Construction Outside Reykjavík Reached Pre-Crash Levels

More apartments are being built outside the capital area now than in 2008, Vísir reports. Most of the construction is currently centered in the South, with over 1,100 apartments now under construction.

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These figures are available in the latest economic outlook report published by the economic department of Landsbanki. The report is based on the data provided by Statistics Iceland. According to the report, the housing prices in the capital area and outside of it are developing similarly, even though the prices for apartments outside Reykjavík are rising faster.

The report also states that the demand for housing has changed after the pandemic, resulting in rising sales and prices.

The residential market price index for detached houses in the capital area has increased by 22% since July last year. At the same time, multi-family units have gone up by 24%. Outside the capital area, the price index increased by 29%. Compared to February 2020, the residential market price index has gone up between 45-47% both in and out of the capital area.

As of the end of July, 2,672 apartments are under construction outside the capital area. This is 33% more than compared to the end of 2020 and the beginning of 2021.