Happy New Year! A hopeful new year of 2026 has dawned.It's been a while since I've greeted you through a column. I hope everyone has been safe and well. Going forward, I plan to consistently share updates on the Canadian real estate market trends, mortgage rate changes, lending tips, and more every week.In this edition, I'll focus on the current Canadian mortgage rate situation as of early January 2026 and the outlook for the year.As of early January 2026, the Bank of Canada's policy rate is maintained at 2.25%. Accordingly, the prime rates of major banks are at the 4.45% level. This reflects a stabilized state following the completion of the rate-cutting cycle from 2024–2025.Five-year fixed mortgage rates are linked to the government 5-year bond yield (currently around 2.95–3.00%) and are generally forming in the range of 3.89–4.09% (based on the lowest discounted rates), while variable-rate mortgages are around 3.55~4.45% based on the prime rate. (Actual applied rates may vary depending on individual credit and loan conditions.)The 2026 interest rate outlook is generally stable. Most major banks (RBC, TD, BMO, CIBC, etc.) and economic experts believe there's a high likelihood that the Bank of Canada will hold the policy rate at 2.25% for most of the year. This is because inflation is stabilizing near the 2% target (currently around 2.2%) and economic growth is recovering.Further rate cuts are expected to be limited, and some have even raised the possibility of a slight hike in the second half of the year (e.g., to 2.5–2.75%) if the economy shows strength or inflation rises again. However, trade uncertainties with the United States (USMCA renegotiation and tariff risks) are expected to act as major variables.That said, many people still feel that everyday prices remain high and may not sense that the economy has fully recovered. Groceries, housing costs, and other daily expenses continue to be burdensome, so I understand the voices hoping for additional rate cuts. Unfortunately, the majority of experts anticipate stable holds rather than significant cuts this year, making it seem unlikely that interest rates will fall below current levels.This stable rate environment is positive for home buyers or those facing renewals. It allows for steady planning without sharp fluctuations. In particular, with variable rates continuing to be lower than fixed rates, it may be worth considering a variable option depending on your risk tolerance.If you're planning to purchase a home or refinance your mortgage in the new year, I strongly recommend consulting with a specialist to find the best option tailored to your personal situation. It's important to carefully compare details such as fixed vs. variable, prepayment terms, and insurance requirements.In future columns, I'll provide more specific case studies, regional trends, and practical tips. If you have any questions, feel free to leave a comment or contact me anytime!Wishing you a healthy and happy 2026!

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