With its otherworldly landscapes, clean energy, and stable economy, Iceland has become an intriguing destination for property buyers seeking natural beauty, privacy, and sustainability. From minimalist homes near Reykjavik to rural retreats overlooking glaciers or geothermal springs, the Icelandic property market offers distinctive lifestyle and investment appeal.
While opportunities exist, buying property in Iceland as a foreigner involves specific legal restrictions and administrative requirements — which is why working with a knowledgeable advisor like Fraser Bond is essential to navigating the market confidently.
Dramatic fjords, waterfalls, volcanoes, hot springs, and Northern Lights
Clean air, sustainable living, and outdoor lifestyle appeal
Strong legal system and transparent property ownership rights
Ranked among the world’s safest and most livable countries
Ideal for remote work, creative retreats, or eco-tourism ventures
Low population density, high quality of life, and strong infrastructure
Stringent planning laws and environmental controls limit overdevelopment
Properties are typically freehold, offering full ownership
Yes — but with restrictions.
Can freely purchase property in Iceland without restriction
Must apply for a permit from the Ministry of Justice
Approvals are granted if the buyer intends to establish a residence, business, or cultural contribution in Iceland
Note: Buying through an Icelandic company or establishing a legal presence in Iceland can improve eligibility.
Fraser Bond works with local legal experts to advise on eligibility and handle permit applications for international buyers.
| Property Type | Common Locations | Notes |
|---|---|---|
| Residential Homes | Reykjavik, Akureyri, Selfoss | Detached homes, apartments, new builds |
| Rural Cottages / Cabins | South Coast, Westfjords, Golden Circle | Often used for tourism or personal retreats |
| Commercial Real Estate | Reykjavik and major towns | Hotels, guesthouses, hospitality ventures |
| Land Parcels | Various scenic locations | May be subject to land use restrictions |
Iceland’s capital and economic centre
Vibrant urban lifestyle, strong rental demand, high-end apartments
Northern hub, known as Iceland’s “second city”
Slower pace, more affordable property, ski and outdoor appeal
Includes Þingvellir, Geysir, and Gullfoss
Popular for rural homes and short-let holiday cabins
Remote, rugged beauty — ideal for retreat-style properties
Limited infrastructure but growing tourism interest
| Property Type | Average Price Range (ISK) | Notes |
|---|---|---|
| 2-Bed Apartment in Reykjavik | ISK 50M – 80M (£290k–£470k) | High urban demand |
| Detached House (Urban/Suburban) | ISK 70M – 120M+ (£400k–£700k+) | Based on location and land size |
| Rural Cabin or Cottage | ISK 20M – 50M (£120k–£290k) | Often off-grid, with stunning views |
| Commercial Guesthouse | ISK 100M – 250M+ (£580k–£1.4M+) | Subject to permits and zoning |
Note: Prices are estimates and fluctuate based on exchange rates and regional supply.
Fraser Bond connects buyers with Icelandic property lawyers to assess eligibility and structure the purchase correctly.
Application to the Ministry of Justice for property ownership approval.
Title checks and land registry searches
Verifying planning status and usage rights (particularly for rural land)
Typically involves a 10–15% deposit and notarised documentation.
Final registration with the Icelandic Property Registry (FMR) and local municipalities.
Heating & Utilities: Most homes benefit from geothermal heating, which is clean and cost-effective.
Weather Resilience: Construction standards are high due to Iceland’s harsh winters and seismic activity.
Rental Potential: Properties near natural landmarks or cities may generate strong holiday rental income.
Financing: Mortgages for foreign buyers can be complex. Many international buyers purchase with cash.
Fraser Bond works with an exclusive network of Icelandic estate agents, legal advisors, and developers to support international clients throughout the property purchase process.
Pre-screened property options including homes, land, and investments
Guidance on eligibility, permits, and local regulations
Support with due diligence, translation, and legal documentation
Referrals for property management, short-let licensing, and maintenance
Advice on ownership structures and long-term investment strategies
Our goal is to make buying property in Iceland secure, transparent, and rewarding — whether for personal use, investment, or a mix of both.
Iceland is a country unlike any other — and owning property here offers a rare blend of tranquillity, security, and natural splendour. While the market is tightly regulated, buyers with the right guidance can secure stunning homes and long-term investments in this remarkable country.
Contact Fraser Bond today to start your Iceland property search and receive bespoke guidance tailored to your goals.
