Canadian fixed mortgage rates have moved decisively higher, with lenders rolling out increases of up to 30 basis points as bond yields continue their rapid climb.
The benchmark five-year Government of Canada bond yield—used to price most fixed mortgages—has surged more than 60 basis points since last month, including a 22-basis-point jump on Friday alone. The yield recently pushed above 3.20%, marking a sharp reversal from the lows seen just weeks ago.
That move had already been feeding into mortgage pricing through the month. Now, lenders are accelerating those increases.
“All rates [are] going wild today,” mortgage broker Ron Butler told Canadian Mortgage Trends on Friday, adding there’s little chance of a near-term pullback.
Non-bank lenders have led the latest round of increases, with some raising 3- and 5-year fixed rates by as much as 30 basis points (0.30 percentage points), while the Big 6 banks have yet to fully respond.
Butler said pricing is “up & up at all lenders,” with even 1-year rates starting to rise.
Why bond yields are rising
The move is being driven more by global forces than domestic data. The underlying driver, Butler says, is straightforward: “War, higher energy cost = inflation = higher bond yields = higher fixed rates.”
Mortgage expert Dave Larock had flagged the shift earlier this month following the outbreak of the war, noting that it had already begun feeding through to mortgage pricing as lenders reversed earlier rate cuts. “GoC bond yields surged higher…alongside their U.S. Treasury equivalents,” he wrote at the time.
“Lenders quickly moved from cutting their fixed rates before the war started to raising them shortly thereafter,” he noted, adding that “further near-term increases should be expected.”
What it means for borrowers—and what comes next
For some borrowers, the impact is immediate. Those who secured rate holds earlier this month remain protected for now, but others are already facing higher borrowing costs. “Those that didn’t will pay more next week,” Butler said.
So far, the impact has been concentrated in fixed rates, while variable-rate pricing has remained relatively stable. But the broader repricing in bond markets is also feeding into rate expectations, with markets now increasingly pricing in the risk of Bank of Canada hikes as oil-driven inflation concerns build.
Looking ahead, the path for fixed rates may hinge less on domestic data and more on geopolitical developments. Butler expects that any relief would require a reversal in current energy-driven pressures, and even then, a full return to earlier rate levels may be unlikely.
“War ends = rate drops, but not all the way to February rates,” he said.
A shift back toward variable?
Rising fixed rates are also beginning to influence borrower behaviour, particularly as the gap between fixed and variable rates widens again.
Bank of Canada data shows variable-rate mortgages accounted for roughly 43% of originations in January, a notable rebound from the lows seen during the peak of the rate cycle.
“Given the growing gap between fixed and variable, it’s not surprising that more borrowers are opting for floating-rate loans,” said Ben Rabidoux, founder of Edge Realty Analytics.
GST rebate for first-time buyers now in effect as legislation receives Royal Assent
The federal government’s GST rebate for first-time homebuyers is now officially in force after Bill C-4 received Royal Assent, allowing the Canada Revenue Agency to begin processing claims.
The measure eliminates the GST on new homes priced up to $1 million for eligible first-time buyers, with a partial rebate on homes between $1 million and $1.5 million. While the maximum benefit is estimated at up to $50,000, the Parliamentary Budget Officer has projected typical savings closer to $27,000.
The policy applies to purchase agreements entered into on or after March 20, 2025, and before 2031, marking a key step in the government’s effort to improve housing affordability and support first-time buyers entering the market.
CMHC says affordability still near historic lows despite recent improvement
CMHC has launched a new housing affordability composite index that takes a broader view of affordability, incorporating income, supply conditions and both rental and ownership markets.
The index shows affordability deteriorated sharply between 2020 and 2023 and, while conditions have improved modestly since then, they remain near historic lows. The data also suggest affordability pressures have spread beyond Toronto and Vancouver to cities like Ottawa, Montreal and Halifax.
CMHC says the new framework is intended to better capture how rental and ownership markets interact and where supply-demand imbalances are most acute.
“Our new Housing Affordability Composite Index…helps identify imbalances between supply and demand,” said chief economist Mathieu Laberge, adding it can help inform what types of housing are needed and where.
EQB receives Competition Bureau approval for PC Financial acquisition
EQB Inc. has received clearance from the Competition Bureau for its proposed acquisition of President’s Choice Bank and affiliated PC Financial entities from Loblaw Companies Ltd., marking a key regulatory milestone for the deal first announced in December 2025.
The transaction, which would combine EQ Bank’s digital platform with PC Financial’s large customer base and loyalty ecosystem, still requires approval from the Office of the Superintendent of Financial Institutions and the federal finance minister before it can close.
Once completed, the acquisition is expected to significantly expand EQB’s reach, giving it access to more than 2.5 million PC Financial customers and strengthening its position as a scaled challenger to Canada’s largest banks.
Mortgage industry tops $1M goal, raises record $1.2M for cancer research
Canada’s mortgage industry has surpassed its fundraising goal in a big way, raising more than $1.2 million for cancer research through this year’s Strike Out Cancer campaign — a record result that underscores the industry’s growing national reach.
The fundraiser brought together 30 sponsors and 1,361 participants across 14 locations nationwide. With this year’s total, the campaign has now raised more than $2 million over the past three years.
Founder Don Stoddart said he was “truly amazed” by the level of support from across the industry.
“To everyone who contributed in any way, you should be immensely proud. This truly is the greatest industry in the world,” he said. “Thank you for making a difference, and we look forward to seeing you all again next year.”
Mortgage arrears edge higher again, reach 0.26% nationally
Canada’s mortgage arrears rate continued to climb at the end of 2025, rising to 0.26% of all residential mortgages in December, according to the Canadian Bankers Association — the highest level since 2020.
A total of 12,900 mortgages were in arrears by 90 days or more at month-end, up from 12,236 in October, extending the gradual upward trend seen over the past year.
Saskatchewan remained the highest at 0.52%, followed by Manitoba (0.36%) and Atlantic Canada (0.30%). Ontario’s arrears rate rose to 0.27%, slightly above the national average, while Alberta matched the national rate at 0.26%. British Columbia (0.23%) and Quebec (0.19%) remained below average.
Despite the increase, arrears remain historically low, with roughly 99.7% of mortgage holders still current on their payments.
Next Steps: Mortgage industry career moves
First National CEO Jason Ellis to retire by end of 2026
First National Financial Corp. President and CEO Jason Ellis plans to retire by the end of 2026, capping more than two decades with the company.
Ellis joined First National in 2004 and has served as CEO since 2022, overseeing the lender through a period that included its 2025 go-private transaction. The company has grown from roughly $10 billion in mortgages under administration at the time of his arrival to more than $165 billion today.
The board has launched a search for a successor, with Ellis set to remain in the role during the transition and support the incoming CEO in an advisory capacity.
First National said it expects a smooth leadership transition, citing its established strategy, senior leadership team and long-standing relationships with brokers and institutional partners.
For more on Ellis’ decision and what it means for the industry, read our full interview.
Basel Committee names OSFI’s Ben Gully as secretary general
Ben Gully, deputy superintendent of OSFI’s Supervision Sector, has been appointed secretary general of the Basel Committee on Banking Supervision, with his three-year term set to begin in August 2026.
Gully has been with OSFI since 2001 and has led its supervision arm since 2022, overseeing the regulation of Canada’s banks, insurers and federally regulated pension plans. He has also held roles at the Australian Prudential Regulation Authority and the Bank of England.
The appointment places a Canadian regulator in a key role at the global standard-setting body for bank supervision, which develops international rules aimed at strengthening financial stability.
“Next Steps” is a feature in our Mortgage Digests that highlights notable job changes and career advancements within the mortgage industry. If you have a job update to share, we welcome your submissions to keep the community in the loop.
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Last modified: March 21, 2026