The best 5-year fixed mortgage rates in Canada

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5-year fixed mortgage rates in more detail

Five-year fixed-rate mortgages are generally the most popular mortgage product in Canada. However, in the last few years, many Canadians have reassessed their mortgage options as a result of major changes in the economy, the real estate market and their personal finances. For example: In 2020, when interest rates fell to historic lows, more Canadians than usual opted for a variable mortgage rate to save on interest costs—a trend that reversed itself once rates began to rise again. Here, you’ll find information on how five-year fixed mortgage rates are set, where they might go in the future, and how to find the best rate out there.

5-year fixed mortgage rate highlights

  • On Sept. 28, 2023, the average five-year fixed rate in Canada was 5.49%, according to data from (owned by Ratehub Inc., which also owns In comparison, the average five-year variable rate was 5.95%.
  • Fixed mortgage rates are linked to the price of five-year government bonds. Rapid changes in Canada’s rate of inflation and the Bank of Canada’s benchmark interest rate, among other economic factors, have led to some volatility in bond yields, making it difficult to anticipate where fixed rates will go in the short-term.
  • Historically, variable mortgage rates have trended below fixed rates. Currently, variable rates—which are tied to the central bank’s benchmark rate—remain above fixed rates.

Frequently asked questions about fixed rates

The rate table at the top of this page provides up-to-date information on the best five-year fixed mortgage rates available today. On Nov. 10, 2023, 5.39% was one of the best fixed rates available for a mortgage with a down payment of less than 20%. For a mortgage with a down payment of 20% or more, the most competitive fixed rate was 5.64%. Bear in mind the rate you are offered will depend on the lender, size of your down payment, whether you need mortgage default insurance, and other factors related to your financial situation.

In early 2022, variable-rate mortgage holders saw their mortgage interest costs climb every time the Bank of Canada hiked its benchmark interest rate. Many variable-rate holders now have an interest rate higher than the fixed rates available to new borrowers today. 

Before locking in your mortgage at a lower fixed rate, know you generally have to pay a fee for breaking your original mortgage contract. (Our mortgage penalty calculator can help you estimate this cost.) By locking in a fixed rate, you also eliminate potential savings from a future drop in interest rates before the end of your current term. Switching to a fixed rate can be a good idea if you can no longer tolerate the risk of interest rate increases and need certainty regarding your future mortgage costs. Speak to a mortgage broker or financial advisor about what makes sense for you.

Fixed mortgage rates are based on five-year government bond yields. Since the bond market functions like the stock market, a range of economic factors can influence bond prices—and by extension bond yields. These factors include investors’ expectations regarding Canada’s rate of inflation and the Bank of Canada’s benchmark interest rate, the strength of the job market and Canada’s unemployment rate, demand for safe investments over riskier investments, and the federal government’s credit rating (which reflects its ability to repay its debts).

How much does the average house cost in Canada?

Home prices have steadily trended higher over the past decade, coming to a national average of $698,520 in March 2024. That’s a 75% increase compared to January 2014, and it marks a whopping dollar difference of $398,119, according to the Canadian Real Estate Association (CREA). 

Read the full article: How much income do I need to qualify for a mortgage in Canada?

Where are fixed mortgage rates going in 2024?

It remains difficult to predict where fixed mortgage rates will go in 2024. Between early October and early November 2023, the Government of Canada’s five-year bond yield fell from a peak of 4.42% to 3.79%, leading experts to predict a drop in fixed mortgage rates. We’re still waiting for this long-lead effect.

Signs that Canada’s economy was slowing (and could be entering a recession), as well as indications that the Bank of Canada and the U.S. Federal Reserve could be done hiking interest rates, contributed to the decline in the Government of Canada’s bond yield. Other economic signals, including a rise in unemployment and a slowdown in consumer spending were also at play.

Where fixed interest rates will go in 2024 largely depends on the state of the economy at that time.

Why do fixed rates change? Economic indicators to watch

The bond market functions in a similar way as the stock market; bond prices and yields change based on investor expectations and overall trends in the economy. Let’s take a look at two economic factors that influence the bond market, which in turn impact fixed mortgage rates.

The Bank of Canada’s benchmark interest rate

The BoC’s benchmark rate is a major driving force in the economy, helping to moderate inflation and/or stimulate economic activity as needed. It also guides the interest rates offered on many financial products, including high-interest savings accounts and guaranteed investment certificates (GICs). As a rule, bond prices and yields have an inverse relationship. So, when interest rates are low, bond prices increase—and bond yields fall. When bond yields fall, fixed mortgage rates will typically follow.

What is the current benchmark interest rate?

  • On April 10, 2024, the Bank of Canada (BoC) held its benchmark interest rate at 5%. The central bank last made changes to its interest rate in July 2023. The next interest rate announcement will take place on June 5, 2024.

Canada’s rate of inflation

A high rate of inflation—as measured by the Consumer Price Index—suggests the economy is in overdrive. It means consumer prices and the overall cost of living are rising quickly, putting pressure on Canadians’ finances and cutting into the rate of return on investments. During periods of high inflation, investments offering fixed income (such as bonds) become less attractive to investors. It drives down bond prices, leading to higher bond yields. (Again, this is because bond yields and bond prices have an inverse relationship.) As a result, high inflation can lead to a jump in fixed mortgage rates.

What is Canada’s current rate of inflation?

  • Canada’s annual rate of inflation, as measured by the Consumer Price Index (CPI), feel to 2.8% in February.
  • March CPI data will be released on April 16.

Watch: What is mortgage affordability?

A guide to fixed mortgage rates

What is a five-year fixed mortgage rate? 

As its name implies, a five-year fixed-rate mortgage comes with a mortgage term of five years—that’s the duration for which your mortgage contract remains in effect. In Canada, mortgage terms can range from six months to 10 years, with five years being the most common. 

With a fixed-rate mortgage, your mortgage interest rate is locked in for the period of the contract. This means you can plan for what your mortgage payments will be until your mortgage contract comes to an end and it’s time to renew. 

For this reason, fixed-rate mortgages can provide a greater sense of security than variable-rate mortgages. With a variable-rate mortgage, the interest rate can fluctuate throughout the term. This flux occurs as lenders adjust their prime rates in response to changes to the Bank of Canada’s (BoC) overnight rate. The prime rate is currently 7.2%.

Finally, fixed-rate mortgages can be “open” or “closed.” Whereas an open mortgage comes with the option of making additional regular or lump-sum mortgage payments without penalty, these actions are financially penalized with a closed mortgage (though most include some options for prepayment). As a rule of thumb, closed-term mortgages come with lower interest rates because they offer less flexibility than open mortgages.

Back to guide.

How to compare five-year fixed mortgage rates

The mortgage rate tool at the top of this article provides a glance at the best mortgage rates offered by a swath of Canadian lenders. If you are shopping for a mortgage on a new home purchase, input the purchase price and your down payment amount to view the best mortgage rates available. You can further narrow your search by adding other filters, such as rate type, rate term, amortization, occupancy status, mortgage payment frequency and location of the property. Finally, the tool can also be used by existing mortgage holders to view the best rates for the following:

Mortgage renewal: If your mortgage term is soon ending, and you have an outstanding mortgage balance, you will have to renew your contract for another term. You can do this with your existing lender or a new one—but it’s always good to shop around for a better rate. 

Mortgage refinance: If you want to break your current mortgage contract and negotiate a new contract, that’s called refinancing. You may want to do this to take advantage of lower interest rates or access equity in your home. However, the decision to refinance should not be taken lightly, because you could end up paying significant penalty fees. 

Home equity line of credit (HELOC): This is a revolving line of credit, for a pre-approved amount of money, that allows you to borrow from the equity in your home. The interest rates on HELOCs are usually lower than those for traditional lines of credit, but higher than those typically offered for variable-rate mortgages. The money borrowed through a HELOC is repaid, with interest, in addition to your regular mortgage payments.

Back to guide.

How are five-year fixed mortgage rates determined in Canada? 

Rates for five-year fixed mortgages are strongly linked to the price of five-year government bonds. Banks rely on bonds to generate stable profits and offset potential losses from the money they lend as mortgages. When banks expect their bond profits to increase, they lower their fixed-mortgage rates, and vice versa.

Historically, fixed rates have tended to hover above variable rates; however there are a few instances when variable rates have surpassed fixed rates. This historical trend suggests buyers may end up paying more for fixed mortgages, especially during periods of falling interest rates. 

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The pros and cons of five-year fixed rate mortgages


  • Competitive rates: Lenders know you are shopping around, and they will generally offer comparable and lower rates for your business. 
  • Predictability: You know your interest rate will not change for the duration of the term—same with your mortgage payments. That stability can help you budget more easily.  
  • Potential to save money: If interest rates increase during the term, you could end up paying less than you would with a variable rate. 


  • Stiffer penalties: The penalty to get out of a fixed mortgage contract can be quite a bit higher than with a variable mortgage. You may also be more limited in your ability to pay off your mortgage faster through additional payments.
  • Potential to pay more in interest: Historically, fixed rates have been priced higher than variable rates, with a few exceptions. In some instances, you could end up paying significantly more in interest than you would with a variable rate, if market interest rates fall during your term. 
  • Higher cost: You will pay for predictability and peace of mind. When comparing fixed to variable rates, you will see that fixed rates can be slightly higher.

Back to guide.

Should you switch from a variable- to a fixed-rate mortgage? 

If interest rates do start to go down, a variable-rate mortgage could once again become attractive to some buyers, allowing mortgage holders to take advantage of downward sliding rates. But what if rates simply stay flat, or even rise again?

Opting for a fixed interest rate is advantageous when prevailing interest rates are stable, and you wish to lock in a rate while avoiding the possibility of future increases. In addition, it offers the benefit of consistent and predictable payments, thereby helping you evade any unforeseen fluctuations in the market. 

Back to guide.

Is a fixed-rate mortgage better? 

Kim Gibbons, a mortgage broker with Mortgage Intelligence in Toronto, says both fixed and variable rates each have their benefits and their downsides, so it’s crucial for buyers to consider whether they value stability over potential savings.

“When my clients are trying to determine whether to go with a variable or a fixed rate, I tell them they need to really look at their risk tolerance and whether or not they have enough income or savings to provide a buffer to handle a sudden increase in rates,” she says. “If they are going to lose sleep at night, worried that interest rates are going to go up and they have a limited budget that they can’t go beyond, then a fixed rate is likely a better move. If, however, they have good incomes and a lot of savings put aside then they can better handle fluctuating rates.”

“It really depends on each person’s circumstances,” adds Gibbons. “There’s no single solution that’s right for everyone.” 

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What happens when my mortgage term ends? 

When your mortgage term ends, your mortgage contract will be up for renewal. A few months before it ends, your lender will send you a renewal statement that will include details on the remaining balance on your mortgage, your new interest rate at renewal, your payment schedule and any fees that may apply. At this time, you can choose to renew your mortgage with your current lender or do a comparison shop for a better rate from another lender. 

No matter which lender you ultimately decide on, it’s always worth reviewing what five-year fixed mortgage rates are currently being offered in Canada before you renew or switch products or lenders. 

Back to guide.

Should you choose a five-year fixed mortgage rate?  

When deciding if a fixed-rate mortgage is right for you, there are a number of key factors to consider, including the historical performance of five-year fixed mortgage rates. Depending on what happens with market interest rates during your term, you may pay extra, but those additional costs could save you from the stress of predicting ups and downs in the economy and interest rates.

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Read more about mortgages:


About Sandra MacGregor

About Sandra MacGregor

Sandra MacGregor has been writing about personal finance, mortgages, investing and credit cards for over a decade.
About Justin Dallaire

About Justin Dallaire

Justin Dallaire is the senior editor at He was previously an editor at Strategy magazine and has a master’s degree in journalism from Toronto Metropolitan University.