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Iceland · Housing & Relocation

Renting in Iceland

Verified data Last verified June 15, 2026 Reviewed by Henry van de Vorming

Iceland's rental market is small, tight and concentrated in the greater Reykjavik area, where roughly two-thirds of the population lives and where immigration has outpaced housing construction. Foreigners rent under the same rules as locals (Rent Act No. 36/1994), with no nationality-based restrictions. The market is unusual in that there is no single dominant portal: listings are spread across rental portals, newspaper classifieds and, above all, very active Facebook groups, and good listings can disappear within hours. Long-term leases are usually unfurnished (fixed-term or open-ended/indefinite), while furnished stock concentrates in the short/mid-term Airbnb-and-guesthouse segment that newcomers typically use as a 2-4 week bridge on arrival. Deposits are capped at three months' rent and must sit in a separate interest-bearing account. Anyone staying six months or more must register a legal domicile (lögheimili) with Registers Iceland, which requires a national ID number (kennitala) and a real street address.

The rental basics

Typical lease
1 year
Deposit
3 mo rent
Furnished
Furnished + unfurnished
Mid-term market
Moderate mid-term market
Address registration
Required

Agency fee: Agency/broker fees are not a standard cost for renters: the dominant channels are landlord-direct via Facebook groups, rental portals and large property-management companies (e.g. Heimstaden, ALMA) rather than letting agents. Deposits may take the form of a monetary deposit (held in a separate interest-bearing account), a bank guarantee, third-party/personal guarantee, an insurance policy or a mutual insurance fund.

Address registration

Anyone planning to stay in Iceland six months or longer must register a legal domicile (lögheimili) with Registers Iceland (Þjóðskrá), and any change of address must be reported within seven days. Registration requires a national ID number (kennitala), a residence permit for non-EEA nationals, and a definite physical address on a named street or in a named building — guesthouses, hospitals, worker accommodations and construction camps do not qualify. A person may hold only one legal domicile at a time, which is also a precondition for public health insurance (coverage generally begins six months after registration; EEA citizens previously insured in another EEA country may apply from the day they register). Separately, from 1 January 2026 all landlords must register tenancy agreements in the HMS Rent register.

Your rights as a tenant

Tenancies are governed by the Rent Act No. 36/1994, which leans pro-tenant: the Act applies even if no written contract is drawn up, and contractual terms less favourable to the tenant than the legal minimum can be voided in a dispute. Lease agreements must be written, and where a deposit/surety is required the maximum is three months' rent. The deposit must be held in an unrestricted, interest-bearing account (interest accrues to the tenant) and, if no written claim is made within four weeks of the premises being handed back, must be returned with accrued interest. Leases may be fixed-term or open-ended/indefinite; open-ended contracts give tenants stronger protection. Initial rent is freely negotiated, but in open-ended leases rent may generally be raised only once a year and typically only in line with inflation/CPI or as stipulated in the contract.

Good to know

  • Same rental rules apply to foreigners as to locals; no nationality restrictions, and tenant rights are protected by the Rent Act No. 36/1994
  • Deposit is capped at three months' rent, must sit in a separate interest-bearing account, and is returned with accrued interest if no written claim is filed within four weeks
  • Facebook groups (largest, 'Leiga', has 60,000+ members) plus portals like myigloo.is, Leiga.is, Bland.is and mbl.is are the main ways to find a home — there is no single dominant portal
  • Most landlords deal directly, so renters typically avoid letting-agent commission fees

Watch out for

  • The Reykjavik market is very tight: vacancies are low, competition is intense, and good listings can be gone within hours — line up viewings fast
  • Long-term leases are usually unfurnished; furnished stock concentrates in the short/mid-term (Airbnb, guesthouses), often used as a 2-4 week bridge on arrival
  • Rental scams target foreigners — be wary of 'landlord abroad' listings that demand a deposit before any viewing
  • Registering a legal domicile (lögheimili) requires a kennitala and a qualifying street address, and is a precondition for public health insurance — guesthouse/hostel addresses are not accepted

Where to look

Igloo / myigloo.isLeiga.isBland.ismbl.is (Morgunblaðið classifieds)Facebook groups (e.g. 'Leiga', 60,000+ members)

Platforms are listed for orientation only — we don't endorse or rank them.

Renting in Iceland: FAQ

Renting in Iceland: FAQ

How much deposit do I need to rent in Iceland?

Landlords typically ask for around 3 months of rent as a security deposit, on top of the first month upfront, plus any agency fee (agency/broker fees are not a standard cost for renters: the dominant channels are landlord-direct via facebook groups, rental portals and large property-management companies (e.g. heimstaden, alma) rather than letting agents. deposits may take the form of a monetary deposit (held in a separate interest-bearing account), a bank guarantee, third-party/personal guarantee, an insurance policy or a mutual insurance fund.). Budget for that as a lump sum before you arrive.

Do I have to register my address in Iceland?

Yes — Anyone planning to stay in Iceland six months or longer must register a legal domicile (lögheimili) with Registers Iceland (Þjóðskrá), and any change of address must be reported within seven days. Registration requires a national ID number (kennitala), a residence permit for non-EEA nationals, and a definite physical address on a named street or in a named building — guesthouses, hospitals, worker accommodations and construction camps do not qualify. A person may hold only one legal domicile at a time, which is also a precondition for public health insurance (coverage generally begins six months after registration; EEA citizens previously insured in another EEA country may apply from the day they register). Separately, from 1 January 2026 all landlords must register tenancy agreements in the HMS Rent register.

Can I find furnished or short-term rentals in Iceland?

Furnished + unfurnished and the mid-term market nomads rely on is moderate mid-term market. Start your search on Igloo / myigloo.is, Leiga.is, Bland.is.

Sources