Quick answer: In early November 2026 the best insured five year variable rates were about 3.68%, compared with about 4.44% for five year fixed. Variable is cheaper today, but the Bank of Canada raised rates in October and may raise again. Choose variable if you can handle higher payments and want a smaller penalty. Choose fixed if a steady payment matters more to you.
This is the question I hear most since the October rate hike. There is no single right answer, but there is a right answer for your budget and your plans. Here is how I walk clients through it.
What is the difference between fixed and variable rates?
A fixed rate stays the same for your whole term, usually five years. Your payment does not change no matter what happens to rates.
A variable rate moves with your lender's prime rate, which follows the Bank of Canada. When the Bank raises its rate, your rate goes up by the same amount. With some lenders your payment changes; with others your payment stays the same and more of it goes to interest.
What are fixed and variable rates in BC right now?
These were the best advertised insured five year rates in Canada as of November 4, 2026. Your own rate depends on your down payment, credit, property and the lender.
| Five year term | Best insured rate | Monthly payment on $500,000 (25 years) |
|---|---|---|
| Fixed | 4.44% | about $2,751 |
| Variable | 3.68% | about $2,544 |
Today the variable payment is about $207 a month lower. See what lenders are offering now on our current rates page.
How far would rates have to rise before variable costs more?
The gap between the two rates is about three quarters of a point. Roughly speaking, the variable rate would have to rise by that much and stay there for most of the five years before it costs more than locking in today.
The Bank of Canada raised by a quarter point in October. Some economists expect one more quarter point early in 2027. If that happens and rates then hold, variable would still come out slightly ahead. If inflation stays high and the Bank keeps raising, fixed wins. That is the trade off.
Who should choose a variable rate right now?
- People with room in their monthly budget if payments rise by $100 or more.
- Buyers who may sell, move or refinance within three years, because the penalty to break a variable mortgage is usually just three months of interest.
- Borrowers who want to pay down principal faster while the rate is lower.
Who should choose a fixed rate right now?
- First time buyers stretching to qualify, where a payment increase would hurt.
- Families on a fixed income or a tight monthly budget.
- Anyone who simply sleeps better knowing the payment will not change.
Before you lock in, read about mortgage penalties in BC. Breaking a fixed mortgage early can cost thousands because of the interest rate differential.
Is there a middle option between fixed and variable?
Yes. A two or three year fixed term gives you payment certainty for a shorter time, so you are not committed for five years if rates fall later. A hybrid mortgage splits the loan between fixed and variable. A variable mortgage can also be locked into a fixed rate later, usually without a penalty, if rates start climbing quickly. Our guide on when to lock in a variable rate covers that decision.
What are the key takeaways?
- Variable is about three quarters of a point cheaper than fixed today.
- That saves about $207 a month on $500,000, but the Bank of Canada is raising rates.
- Variable suits people with flexible budgets and plans that may change; fixed suits people who need a steady payment.
- Shorter fixed terms and hybrids are worth comparing too.
If you would like me to compare fixed, variable and shorter terms for your situation, book an appointment or call 604 591 3590.
What other questions do readers ask?
Is a variable rate cheaper than a fixed rate right now?
Yes, at the start. In early November 2026 the best insured five year variable rates were around 3.68% and the best insured five year fixed rates around 4.44%. Whether variable stays cheaper depends on how far the Bank of Canada raises rates over your term.
What is the penalty for breaking a variable mortgage?
For most variable mortgages the penalty is three months of interest. Fixed mortgages usually charge the greater of three months of interest or an interest rate differential, which can be much larger, especially at big banks.
Can I choose a shorter fixed term instead?
Yes. Two and three year fixed terms let you avoid variable payment changes while committing for less time. They suit people who expect to move, refinance or see lower rates within a few years.
What is a hybrid mortgage?
A hybrid splits your mortgage into a fixed part and a variable part. It spreads your risk, but it can be harder to switch lenders at renewal, so ask about the fine print first.
Where do these numbers come from?
- Ratehub: best five year fixed and variable mortgage rates
- Bank of Canada policy rate decision, October 28, 2026 (full text)
- Trading Economics: Canada five year bond yield
Published November 11, 2026. This article is general information, not personal financial advice. Rates and programs change, and every approval depends on your full application. Asim Ali is a licensed mortgage broker with Dominion Lending Centres A.I.M.I. Collective Mortgage Group.