Mortgage Payment Calculator Canada

Highlights from the Bank of Canada’s March 18, 2026 announcement

On March 18, 2026, the Bank of Canada left its overnight rate unchanged at 2.25%, marking a third straight rate hold. The decision reflects a more cautious tone from the central bank as it evaluates new risks to the economy and inflation outlook. 

• For borrowers, the hold means variable mortgage rates remain steady. Since the Bank did not change its benchmark rate, lenders’ prime rates will also stay unchanged, keeping borrowing costs stable for Canadians with variable-rate mortgages. Current variable pricing is still fairly competitive, with the lowest available rates around 3.35%.
• Fixed mortgage rates are becoming less favourable, however, as bond yields continue to rise. With both U.S. and Canadian yields pushing higher, lenders have started increasing fixed mortgage pricing. The best insured five-year fixed rate has climbed to 3.94%, up from 3.79% in February.
• Looking ahead, the Bank is still on pause, but the possibility of future rate hikes is now part of the conversation again. If inflation starts rising due to higher energy costs, the Bank may need to respond later this year. For home buyers, that creates a mixed picture: affordability is improving as home prices soften, but borrowing costs may not fall further from here.

March 2026: Mortgage market update

2025 has been a relatively slow year for the Canadian housing market, with buyers hunkered down due to the uncertainty over new U.S. tariff threats. If you’re looking for a mortgage rate in Canada, read on for some key information.

• CPI update: Canada’s inflation rate ticked back up in March 2026, with the Consumer Price Index (CPI) rising 2.4% year over year, compared to 1.8% in February. The increase was mainly driven by energy, particularly gasoline, which rose 5.9% annually and jumped 21.2% from the previous month. At the same time, most other prices didn’t accelerate in the same way. CPI excluding gasoline slowed to 2.2%, suggesting inflation across the broader economy is still relatively stable. Some categories even saw slower growth due to base-year effects, with restaurant prices rising 3.2%, down sharply from 7.8% in February. The data also shows a split in where Canadians are feeling pressure. Grocery prices remain high, rising 4.4% year over year, with fresh vegetables up 7.8%, keeping everyday costs elevated. Meanwhile, shelter inflation is easing overall at 1.7% annually, helped by slower growth in mortgage interest costs (+0.3%). CPI Median held at 2.3% and CPI Trim edged down to 2.2%, showing that underlying price growth is steady but not falling quickly. Overall, the March numbers suggest inflation is being pulled up by volatile factors like energy, rather than a broad rise in prices, giving the Bank of Canada reason to stay cautious and likely keep rates unchanged for now.
  
  
• Real estate update: Canada’s housing market remained relatively unchanged in March 2026, with sales activity showing little momentum despite the typical spring season boost. According to the Canadian Real Estate Association (CREA), national home sales dipped 0.1% from February and were down 2.3% compared to a year earlier. On the supply side, new listings remained limited, declining 0.2% month over month and continuing a trend of subdued seller activity. This balance between softer demand and constrained supply kept overall market conditions stable. The national sales-to-new listings ratio (SNLR) came in at 47.8%, within the 45% to 65% range that typically signals a balanced market. Price trends continued to move downward, though the rate of decline has begun to slow. The MLS® Home Price Index fell 0.4% compared to February, a smaller decrease than in earlier months, while prices were down 4.7% on an annual basis. The national average home price reached $673,084, marking a modest 0.8% decline from March 2025. Meanwhile, inventory levels held steady at around five months of supply, aligning with long-term norms and giving buyers more flexibility than in recent years. However, total listings reached 167,524 properties, up just 1% year over year, indicating that supply has not increased enough to meaningfully shift market dynamics.

Canadian housing market forecast for 2026

The Canadian Real Estate Association (CREA) has revised Canada’s housing market outlook for 2026, amid renewed pressure from borrowing costs and economic uncertainty. Home sales are now expected to see only marginal growth in 2026, with 474,972 properties forecast to change hands — a 1% increase over 2025. This growth is expected to be led primarily by British Columbia and Ontario, where activity has more room to rebound after recent slowdowns. In contrast, provinces that experienced stronger demand in prior years, partly due to population gains, are now expected to see little movement or slight declines. On the pricing side, the national average home price is forecast to rise 1.5% to $688,955. Looking ahead, CREA expects a gradual and cautious improvement in 2027, with national home sales projected to increase by 2.1% to 485,071 units. However, this outlook remains highly sensitive to interest rate trends. Home prices are forecast to edge up by 0.9% to $695,094, with gains remaining below inflation levels. Overall, this suggests a housing market that is stabilizing rather than accelerating, with average prices continuing to hover close to the $700,000 level for several consecutive years.

Why use a mortgage payment calculator?

When planning to buy a home, it's easy to focus on the final purchase price or your mortgage amount. But actually, the most relevant number to you will be your regular repayment. After all, your mortgage payments are the amount that you'll need to take from your paycheque each month.

What is a mortgage payment?

Your mortgage payment is the amount of money you must pay every month to pay down, and ultimately pay off, your mortgage loan. Your mortgage payment covers both the principal (the actual amount of the loan) and the interest on the loan. It can also include mortgage default insurance, also sometimes known as CMHC insurance (required when your down payment is less than 20% of the cost of your home), property taxes and other fees. When you first begin making payments, more of it goes towards covering interest, but over time, more of your payment will eventually go to paying down your mortgage balance.

Tip for first-time home buyers: GST exemption

Under Prime Minister Mark Carney’s GST exemption proposal, first-time home buyers could save up to $50,000 if they buy a $1-million newly-built home or a substantially renovated property. The Conservative Party has proposed a similar plan, which would apply to homes priced up to $1.3 million and wouldn’t be limited to first-time buyers.

The final form of this policy hinges on the outcome of the Federal Election on April 28, 2025, leaving some details in flux. 

Also read: Federal Liberals and Conservatives vow to remove GST on new home purchases

How do I get approved for a mortgage?

When thinking about your monthly mortgage payments, it’s also important to consider what you’ll need in order to get approved for a mortgage. Here are some of the most important things that prospective lenders will want to see: 

• A good credit score: You need a credit score of 680 or higher to qualify for the best mortgage rates that allow for the lowest monthly mortgage payments. To qualify for any mortgage at all, you’ll need a credit score of at least 560. Read more on how your credit score affects your ability to get approved for a mortgage.
• Proof of income: You’ll need to provide proof of income in the form of pay stubs and/or tax documents like your Notice of Assessment (NOA). If you recently started a new job, even with proof of income, many lenders will want to see that you’ve held the position for at least a year. 
• Ability to pass a mortgage stress test: You will need to pass a mortgage stress test, which ensures that you can still afford your mortgage payments at a rate known as the “qualifying rate”, set by the Office of the Superintendent of Financial Institutions (OSFI), or your contract rate + 2%, whichever is the higher of the two. 
• Down payment: The size of your down payment affects the house you can afford as well as the size of your mortgage and associated monthly payments. As well, it affects whether you will need to purchase mortgage default insurance, which is required if your down payment is less than 20% of the value of the home you are purchasing. The minimum down payment you’ll need to have depends on the home you’re looking to buy:

More mortgage calculators

For further information, check out these helpful pages!

• Best Mortgage Rates in Canada
• Variable or Fixed Mortgage Rates
• Amortization
• Mortgage Default Insurance (CMHC Insurance)
• Open vs. Closed Mortgage: What's the Difference?
• Mortgage Terms Glossary 
• Mortgages