Housing owners with properties on the market are now looking for ways to profit from their properties while the real estate market remains slow. Many are offering their properties for rent with the supply increasing considerably in July.
The Housing Financing Fund (HFF) has granted many more loans for rental apartments in July than in previous months. In July the fund granted ISK 1.9 billion (USD 23 million, EUR 16 million) in loans for rental apartments, an amount which usually does not surpass one billion per month, Morgunbladid reports.
Real estate agents have noticed increased participation in the rental market by building contractors, who are hoping to rent new apartments which remain unsold; more luxurious apartments are also entering the rental market.
“I believe large apartments are being added to the market, which tenants have to pay high amounts for every month. I don’t have the feeling that many more inexpensive apartments are being offered for rent,” said Gísli Örn Bjarnhédinsson, managing director of Búseti, a company which buys apartments to rent them out.
“I think people have greatly overestimated the market for luxury properties, especially for older people who are looking to move into smaller apartments,” Bjarnhédinsson said.