What's the Housing Market like in Iceland? Let's Learn

By
Real Estate Agent with Samson Properties VA0225077251

I'm a passionate traveler and always intrigued by the real estate world. Two weeks ago,  I was in Iceland and I've got to say, this country is one of a kind. On top of that, I took the opportunity to learn more about how real estate works there. Here's a bit about Iceland, the land of fire and ice, and how different and unique their housing market is.

mountains near body of water

Rent vs. Owning a Home

Most people in Iceland would prefer to own their property instead of renting. About 80% of Icelanders own their housing, and that's a higher number compared to the US, which is at a bit over 60%.

aerial view of city buildings during daytime

Mortgage and Financing

While mortgage is relatively easy, the Icelandic system requires a person to be financially viable just like in the US. A minimum of 15% downpayment in cash is required to proceed and borrow about 80-85% depending on your financial situation.

laptop computer on glass-top table

Pricing and Interest Rates

A condo around 90-100 square meters is at around kr 500,000 per square meter, which is quite expensive. There are two financing systems -- a simple fixed interest rate, and another one that corrects your payment according to inflation before adding the interest rate, which sounds complicated. The second system is created to help the banks not to lose money, which is a response to the 2008 financial crisis. Comparing the Icelandic financial system, it's more complicated than the usual black-and-white financing in the US which is pretty straightforward.

Speaking of inflation, the inflation rate in Iceland is at around 3-4% at a 10-year data which is not bad compared to other European countries. Europe aims to stay within the 3% inflation rate and is doing quite well over the past 10 years

grey concrete building

With that in mind, banks are getting the help they need to keep up with the economy, and inflation rate is keeping up in Iceland so far. Overall, aside from the beautiful scenery and an awesome culture it offers, Iceland has its unique financing system and they're hoping for the best. 

Want to see my journey to Iceland? Check them out and give me a follow on Instagram: instagram.com/varealestate. Thinking about selling your property today? Let's talk -- 703-625-4949 or email at info@enovahomes.com. Make your move today!

 

 

Posted by

 
                             
Associate Broker
MRP, ABR, ePRO

NVAR, Life Time Top Producer
NVAR,Multiple Million Dollar Sales Club Member
Samson Properties
Cell - 703-625-4949
Email - info@eNOVAHomes.com
Web: www.eNOVAHOMES.com
 
Residential real estate agent serving Northern Virginia in Fairfax & Loudoun county over a decade and almost $100+M in sales volume experience. 


 

Comments (3)

John Marshall - FORE!
LoKation Real Estate - Cherry Hills Village, CO
Specializing in Golf Course Properties

Very interesting Ritu Desai I have a niece that travels frequently and Iceland is her favorite place to visit, she says it is so beautiful and your pictures seem to prove that is correct!

Aug 23, 2021 12:47 PM
Ritu Desai 703-625-4949

Indeed it is a beautiful place. I high recommed 1st going in the winter and later again in the summer. 

Aug 26, 2021 04:41 AM
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hello Ritu - how nice that you were able to combine two pleasures into one trip.  The perspective you experienced first hand is a terrific lesson.  

Aug 24, 2021 05:31 AM
Ritu Desai 703-625-4949

It was a great experience. It is an honor to be able to travel and learn so much about people, their challenges, and how positive. Thank you so much for reading my blog.

Aug 26, 2021 04:42 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Interesting overview of the real estate market in Iceland. What I found so wonderful about Iceland was the FishMarket! Yummmmmm

Aug 24, 2021 06:10 AM
Ritu Desai 703-625-4949

Yes, it has the largest Whale Watching and fishing industry. Their staple food is dried fish as a snack. 

Aug 26, 2021 04:42 AM