The Short Answer
On October 28, 2026, the Bank of Canada raised its policy rate by 0.25 points to 2.5%, its first increase since July 2023. Inflation rose to 3.1% in September, driven mainly by energy and gasoline prices. Banks are expected to raise prime by the same amount, so variable-rate mortgage and HELOC costs go up. On a $618,480 variable mortgage, a move from 3.45% to 3.70% adds about $82 a month. Fixed rates follow bond yields and had already moved up. The next decision is December 9, 2026.
Wondering how today's decision affects your plans? Call the Kaizen Real Estate Team at (647) 370-8885.
What Happened Today
The Bank of Canada ended a year-long hold at 2.25% and raised its policy rate to 2.5%. It said the goal is to keep higher energy costs from spreading into broader inflation. Governor Tiff Macklem said further increases are possible, with decisions made one meeting at a time.
Michael John Lau, a REALTORĀ® with the Kaizen Real Estate Team, one of the most active real estate teams in Markham and York Region, is reviewing what the change means for clients with variable mortgages, upcoming renewals and active home searches.
Questions About Rates and Your Move?
Every mortgage and every plan is different. Call the Kaizen Real Estate Team at (647) 370-8885 and speak to a REALTORĀ® who works this market daily.
The Key Numbers
Measure | Figure |
|---|---|
Policy rate | 2.5%, up from 2.25% |
Inflation, September 2026 | 3.1%, up from 3.0% in August |
Gasoline prices, year over year | Up 27.8% |
Inflation excluding gasoline | 2.2% |
Lowest 5-year variable rate, expected | 3.70%, up from 3.45% |
Lowest 5-year fixed rate | 4.34% |
The Bank expects inflation to stay above 3% through much of 2027 and return to about 2% by mid-2028.
Neeraj Moolchandani on Todayās Decision
Neeraj Moolchandani, REALTORĀ® at Kaizen Real Estate, is reminding buyers that one rate change rarely decides whether a move makes sense.
What matters more is the monthly payment you are comfortable with, the home you need and how long you plan to stay.
If You Have a Variable Mortgage or HELOC
Mortgage balance, 25 years | At 3.45% | At 3.70% |
|---|---|---|
$618,480 | About $3,072 | About $3,154 |
$800,000 | About $3,973 | About $4,079 |
Adjustable-rate mortgages change payments right away. Fixed-payment variable mortgages keep the payment the same, but more of it goes to interest. HELOC interest also rises with prime.
If You Have a Fixed Rate or Are Renewing
A fixed rate does not change until renewal. Fixed rates follow five-year bond yields, which rose ahead of the decision as markets expected a hike. If your renewal is in the next few months, ask your lender about a rate hold now and compare options.
Want to Talk Through Your Options?
The Kaizen Real Estate Team can help you understand what the change means for your purchase, sale or renewal.
For Markham Buyers
Higher rates reduce how much buyers qualify for, though the stress test already qualifies most borrowers at the higher of their rate plus 2% or 5.25%. In September 2026, Markham had 1,122 active listings for 245 sales, with homes selling at 98% of list price, so buyers still have choice and room to negotiate. A pre-approval with a rate hold protects you if rates rise again before you buy.
For Markham Sellers
Some buyers may pause after a hike, which can slow activity. Pricing in line with recent sales matters even more. Sellers who are also buying should plan their own financing carefully. See coordinating two closing dates.
What to Do Now
- Variable borrowers: check your new payment or amortization with your lender.
- Renewing within six months: ask about a rate hold.
- Buyers: get or refresh a pre-approval.
- Everyone: watch the December 9 decision.
Ultimately, the decision is yours. The goal is to make sure you have all the information to plan your next step.
Next Steps
- Mortgage calculator: see your payment at new rates.
- Request a free home evaluation: know your equity before renewal.
- Buying your next home: plan your search around rates.
Work With Michael John Lau in Markham
Michael John Lau helps Markham buyers and sellers turn market numbers into a clear plan for their own situation. That means looking past city-wide averages to recent sales on your street, explaining the reasoning behind every recommendation, and making sure you have the information you need to decide with confidence.
š Contact Michael John Lau, REALTORĀ®
š www.callmikelau.com
š” www.livinginmarkham.ca
š¢ www.kaizenrealestate.ca