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Fixed vs Variable Rates for Investors in Ontario – What’s Smarter in 2025?

Fixed vs Variable Rates for Investors in Ontario – What’s Smarter in 2025?



Published by: Sol Yasin | Mortgage Agent Level 1

Brokerage: Kingsdale Mortgage Centre Inc. | FSRA License #13585

Location: Ontario, Canada




🎯 Why This Decision Matters More Than Ever



Rates are high. Real estate activity is slow. And headlines are louder than ever.


But for serious real estate investors in Ontario, this environment is exactly when smart mortgage strategy matters most.


The choice between fixed and variable rates in 2025 isn’t just about getting the lowest number — it’s about protecting your cash flow, planning for future deals, and structuring your debt for growth.


Let’s break it down.


🔍 Who Am I to Give You This Advice?


I’m Sol Yasin, licensed mortgage agent in Ontario and active investor for over 15 years.


I’ve worked with hundreds of investors buying, refinancing, BRRRRing, and scaling portfolios across Ontario — and what separates those who grow from those who stall is almost always financing strategy.


That’s what this blog (and my YouTube channel Mortgages by Sol) is all about.



💼 Fixed vs Variable Rates for Investors



Let’s define the basics — with an investor lens:


✅ Fixed-Rate Mortgages



  • Locked-in rate for 1–5 years

  • Predictable payments

  • Best for long-term holds or tight cash flow




✅ Variable-Rate Mortgages



  • Fluctuates with the Bank of Canada’s prime rate

  • Often lower to start — but higher risk

  • Ideal for short-term plays, renos, or refinance strategies




Key Investor Considerations:



  • Prepayment penalties: Fixed rates often carry IRD penalties, which can cost thousands if broken early. Variable usually has just a 3-month interest penalty — better for BRRRRs, flips, or early exits.

  • Refinance timing: If you plan to pull equity within 1–2 years, variable or short-term fixed (1–2 year) can give you flexibility without harsh penalties.

  • Alignment with your plan: Your mortgage term should support your exit plan, cash flow model, and portfolio growth — not just headline rates.





📊 What’s Actually Happening in 2025?



As of mid-2025, we’re entering a rate-cutting cycle in Canada. Inflation has cooled, and the Bank of Canada is beginning to ease up.



Here’s what that means:



  • Fixed rates have already started to fall, as bond yields price in anticipated cuts.

  • Variable rates remain high (for now), since lenders are cautious and prime hasn’t moved much yet.

  • Some fixed-rate mortgages are now cheaper than variable — which flips the usual script.



👉 So don’t assume variable is always cheaper. In today’s market, you need to choose based on structure, penalties, and flexibility — not just rate.




🧠 What Investors Should Consider Before Choosing



Before picking a rate type, I walk every client through these four questions:



1. Cash Flow Tolerance



Can your property absorb fluctuations? Fixed offers predictability. Variable gives flexibility — with more risk.



2. Refi or Exit Timeline



Planning a BRRRR or value-add play in the next 12–24 months? Avoid fixed IRD penalties. Consider variable or a short-term fixed.



3. Lender Policy Differences



Trigger rates, blending rules, and prepayment privileges vary. The fine print matters.



4. Portfolio Growth Strategy



Want to buy again soon? You may want to prioritize flexibility and qualification power over rate.




🧱 What Most Investors Are Doing Right Now



Here’s what I’m seeing across my investor clients in Ontario:


  • 🔒 1 to 3-Year Fixed Rates: For stability without a long-term commitment.

  • 🔄 Variable Rates for BRRRRs & Flips: Lower penalty exposure and easier exits.

  • 🧩 Mixing Strategies: Fixed for long holds, variable for short terms, and HELOCs for renos.



There is no one-size-fits-all answer — only smart structure based on your unique plan.




💬 Final Thoughts: Make the Move Before the Market Does



Uncertainty creates hesitation — but also opportunity.


The smartest investors in Ontario are positioning now, before the market heats up again. That means getting pre-approved, setting up your HELOC, and locking in flexible terms while others wait.


Need help reviewing your current mortgage, equity, or purchase plans?




📞 Book a Free Strategy Call



Let’s build your mortgage roadmap.


🔗 Book a free strategy call

🌐 Get pre-approved


📍 Based in Ontario — helping investors across the province

📋 Sol Yasin, Mortgage Agent Level 1

🏢 Kingsdale Mortgage Centre Inc. | FSRA License #13585




⚠️ Disclaimer



This blog is for informational and educational purposes only and does not constitute financial, legal, or mortgage advice.

Always consult a licensed mortgage professional before making any financing decisions.

Sol Yasin is a licensed mortgage agent in Ontario, FSRA License #13585, operating under Kingsdale Mortgage Centre Inc.