If you gave the average person $100 while walking by them on the street they would probably ask questions. “Is this real?” “Why are you giving this to me?” Imagine you told them the money was free. More often than not, they would repeat the age old phrase: there’s no such thing as free money.
Written By: Natasha Kozak
The rental market is no stranger to the students of Waterloo, Ontario. Everywhere you look there are “for rent” signs in windows, and major housing corporations seem to be taking over, as there seem to be more high-rise student apartment buildings than geese on UW campus. Increasing availability of student housing is a positive thing, as it gives more options for incoming students. However, even though supply of housing is increasing, rental prices are increasing as well. How is this so? Given the basics of supply and demand this phenomenon seems to defy economics. In this article we will look at the discrepancy in rental rates between landlords and tenants and tenant sublets. We will then explore reasons for this discrepancy, and pinpoint who is absorbing the deadweight loss (which, as any student of economics would know, is a less-than-pareto optimal position in which to be).