Strætó Discontinues Night-Time Service During Weekends

Public bus in Reykjavík

Strætó has announced that it will discontinue its night-time bus service in Reykjavík during the weekends, citing low passenger demand during a special trial period. Strætó is facing financial troubles following the pandemic, and recently, the capital area municipalities had to divert extra fund to keep the regional partnership company from insolvency.

The night bus returns

In early July, Strætó (the public bus service in Iceland) announced that the Reykjavík night bus, Næturstrætó, would return to service on July 9 following a two-year hiatus in response to low demand during the pandemic. During this hiatus, many capital-area residents had called for its return, arguing that it provided an affordable and safe alternative to taxis.

During a trial run between July and October of this year, however – when the night bus departed downtown Reykjavík every hour and stopped at the capital area’s seven suburban neighbourhoods – demand once again proved wanting. As noted in a press release from Strætó, an average of 15 passengers travelled aboard the night bus during each trip, which amounts to approximately 300 passengers over a weekend.

“In light of this, and given the finances, Strætó’s board has agreed that continuing night-time service during the weekends, now that the trial period has concluded, cannot be justified. The service will, therefore, be discontinued.”

As noted by Vísir, transportation options from downtown Reykjavík after the night clubs have closed during the weekend are limited; operating electric scooters while intoxicated is illegal and securing transportation via taxis often proves difficult.

 

New Hospital Won’t Meet Bed-Demand, Report Finds

landspítali hospital

A new government report finds that the healthcare system will be significantly short of hospital beds by 2040, even with the new hospital opening on Hringbraut in Reykjavík. The Director of the new hospital hopes that the war in Ukraine won’t delay construction.

Demographic changes driving demand

On March 18, the Ministry of Health released a report on the future development of the National University Hospital of Iceland (Landspítali). The report, which was based on data from 2019, was predicated on analytical work done by the management consulting company McKinsey & Company.

Among the report’s main findings was that the need for hospital beds in Iceland is expected to rise by 80% by 2040. This need is driven mainly by demographic changes, with the average age in the country expected to increase by 9% and the total population expected to increase by 18% over the next 18 years.

Given these changes, the healthcare system would have only half of the needed hospital beds by 2040 if no significant actions were taken – even with the opening of the new hospital on Hringbraut (expected to open in 2026).

According to the report, the healthcare system can tackle the shortage by shifting long-term and primary care from Landspítali to “a more (sic) adequate healthcare setting.” The health authorities would need to create the equivalent of ca. 240 bed capacity in home-based, elderly, and rehabilitation-care facilities.

“We can’t lose any time”

In an interview with RÚV yesterday, Runólfur Pálsson, Director of the National University Hospital of Iceland, responded to the report by saying that “time was of the essence.”

“Everybody is familiar with the current facilities as far as hospital beds are concerned,” Páll observed. “Personnel shortage is also a growing concern. We should have acted sooner; the preparation time required for the construction of the new hospital was way too long.”

As noted on RÚV yesterday, the current conditions at Landspítali er still difficult, even with a decline in COVID-19 cases. There is a significant shortage of hospital beds. Every day, almost 30 people must wait in the emergency ward to be admitted into the hospital.

Furthermore, illnesses among staff, whether resulting from COVID-19 or influenza, have also made operations difficult. Many employees of the hospital have also gone on sick leave owing to work-related stress.

Construction, for the most part, “on schedule”

In an interview on Friday, Gunnar Svavarsson, Director of the New University Hospital on Hringbraut, stated that the construction of the new hospital was, for the most part, on schedule. The Russian invasion of Ukraine may cause a delay, however, as the contractors can no longer import steel from Russia.

“We hope there won’t be any delays,” Gunnar said. “As it stands, it’s looking pretty good. Some areas are behind schedule and others that are ahead of schedule.”

30,000 New Apartments Needed to Meet Demand

apartments downtown Reykjavík housing

An estimated 30,000 new apartments are needed in Iceland over the next decade to meet expected demand. Despite a record number of apartments having been constructed last year, the demand has only increased, according to the Housing and Construction Authority.

500 more apartments than originally estimated

At the beginning of 2021, the Housing and Construction Authority published a report on housing demand in Iceland. The original report estimated that 3,950 apartments would need to be constructed by the end of the year to maintain stability in the housing market. With the population growing at a quicker rate than previously expected, however, the Authority has updated its report, revising its estimate to 4,450 apartments.

In an interview with Vísir, Karlotta Halldórsdóttir – an economics specialist with the Housing and Construction Authority – stated that the demand for housing in Iceland was relatively high. “We are constructing approximately 3,000 apartments annually, which is quite good. However, its speaks to a considerable shortage, the fact that approximately 4,500 apartments are needed this year to meet demand.” Karlotta added that this shortage did not mean homelessness but rather that young adults would be living at home with their parents for longer, or that more individuals would be residing in non-residential buildings or unauthorised housing.

A shortage of plots

According to Karlotta, contractors have complained of a shortage of building sites, which municipalities must provide. “A shortage of plots is inhibitory to the construction of apartments. It appears as if contractors are capable of building more but that the paucity of land makes it difficult.”

A record number of new apartments were constructed last year, approximately 3,800. “In reality, it’s not the pace of construction; it’s just that there is great demand these days,” Karlotta remarked. Despite this increased demand, Karlotta encouraged buyers to remain patient.

“I think it’s important for buyers not to rush. More apartments will become available. We’re seeing a rise in prices, which most likely originates with a lack of supply, but buyers should take their time, as opposed to rushing to buy.”

Increased demand for larger homes

Earlier this month, RÚV reported that Landsbankinn’s Department of Economics had predicted a 10.5% increase in real-estate prices in 2021 compared to last year. Þorsteinn Arnalds, Director of the Housing and Construction Authority, stated that this increase was to be attributed to lower interest rates. Þorsteinn added that the pandemic has seen increased demand for larger, single-family homes.

“It’s clear that single-family homes, especially larger homes, have seen a rise in prices. Maybe this owes to the increased need for better and roomier housing following social restrictions. I don’t expect this trend to change in the capital area, as we don’t expect the supply of single-family homes to increase in the immediate future; it’s mainly apartment buildings that are being constructed.