For Canadian homeowners approaching mortgage renewal in 2025, one trend is clear: fixed mortgage rates are back in favour. Amid fluctuating interest rates, global economic uncertainty, and household budget strains, borrowers are choosing the predictability of fixed payments—even if it means paying slightly more compared to variable options.

This shift is a reminder that for many families, peace of mind often outweighs the promise of potential savings.

Why Fixed Rates Are Winning Out

The decision to lock into a fixed mortgage rate is being driven by several factors:

Volatile interest rates: Bond yields and central bank policy changes have caused mortgage rates to swing week by week.
Budget certainty: With groceries, gas, and utilities already rising, families want the security of predictable monthly housing costs.
Psychological relief: Borrowers are wary of “payment shock” if variable rates climb unexpectedly.

The Numbers Behind the Shift

Broker surveys indicate that nearly 65% of renewing borrowers in mid-2025 chose fixed rates, compared to just 45% a year earlier. Many are opting for 3-year and 5-year fixed terms, giving them stability while waiting to see how the Bank of Canada handles rates in the coming years.

For example:

A 3-year fixed is averaging around 3.7%–3.9%.
A 5-year fixed is closer to 3.8%–4.0%.
Meanwhile, variable rates remain in the 4.1%–4.5% range.

Expert Opinions

Industry experts are not surprised by this shift.

“It’s not about chasing the lowest rate—it’s about families being able to sleep at night,” said a Toronto-based mortgage broker.
Analysts also note that with many Canadians already stretched thin, a fixed rate is viewed as a financial shield against future surprises.

Risks of Going Fixed

While fixed mortgages provide stability, they are not without drawbacks:

Breaking penalties can be steep if homeowners need to refinance early.
Borrowers could miss out on savings if rates drop sharply over the next two years.

Still, experts say these risks are outweighed by the certainty borrowers gain, especially in an unpredictable economy.

Impact on the Housing Market

The move toward fixed rates could stabilize household finances, lowering the risk of widespread mortgage distress. It also suggests Canadians are preparing for a slow and steady housing recovery, rather than banking on rapid rate cuts or booming prices.

For Canadians approaching renewal, this trend offers lessons:

Peace of mind has value. Even if a fixed rate is slightly higher, knowing your payments won’t change can ease financial stress.
Flexibility matters. Choosing a shorter fixed term (like 3 years) gives homeowners the ability to re-evaluate when the market stabilizes.
Talk to an expert. Each household’s situation is unique—so getting tailored advice is crucial.

As Canada’s mortgage market continues to adjust to uncertainty, the return of fixed-rate popularity signals that for many households, stability is priceless.

👉 Is your mortgage coming up for renewal? Talk to a Mortgage Expert today and explore whether a fixed or variable option is right for you.