Property prices go down in the capital area

During the last year, the price of apartments in the capital area has decreased by 5.7% when compared to the consumer price index.

For the first time since 2014, the real price drop is measured in apartments in the vicinity of the capital area.

This is reflected in the monthly report of the Department of Housing and Infrastructure.

Article on Iceland Monitor

122% hike in property prices

“The Capital Area Residential Price Index decreased by 1.1% in June. The decrease in the number of residential residences was just 1%. In the surrounding area of the capital area, prices decreased by 2.1% and in the rest of the country by 0.5%,” the report stated.

Real prices have increased in the last months elsewhere in the countryside, but the report from the Housing and Infrastructure Agency points out that the increase in dwelling prices was somewhat less in 2020-2022 in the countryside than in the capital area and its surroundings.

Rate not lower since 1997

In addition, the proportion of mortgages on residential property by households has not been lower since 1997, but the figures from Statistics Iceland do not go beyond that. The proportion was 27% at the end of last year.

The population in Iceland could reach 400,000 by the end of the year, but the population has grown the most in the vicinity of the capital area.