With the Bank of Canada holding the overnight rate for months, and with the war in Iran, mortgage interest rates have been making moves.

Buyers and homeowners alike are always wondering whether they should go with a fixed rate or a variable one, and with current events in commotion, the decision feels even more pressing.

Should I go fixed or variable right now?

Let’s talk about it so you can make a confident decision, whether you’re buying your first home in Alberta or renewing your mortgage this year.

Where mortgage rates are sitting right now

As of spring 2026, we’re in a very different market than even a year ago.

The Bank of Canada has been holding its policy rate around 2.25%, and most economists expect that to stay fairly stable through the year. The Bank’s rate directly impacts variable mortgage rates, which went up temporarily after the war in Iran began, but have already started to come back down.

But fixed rates have continued to go up. So what’s going on?

Why fixed rates are moving (even when the Bank of Canada isn’t)

A lot of people assume fixed rates follow the Bank of Canada but they actually move independently.

Fixed rates are driven by bond yields, and right now those are reacting to things like inflation, global uncertainty, and trade risks.

The market is uncertain, and that’s why we’re seeing fixed rates showing upward pressure and why lenders have been adjusting their pricing.

Fixed vs variable: what’s the real difference today?

Fixed rates right now are higher than variable rates, which they usually are. Having a fixed rate means you have a stable payment and a measure of protection against rising interest rates — at least until the end of your term.

Variable rates right now are lower than fixed rates, as usual. Which means the payments fluctuate with the rate. However, variable rate mortgages often offer more flexibility and lower penalties.

Historically, variable rates are usually cheaper than fixed by about 0.25% to 1%. But the trade-off is uncertainty.

Variable rates with fixed payments

One option many people aren’t aware of is a variable rate mortgage with a fixed payment. This means your payment is the same every month but the amount that goes toward your principal vs the interest can change.

This option gives you security when it comes to planning your monthly finances. But it does come with some considerations.

If the variable interest rate climbs, the amount you pay toward the principal is less, which increases how long it will take to pay off your mortgage. If the rate climbs too high, your payment may not be enough to cover even the interest. In that scenario your lender will require you to increase your payments or switch to a fixed rate.

The risk may be more than some buyers are willing to take. But the fact that variable rates are historically lower than fixed rates makes it worth it for many buyers.

What this means for Alberta buyers and homeowners

Most experts now agree that rates are likely to stay fairly flat this year. There’s a possibility of small increases and big rate cuts are not expected. We’re in a balanced, but uncertain market.

That means you don’t need to rush but waiting to buy (or to refinance) probably won’t get you dramatically lower rates.

The right mortgage today isn’t just about the lowest rate. It’s about your risk tolerance, your timeline and your financial flexibility.

That’s where working with a broker really helps.

My Advice to Albertans

Right now I’m mostly suggesting my clients go for fixed rates. For people who can accept a bit of risk I am recommending a variable rate but with a fixed payment. Some lenders have this option and it generally offers an interest rate about half of a percent lower than the fixed rate would be.

If you want help figuring out what makes the most sense for your situation, reach out any time. I’m always happy to walk you through it.