Published November 10, 2025

Following a Supreme Court judgement last month, the Icelandic banks changed their mortgage offerings. Result: Normal people can not take a loan to buy a home in Iceland. In the past 15 years this has become exponentially more difficult. This is because housing in Iceland has become an investment opportunity first, home second. The added pressures of tourism have sped up the trend.  

Any union leader asked in any interview over the past decade has pointed out that it doesn’t really matter what agreement is reached in the next collective bargaining deal on wages, as long as the housing market sucks an ever larger portion of people’s paycheck every month. Funny enough, the unions in question also happen to run the pension funds. The pension funds own the banks and the large real estate companies. The profits on the housing market made on the behalf of the union-run pension funds are supposed to pay for the pensions of those same union members, whose wages can’t keep up with their rent or mortgage payments. They are skinning themselves now to pay for their retirement later. 

In a country that did not develop a rental market alongside private ownership of homes like its Scandinavian neighbours, we only have one system. That system is now so broken that most if not all measures introduced by the government last week to counter it seem like just putting lipstick on a pig.

A dead pig.