While one-year fixed rates – currently near 4.50 per cent – are likely to hold in the short-term, Alexander believes upward pressure is building for two, three, and five-year terms.
“ Soon it will be bye-bye to 4.50 per cent,” he suggests.
Most borrowers, he notes, will continue to opt for short terms due to their lower cost, but if inflation surges, those borrowers may face higher rates sooner than planned.
WHAT THIS MEANS FOR THE MARKET
For active market participants, whether purchasing, selling or refinancing, these dynamics matter.
• Homeowners refinancing in the next six months may want to consider a diversified strategy across terms.
While Alexander cautions that rising rates could help to contain house price growth later in the cycle, he also reinforces that the overall economic outlook is strengthening, and the recovery appears on a firm footing.
For the real estate sector, clearer economic signals, improving consumer sentiment, and returning buyer activity all support a more confident market heading into 2026, even amid shifting rate expectations.
• Buyers may benefit from locking in favourable terms now, particularly if they’ re considering a longer fixed period.
• Sellers could see confidence strengthen further as economic signals continue to improve, even if mortgage rates lift.
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