Reykjavik, Iceland
The world's northernmost capital, a vibrant Nordic city of colorful houses, geothermal pools, and dramatic volcanic landscapes.
Below Average vs Iceland Avg (100)
Above Average
Household income
Job market health
Reykjavik vs Iceland Average
Taxes
- State Income Tax: 31.5%
- Sales Tax: 24.0%
Economy & Jobs
- Median Income: ISK 7,200,000
- Unemployment: 3.5%
- Population: 139,000
Climate
- Sunny Days: 130/year
- Summer High: 57°F
- Winter Low: 30°F
- Farming Zone: USDA Zone 5b
Housing
- Median Home: kr55,000,000
- 1BR Rent: kr220000/mo
Cost of Living
Reykjavik's cost of living index is 95 (Iceland average = 100).
| Category | Reykjavik | National Average | Difference |
|---|---|---|---|
| Overall | 95 | 100 | -5.0% |
| Housing | 110 | 100 | +10.0% |
Data source: Council for Community and Economic Research (C2ER), 2026
Housing Market
| Metric | Value |
|---|---|
| Median Home Price | kr55,000,000 |
| Median Rent (1BR) | kr220000/mo |
| Median Rent (2BR) | kr275,000/mo |
| Price per Sq Ft | kr36,666 |
Data source: Zillow Research, 2026
True Cost of Home Ownership
Utilities
Estimated monthly utility costs for a typical household in Reykjavik:
| Utility | Estimated Monthly Cost | Notes |
|---|---|---|
| Electricity | kr10000 | |
| Heating & Cooling | kr136 | Estimated based on local climate. |
| Cooling (AC) | N/A | Estimated based on local climate and electricity rates |
| Water | kr3000 | Includes sewer |
| Internet (100+ Mbps) | kr7000 | Broadband average |
| Garbage / Trash | Included in taxes | Municipal service (covered by property taxes) |
| Total Utilities | kr20136 | Monthly estimate (including heating & cooling) |
Data sources: U.S. Energy Information Administration (EIA) 2024, EPA/AWWA water rate surveys, BroadbandNow
Remote Work Score
Reykjavik scores —/100 for remote work readiness:
Climate
Reykjavik has a varied climate with distinct seasons.
| Month | Avg High | Avg Low | Rainfall |
|---|---|---|---|
| January | 50°F | 30°F | 2.5" |
| April | 42°F | 45°F | 2.8" |
| July | 57°F | 32°F | 1.5" |
| October | 37°F | 48°F | 2.2" |
Cool — many vegetables, some fruit trees
Natural Hazards
Reykjavik faces the following natural hazards:
Highly active volcanic region with frequent eruptions.
Seismic activity on the Mid-Atlantic Ridge.
Severe winter storms.
Volcanic terrain with avalanches.
Glacial flood risk.
Volcanic terrain with landslides.
Based on historical records and geographic risk assessment.
Taxes
- State Income Tax: 31.5%
- Sales Tax: 24%
- Property Tax: ~0.5% of assessed value
Economy & Jobs
Major industries include technology, healthcare, education, and manufacturing. The unemployment rate is 3.5%.
Schools & Education
Academic Schedule
Standard academic calendar.
Important Disclaimer: All data on this page is for informational purposes only and does not constitute financial, legal, tax, or real estate advice. URCity and Northshore Press are not financial advisors, tax professionals, or real estate agents. Always consult qualified professionals before making relocation or financial decisions.
Frequently Asked Questions
What is the cost of living in Reykjavik, Iceland?
The cost of living index in Reykjavik is 95, which is Lower the Iceland national average of 100.
How much does it cost to buy a home in Reykjavik?
The median home price in Reykjavik is kr55,000,000. The housing index is 110.
What is the average rent for a 1-bedroom apartment?
The average rent for a 1-bedroom apartment in Reykjavik is approximately kr220000/mo.
Does Reykjavik, RE have income tax?
Reykjavik is in RE, which has an income tax rate of 31.5%.
What is the climate like in Reykjavik?
Reykjavik enjoys approximately 130 sunny days per year. Summer highs reach around 57°F, while winter lows can drop to around 30°F.
Data Sources
- Cost of Living: Council for Community and Economic Research (C2ER), 2026
- Housing Data: Zillow Research, 2026
- Income & Employment: US Census Bureau American Community Survey, 2024
- Utilities U.S. Energy Information Administration (EIA) 2024, EPA/AWWA water rate surveys, BroadbandNow
Data last updated: August 12, 2026. Data may not reflect current market conditions. Always verify with local sources before making relocation decisions.