Real estate investment in Iceland
Foreigners can buy, lease and sell properties without restrictions in Iceland. The sale of land to foreigners is prohibited. The land on which the house stands can be taken on a long-term lease.
Statistics confirm the liquidity of investments: every quarter, residential real estate prices grow by an average of 2.5%. Five years ago, an apartment of 100 m² cost an average of €267,000, and today it is sold for €440,000.
of housing in Iceland
increase per quarter
of the transaction amount
How the residential property price index is growing in Iceland
Cost of a 3-bedroom apartment in Iceland
Penthouse in Reykjavik
Attic apartment with an ocean view in Reykjavik
Apartment in Reykjavik
What do investors buy?
The most expensive real estate in Iceland is in the capital, Reykjavik.
- attic apartments
Iceland residence permit or citizenship by real estate investment
Obtaining an Iceland residence permit or citizenship is not connected with purchasing real estate.
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Taxes and associated costs
Owners of real estate in Iceland pay an annual municipal tax of up to 1.65% of the cadastral value. The tax rate depends on the municipality.
If the owner leases the property, they pay a 22% tax on rental income.
maintenance of an apartment
Electricity, gas, water, heating, and garbage collection
Internet, TV and telephone
Real estate sellers pay a capital gains tax of 22% on the difference between the sale and purchase prices.
real estate in Iceland
Capital gains tax
Paid on the difference between the sale and
Frequently asked questions
Foreign nationals who are domiciled in Iceland, as well as European Economic Area nationals, can buy, sell, or rent out real estate without restrictions. But the sale of land to foreigners is prohibited — the land on which the house stands can be long-term rented.
Other types of foreign nationals need to obtain a permit from the minister of justice for buying real estate in Iceland.
The average cost of housing in the country is €4,405 per 1 m². The most expensive housing is in Reykjavik, the capital of Iceland, where the average cost is €6,200 per 1 m².
Buyers of real estate in Iceland pay a stamp duty of 0,8%.
Property owners in Iceland also pay an annual municipal tax of up to 1,65% of the cadastral value of the property. The tax rate depends on the municipality.
While each instant is unique, real estate buyers in Iceland should estimate a 3—4 week process, from searches for the best property to ownership registration. Note that foreign nationals that are not domiciled in Iceland, or are outside the European Economic Area, need to obtain a permit from Iceland’s minister of justice for buying real estate.