Desjardins published its Ontario housing outlook on October 21. The report's narrative covers Toronto's condo collapse, Ottawa's public-service cuts, Hamilton's steel exposure, Niagara tourism, northern mining towns and cottage country. London and Windsor don't get a section. They appear only in the appendix tables.[1]

Read those tables next to the latest Statistics Canada and CMHC releases, though, and southwestern Ontario's two largest markets look like they are heading in opposite directions. London is building faster while its job market weakens. Windsor is hiring again while construction slows. For anyone underwriting rental housing in either city, that gap matters more than the provincial averages.

The numbers side by side

Construction. CMHC's September release shows London started 3,085 homes in the first nine months of 2026, up 28% from 2,403 a year earlier. Starts other than single-detached homes, which include apartments, rose 31% to 2,669. Windsor went the other way: 690 starts year to date, down 21%, with non-single-detached starts down 30% to 433.[2] On Desjardins' annualized measure, London is tracking about 3,946 starts this year compared with 3,106 in 2025. Windsor is tracking 909, compared with 1,262.[1]

Jobs. Statistics Canada's Labour Force Survey for September, released October 9, shows London's employment at 311,200 on a three-month average. That is 19,500 fewer jobs than a year earlier, a 5.9% drop. The unemployment rate was 8.4%, up 2.1 points from a year ago. Windsor's employment was 245,300, up 11,300 or 4.8%, and its unemployment rate fell 3.1 points to 7.3%.[3] Desjardins' year-to-date averages, which cover all of 2026 so far, show employment down 7.2% in London and down 0.8% in Windsor, a sign that Windsor's gains are recent.[1]

Population. Neither city is growing quickly. Desjardins puts 2026 population growth at 0.7% in London and 1.1% in Windsor, against 0.4% for Ontario.[1]

Rents and vacancy. CMHC's last Rental Market Survey (October 2025) put London's purpose-built apartment vacancy at 4.0%, up from 2.9% a year earlier. Windsor's was 3.7%, up from 3.3%.[4] Asking rents have softened in both. Rentals.ca and Urbanation's September data showed London one-bedroom asking rents down 4.7% from a year earlier and two-bedrooms down 4.6%. In Windsor, one-bedroom asking rents fell 12.6%.[5]

Why London's combination deserves attention

Rental demand depends on household formation, and household formation depends on jobs. London is adding supply at a faster pace while its labour market loses ground. That combination usually shows up first as longer lease-up times and more incentives, and only later in average rents.

The pipeline is large relative to the market. CMHC counted 5,857 homes under construction in London in September, and 2,644 more approved units waiting to start, up from 1,899 in August.[2] By comparison, CMHC's 2025 survey counted 49,202 units in London's purpose-built rental universe.[4] Not every home under construction is a rental, so the comparison is rough. Even so, the pipeline equals roughly 12% of the existing purpose-built stock, against about 7% in Windsor (1,303 under construction against a 19,042-unit universe).

There are reasons not to overread one survey. Labour Force Survey estimates for mid-sized metro areas are volatile, and a three-month average can swing on a few large employers or on changes in sampling. London's labour force also shrank by 13,300 people over the year, which suggests some people stopped looking for work or left the area rather than simply losing jobs.[3] September itself was a quiet month for London construction: actual starts were 223, down from 1,102 a year earlier, which hints that the year-to-date surge was front-loaded.[2]

What Windsor's numbers do and don't say

Windsor's improvement is real but narrow. Unemployment was above 10% a year ago and is now 7.3%, but the year-to-date employment figure is still slightly negative.[1][3] The local economy remains tied to manufacturing and cross-border trade, which keeps tariff risk in the picture.

Fewer starts in a city that is adding jobs points to tighter conditions ahead. The steep fall in Windsor's one-bedroom asking rents shows that hasn't happened yet. Listings data reflects units advertised for rent, not rents paid by sitting tenants.[5]

The interest rate overlay

Desjardins expects the Bank of Canada to raise its policy rate twice, starting in late October, and expects bond yields to stay elevated by historical standards.[1] The Bank's next decision is October 28.[6] Higher rates hit projects still in construction or lease-up harder than stabilized buildings, so they matter more in London, where more rental units are still being built.

For Ontario as a whole, Desjardins forecasts rental vacancy at 3.2% this year and 3.3% in 2027, with average rents up 1.2% and 1.4%. It notes that the outlook depends heavily on the federal immigration levels plan expected in the coming weeks.[1]

What to watch

  • London lease-up pace. New buildings delivering into a weaker job market will show stress first in concessions and absorption time, not in published average rents.
  • The October Labour Force Survey, due in early November. One more month will show whether London's job losses are levelling off or continuing.
  • CMHC's 2026 Rental Market Survey, expected in December. It will be the first official vacancy reading that captures this year's new supply in both cities.
  • Windsor permits. Approved units waiting to start rose to 417 in September from 250 in August.[2] If those convert to starts, Windsor's supply gap may narrow faster than the year-to-date figures suggest.

The takeaway

Southwestern Ontario is often treated as one market. The current data says otherwise. London has momentum on supply and weakness on jobs. Windsor has the reverse. Neither picture is settled, and both rest partly on noisy local surveys. But an investor looking at the region should be underwriting the two cities differently: in London, the question is how quickly new units fill; in Windsor, it is whether a recent recovery in jobs will last long enough to absorb the units that aren't being built.

This article is for information only and is not investment advice.

Sources

[1] Ontario Housing Outlook: Condos, Cottages, Copper Country and Canada's Capital, Desjardins Economic Studies (Oct. 21, 2026): https://www.desjardins.com/content/dam/pdf/en/personal/savings-investment/economic-studies/ontario-housing-outlook-october-2026.pdf

[2] Housing starts and construction data for September 2026, CMHC (Oct. 16, 2026): https://www.cmhc-schl.gc.ca/media-newsroom/news-releases/2026/housing-starts-construction-data-september-2026

[3] Labour Force Survey, September 2026, Table 7: Labour force characteristics by census metropolitan area, Statistics Canada (Oct. 9, 2026): https://www150.statcan.gc.ca/n1/daily-quotidien/261009/t007a-eng.htm

[4] Rental Market Report 2025 (Ontario data tables), CMHC (Dec. 11, 2025): https://www.cmhc-schl.gc.ca/professionals/housing-markets-data-and-research/market-reports/rental-market-reports-major-centres

[5] October 2026 National Rent Report, Rentals.ca and Urbanation (Oct. 7, 2026): https://rentals.ca/national-rent-report

[6] Interest Rate Announcement and Monetary Policy Report, October 28, 2026, Bank of Canada: https://www.bankofcanada.ca/2026/10/interest-rate-announcement-and-monetary-policy-report-october-28-2026/