Life in Iceland in 2009
How are households doing?
Pay buys a lot less
Kibba: A basket of food that cost $81 a year earlier now costs $95. Pay buys a lot less than a year earlier: purchasing power fell 7.2%. In our example loan, the monthly payment equals 42% of median pay before tax.
- No overall score here: each section below stands on its own.
Household money
The household in numbers
- Purchasing power in 2009 −7.2% Pay rise above inflation
- Inflation with housing — CPI in 2009 12.0% 12-month change in consumer prices
- House prices in 2009 −20.1% Change above inflation
- Unemployment in 2009 8.3% Share of the labour force out of work
Food
- Food prices in 2009 +17.5% All prices: 12.0%
🧺 A basket of food that cost $81 a year earlier now costs $95
Loan example (a standard comparison)
A standard example of the cost of a new loan against one person's wage, not the measured burden of Icelandic households.
Assumptions of the example
A standard example with fixed assumptions, to compare the cost of a new loan between years: the same home, a loan of ISK 50 million in 2025 money, adjusted for house prices, over 40 years without indexation, at the central bank rate + 1.5 points as a stand-in for mortgage rates. It does not show what households actually pay: most have older loans, other rates, indexation or two incomes.
- Interest rate (estimate) 13.29%
- Term 40 years
- Median monthly wage $2,957
- Monthly payment (interest and principal) (Exact values) $1,254
- Share of the median wage 42.40%
Before 2010 most Icelandic home loans were indexed with lower interest rates, so this non-indexed example overstates the burden in those years. It is still used in the score and warning lights for those years, which pulls the score down.
Your settings only change this loan example. The score always uses the fixed example.
- Rent in 2009 +15.6% All prices: 12.0%
Energy costs
- 💡 Electricity & heating in 2009 +9.5% All prices: 12.0%
- ⛽ Petrol & diesel in 2009 +8.2% All prices: 12.0%
🧾 A monthly electricity and heating bill of $162 a year earlier now costs $177
🚗 A tank of fuel that cost $121 a year earlier now costs $131
Energy combined (weights 46% electricity and heating, 54% fuel): +8.8% in nominal terms. Headline inflation was 12.0%, so relative to inflation the change is −2.9%. That figure goes into the score.
Change in price from the year before (CPI subindices). Heating is mostly geothermal hot water.
People and services
People & health
- Residents and estimated overnight guests average over 2009 324,310 318,499 residents + 5,811 foreign guests a night
- Most in Jul 2009 336,305 of whom 17,806 foreign guests a night
- Population at year end 317,630 ▼ −0.5% during the year
- Net migration (2009) −4,835
- Hospital beds (2009) 1,178 3.3 per 1,000 people · −5.1% from the year before
Residents plus the foreign guests staying each night on average: foreign overnight stays in registered accommodation (Statistics Iceland, SAM01601) divided by the days in the month. Guests in unregistered lodging, with friends or on cruise ships are not counted, and residents who are abroad are not subtracted, so the figure is a rough estimate.