Is a fixed or variable mortgage rate better in today’s market?

I was in your shoes recently and it’s a tough call. I chose a fixed rate because I wanted stability and predictable payments each month. A friend of mine went variable and while they saved early, the recent hikes hit their budget hard. It really depends on your risk comfort and how much wiggle room you have in your finances. Running both scenarios against your budget can make the choice a lot clearer.

I don’t think there’s a universally “better” choice—it really depends on your financial situation and how much uncertainty you’re comfortable with. A fixed-rate mortgage offers predictable monthly payments, which many first-time buyers value, while a variable rate can save money if rates fall but also comes with the risk of higher payments if they rise.

One thing I’d consider is whether your budget can comfortably handle payment increases if you choose a variable rate. If not, the stability of a fixed rate may be worth the extra cost.

I think the “right” choice depends less on where rates might go and more on how much uncertainty you’re comfortable living with. A fixed-rate mortgage gives you predictable payments, which can be valuable if you’re buying your first home and want stability. A variable rate may save money if rates decline, but you need enough financial flexibility to handle higher payments if they move the other way.

I’d also avoid making the decision based solely on forecasts—no one can consistently predict where interest rates will be a year or two from now. Instead, choose the option that still fits your budget under less favorable conditions. If your finances work even in that scenario, you’re much more likely to sleep well regardless of what the market does.