Strong residential development in a cooling market
A lot of construction is going on in the capital region. mbl.is/Eggert Jóhannesson
Everything points to residential development being strong at this time and more apartments are expected on the market in the coming months and next years. There is a growing number of apartments under construction, and more apartments are under construction this year compared to last year. The number of people working in the construction industry is growing and turnover is increasing in the field.
This is reflected in Landsbanki’s Statistics.
It states that there are a total of 8,100 apartments under construction in Iceland,” according to a new census by the Federation of Icelandic Industries (SI) and the Housing and Construction Authority (HMS), which was presented in September. The apartments are 35% more than in September of last year and 12% more than in March of this year.
Double as many apartments being built compared to last year
“The number of new apartments in construction has increased since September last year, by 103%, and by 39% since March. By contrast, the number of apartments at construction level 7 that are almost ready, has decreased by 34%. Most of the apartments currently under construction have just been floodproofed (20%), close to being floodproofed (33%) or at construction level 1 (20%). This shows the strength of new construction projects and the fact that many new projects have started in the last few months. The impact of increased construction is therefore not necessarily immediate, but will be apparent after some months,” according to Statistics Iceland.
At the same time the market has been cooling due to rising interest rates and high inflation. However, there has been an unmet need in the market for more real estate for quite some time.
