"Yet another knife in the back"

The Homes Association say that the Central Bank's raising interests again yesterday is "yet another knife in the back" of the homes in this country." Again, this will be hardest for those who have the least income and those who owe most money.

Interests gone up 340% in one year

"Raising interest is not a universal law and most certainly not in the volume that the Central Bank of Iceland has decided to use it in these times. The families and homes of this country will bear the brunt of the rising cost of products because of the inflation, but when the "cure" multiplies the burden, something has got to give. It is a fact that interests have gone up 340% in one year and 633% since their lowest point in May 2021," says in the announcement of the association.

In the announcement it is also reported that in the other Scandinavian countries everything is done in order to minimize the burden of the inflation that is caused by rising prises of the housing market. They point out that in Denmark the key interest rate are 0.1%, in Norway 1.75%, in Sweden 0.75% and in Finland 0.5%. In Iceland it is 5.5%.

Article on Iceland Monitor

The Central Bank raises its interests by 0,75 percentage points

"The Homes Association want, in a friendly manner, to tell the government and the Central Bank of Iceland that their actions to try to minimize the inflation is a lot worse for the homes in the country than the inflation itself. We encourage both parties to think about specific actions for those thinking about buying real estate, because adding this burden on all of those who are not buying real estate does not change anything in the housing market. In short, stop raising interests and thereby adding more financial pressures for the homes in the country, reset those high interests and just let the homes sail through the inflation," without making things much worse and then the coming negotiations with the unions this fall will go better, without a doubt."

The association pledge their support to the workers' unions that will lead the negotiations this fall, but also send the families who are now worried about the future their best wishes. "Our thoughts are with those who are stuck in the rental market, because their situation is really bad, and has been for a long time. Sadly, there doesn't seem to be any solution in sight."