What Will Interest Rates Look Like at the End of 2026?

It is probably the number one question I hear from people thinking about buying a home:

Should I buy now, or wait for interest rates to change?

As of September 2, 2026, the Bank of Canada has kept its overnight policy rate at 2.25%. In fact, the rate has remained at 2.25% throughout 2026 so far.

So what happens next?

The Current Expectation: Rates May Finish 2026 Around 2.25%

The Bank of Canada's latest Market Participants Survey provides a useful clue.

The median forecast from market participants was for the policy rate to remain at 2.25% in October and December 2026.

In other words, the current base case is not a dramatic move up or down before New Year's Eve.

But there is an important catch.

Inflation Is Making the Decision Harder

The Bank's September announcement noted that headline inflation had been hovering around 3%, driven largely by higher gasoline prices. Inflation excluding gasoline was 2.2%, and core measures remained close to 2%.

At the same time, energy prices, tariffs and global events have increased the risk that inflation could stay higher for longer.

That is why buyers should not assume another rate cut is around the corner.

In the Bank of Canada's market survey, 40% of participants described the risks around their forecast as skewed toward a higher rate path, compared with 28% who saw the risk tilted lower.

Could We See a Rate Increase Before 2027?

It is possible.

The Bank has two scheduled decisions remaining after September:

October 28, 2026 December 9, 2026

If inflation continues to ease, the Bank may simply stay where it is.

If energy prices and other inflation pressures continue, a small increase becomes easier to imagine.

For now, though, 2.25% at year-end remains a reasonable central scenario, rather than something I would call guaranteed.

What Does This Mean for Mortgage Rates?

There is another important thing to remember.

The Bank of Canada rate and the mortgage rate offered to you are not the same number.

Variable mortgage rates are influenced strongly by lenders' prime rates, which in turn are influenced by the Bank of Canada's overnight rate. The typical prime rate at Canada's major banks was 4.45% in late August 2026.

Fixed mortgage rates can move for other reasons too, which means they can change even while the Bank of Canada stays put.

So waiting for one specific Bank of Canada announcement does not necessarily mean you will get a better mortgage.

What I Would Watch Instead

If you are planning a Vancouver purchase, I would look at the whole equation:

The price you can negotiate today, the amount of inventory available, your monthly payment, your down payment, the property itself and how long you expect to own it.

A better purchase price can sometimes matter far more over the life of a property than waiting months for a small change in borrowing costs.

Interest rates matter.

But the property and the price you pay for it still matter more.