Housing Financing Fund Owns 570 Apartments Skip to content

Housing Financing Fund Owns 570 Apartments

The state-run Housing Financing Fund (HFF) now owns 570 apartments, according to statistics compiled for the Althingi parliament’s Budget Committee this week. At the beginning of March, the HFF came into possession of 120 apartments in east Iceland.

From Reykjavík. Photo by Páll Stefánsson.

The apartments went into the HFF’s ownership due to the bankruptcy of a rental housing company, which owned seven large apartment complexes, four in Reydarfjördur and three in Egilsstadir, Morgunbladid reports.

Since the banking collapse of October 2008, the number of apartments owned by the HFF has increased rapidly. In comparison, the HFF usually owned around 50 apartments at a time before the crash, according to Gudmundur Bjarnason, the HFF’s managing director.

Bjarnason said the HFF must try to rent these apartments because it has proven difficult to sell them and profits must be made somehow. Currently, around 100 apartments in the HFF’s ownership are on the rental market.

A law amendment was made last year permitting the HFF to rent apartments. Special regulations apply.

The individual losing an apartment has the right to reach an agreement with the HFF on the rental price and other items before it is advertised for rent, if the owner losing the apartment has tenants, they have priority, and finally, the HFF is not to compete with other rental companies.

Bjarnason said the HFF is likely bound to write off some of the mortgages it granted but it is difficult to predict how high the write-offs will be as a payment adjustment scheme for debtors has just been established at the banks.

Click here to read about new resources for homeowners in debt.

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