The ongoing conflict in Iran and the closure of the Strait of Hormuz are creating unexpected ripple effects across the Canadian economy, particularly in the housing market. Despite the Bank of Canada maintaining its key interest rate, Canadian homeowners are seeing their mortgage payments increase due to geopolitical tensions thousands of miles away. The Direct Impact on Fixed Rates Since the conflict began in late February 2026, five-year fixed mortgage rates in Canada have risen by approximately 0.25% across all major lenders. 2 3 4 This increase represents a significant shift in a short period , with insured five-year fixed rates climbing from around 3.9% to 4.2% at their peak. 4 The change has been described as a "roller coaster" by mortgage experts, with rates experiencing double-digit basis point hikes. 4 The Oil-Bond-Mortgage ...
