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Mortgage interest costs were up 30.5 per cent compared with a year ago as the Bank of Canada's benchmark interest rate sits at five per cent.

Here are some common questions about inflation and mortgage renewals.

How could the latest inflation data affect my mortgage renewal?

While the rate of inflation and mortgage rates are correlated, James Laird, co-CEO of rate comparison website , said the latest inflation report is unlikely to have any immediate effect on existing mortgage rates.

"We still need to watch next month and the month after that to see how inflation is trending back to that two-per-cent level," he said.

However, with the Bank of Canada's benchmark rate at five per cent — the highest since 2001 — homeowners with a mortgage renewal coming up will likely have to renew at a higher interest rate.

Should I opt for a shorter-term mortgage upon renewal?

Laird said a homeowner's choice on term length and whether they sign on for a variable or fixed rate depends on their risk tolerance and outlook for interest rates.

If a consumer feels that inflation is going to steadily make its way back to two per cent and push the Bank of Canada to begin cutting rates, a shorter-term loan, such as a one- to three-year term, or a variable-rate mortgage could work well.

He said consumers who opt for a fixed-rate mortgage with a shorter term will pay more in interest than those that choose a long-term fixed-rate loan. Homeowners have to be strategic in choosing the type of mortgage to make sure they're able to save money, he said.

For a homeowner who believes inflation and interest rates are going to remain high, a five-year fixed rate would be the safer option, he said.

"No one should take a variable rate unless they have financial flexibility in their budget," Laird said.

What does the inflation data mean for my household budget?

The latest numbers don't suggest ´ºÉ«Ö±²¥s will get a respite, Laird said. Things aren't aggressively getting more expensive nor are they getting significantly cheaper, he added.

While grocery prices rose faster than overall inflation, Statistics Canada said the pace continued to slow. Grocery prices were up 5.4 per cent year-over-year in October compared with a 5.8 per cent move higher in September.

"I think ´ºÉ«Ö±²¥s are feeling quite stretched and it doesn't matter whether it is their mortgage renewal, grocery bill or cost of going on vacation," he said. "Everything is just more expensive than it was."

The continued cost of living could also leave homeowners with less wiggle room in their budgets to handle higher payments upon their mortgage renewal.

This report by ´ºÉ«Ö±²¥was first published Nov. 21, 2023.