More Young Icelanders Living With Their Parents During Pandemic Skip to content
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Photo: Golli.

More Young Icelanders Living With Their Parents During Pandemic

The percentage of young Icelanders who live with their parents has gone from 42% to 70% in less than a year, according to a survey Zenter performed for the Housing and Construction Authority. It’s clear that COVID-19 plays a role, as 18-24 year-olds’ unemployment has risen 134% in one year.

The Housing and Construction Authority’s economic report states that conditions for buying real estate have never been better, due to lower interest rates. The real estate market has been a busy one since the beginning of summer as more people have been able to buy real estate. This affects the rental market and a recent survey indicates that renters are getting fewer. Iceland’s rental market is an unstable one and not many people choose to rent if they have the option not to.

The percentage of people who rent their home hasn’t been lower since late 2008, just after the banking collapse. Since then, the percentage has hovered between 14-18%, averaging at 16%. Since mid-year 2019, the percentage has steadily gone down, from 18% July 2019 to 13% July 2020. This correlates with the timing of the Central Bank of Iceland lowering interest rates. The Housing and Construction Authority’s last rental survey indicated that nine out of ten would rather own their home than rent if possible.

Since the pandemic started, the supply of rental apartments has increased, rental prices have gone down and more people have the option of buying a home. According to the survey, only 14% of people believed COVID-19 had negatively impacted their position in the rental market. There’s one group however, that’s been disproportionately impacted by the pandemic, 18-24-year-olds. At the end of last year, only 42% of them were living at home with their parents but that number has risen steadily since then, reaching 70% in August. The tourism and hospitality industries, where many in this age group work, are going through a deep recession. Unemployment for people in this age group has more than doubled while at the same time, the percentage of employment overall has decreased by 14.5%. That’s a strong indication that economically speaking, the pandemic is hitting young people harder than others. They’re stuck living with their parents and aren’t entering the rental market or buying their own homes at the moment.

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