This land of ice and fire is a breathtaking destination to call home. Not only does it have beautiful landscapes and breathtaking natural features, but it also offers relatively inexpensive healthcare and education.

However, with one of Europe’s highest living expenses, Iceland is infamously pricey. The Aurora Borealis, geysers, and hot springs are all around you, but this natural paradise won’t come cheap.

Living In Iceland_ A Bird’s Eye View On The Nordic Life.jpg

With that out of the way, let’s explore how life is while living in Iceland!

Quick Summary

The high standard of living, pristine natural surroundings, and friendly people- all influence expats to fall in love with Iceland. However, Iceland shares the reputation of other Nordic nations for its high cost of living. According to Numbeo, a four-member family’s monthly cost is approximately $61,395 (without rent), while an individual’s monthly expense is approximately $16,611 (without rent). Read more to explore the several factors that influence the expat cost of living in Iceland.

Source: Numbeo

Average Cost Of Living In Iceland 

With high employment and salaries, Iceland is both costly and a top-tier country. It is above average in terms of wealth and income. Monthly accommodation, utilities, food, transport, and entertainment cost a minimum of $61,378

For your convenience, we have compiled a basic breakdown of Iceland’s cost of living:

Category Description Cost
Housing Cost (Rent Per Month) 1 Bedroom Apartment in City Centre $22,469.57
1 Bedroom Apartment Outside of Centre $19,809.51
3 Bedroom Apartment In City Centre $32,074.92
3 Bedrooms Apartment Outside of Centre $28,446.55
Cost For Purchasing Apartment In the city center per square meter $75,390.51
Outside of the city center per square meter $60,586.27
Transportation Cost One-way Local Transport Ticket $51.99
Regular Price/ Monthly Pass $850.71
Taxi Starting (Normal Tariff) $69.00
Taxi (1 km) $30.63
Taxi (1 hour Waiting) $84.74
Gasoline (1 liter) $29.43
Volkswagen Golf 1.4 90 KW Trendline (Or Equivalent New Car) $491,048.75
Toyota Corolla Sedan 1.6l 97kw Comfort (Or Equivalent New Car) $536,615.75
Groceries Cost 1 L Milk $1.5
1 kg Rice (White) $39.89
1 kg Local Cheese $191.07
1 kg Chicken Filets $240.07
1 kg Apple $40.72
Restaurant Cost Meal, Inexpensive Restaurant $273.17
Meal For 2 (Mid-range Restaurant) $1,512.37
Cappuccino (Regular) $62.96
Pepsi/Coke (0.33 liter bottle) $36.80
Monthly Utility Costs Basic (Electricity, Cooling, Heating, Water, Garbage) for 85m2 Apartment $1,389.62
Mobile Phone Calls and 10 GB Data Plan $305.05
Internet (60Mbps, Unlimited Data, Cable/ADSL) $896.03

 

Why Is Iceland Expensive?

So, what gives Iceland’s exorbitant cost of living?

Geographical isolation plays a role to some extent. This leads to an increase in the high cost of importing goods and consumer rates. This smaller Nordic nation can’t produce as much of their goods as bigger ones. There is a high food importation rate since the country’s environment makes it difficult to cultivate certain fresh foods.

Even Iceland’s taxes are high. Products and food are both affected by high VAT rates. Although food is subjected to a somewhat lower rate of VAT than other goods. A high income tax also raises the cost of labor, which forces many businesses to raise prices to compensate.

Also, it’s pretty pricey to buy or rent a house in Iceland. Right now, there is a lot of competition in the home and rental markets. Although it is a small country, it has seen a lot of tourists and people move there in the last few years. This has greatly increased the need for housing, which has caused prices to rise.

5 Perks Of Living In Iceland

Perks Of Living In Iceland

Anyone thinking about making Iceland their permanent home should weigh the positive aspects. The breathtaking scenery is the main attraction. From the hypnotic northern lights to the seemingly endless summer days, the panoramas here are stunning. This Nordic country is a fantastic place to call home for many reasons. 

1. Safety 

Reasonably low crime rates have earned Iceland a reputation as one of the world’s safest nations. In Iceland, safety goes beyond exterior dangers. 

The resident’s inner serenity and security matter. It’s unusual to commit theft or more serious crimes. The nation has no army or police with firearms. Don’t be surprised if you see many parents letting their kids play outdoors unsupervised. 

2. Healthcare 

Although Iceland’s healthcare isn’t free, the government’s program does a lot to keep costs down. This operates using a capped setup. 

If your monthly healthcare costs are less than a certain threshold, any further treatments will not cost you a dime. You have a reduced monthly limit if you’re a youngster, over 67, or handicapped. 

Take note that Iceland’s public health care system is only available to people who have stayed there for six months. 

3. High Quality Of Life

Icelanders have a high-quality life. All the credits go to healthcare and educational institutions. 

4. Inclusive Society

With festivals like Peykjavik’s Gay Pride honoring love in all its manifestations,  Iceland shines as a symbol of LGBTQ+ equality. Aside from its remarkable gender equality, this nation is notable for its women’s active political engagement and almost nonexistent income difference. 

Icelanders are famously kind and helpful to visitors, demonstrating the country’s strong sense of community. Also, Iceland’s literary canon, musical styles, and linguistic traditions are distinct. 

5. Outdoor Activities

You can explore the great outdoors with a variety of Icelandic activities, including skiing, hiking, and fishing. 

Start your adventure with a 5-day trip to Iceland! Discover waterfalls, geysers, and beaches. Plan your journey today!

Visa And Residence For Iceland 

Even though just 350,000 people live in Iceland, the country receives over 2 million visitors yearly. Due in significant part to the country’s thriving tourist industry, Iceland expects to require an extra 30,000 foreign workers by 2030

The first thing to think about and figure out while planning a move to Iceland is which visas you are qualified for. You can get permanent residence in Iceland with certain visas but not others. An additional residence permit application is required of all expat visa applicants. 

Many Americans have made the journey to Iceland, even though immigration to the country is notoriously tough and complicated. There will be different criteria for each kind of visa that Iceland offers. 

Living or traveling to Iceland is a breeze for citizens of the European Economic Area or the European Free Trade Association. However, to do so as a non-EEA citizen, such as an American citizen, you will have to get a Spouse Visa, Student Visa, Family Visa, or Family Reunification Visa. 

Moving To Iceland 

If you are a citizen of the United States, the country’s permissible activities are somewhat limited. A residence permit application must be submitted to the Directorate of Immigration for stays exceeding three months; the approval of such an application is contingent upon the grounds for the applicant’s intended stay. 

Being a competent student, worker, au pair, volunteer, or wanting to reconnect with a family member) spouse, minor, or elderly parent) are all examples of often-accepted reasons. Depending on the specifics of each case, residence is evaluated. 

Additional documentation such as proof of housing, a criminal background check, and a medical examination consent form may be required before you may go to Iceland. Be ready to provide immigration extra paperwork, such as your passport and evidence of Icelandic health insurance. 

Amount To Immigrate To Iceland

Considering airfare and residency applications, there is a $116 fee for both the temporary and permanent resident licenses. Getting a Kennitala, Iceland’s national ID number, may cost roughly $62. It is mandatory if you plan to move there. 

Everything from establishing a bank account to searching for a job, getting medical treatment- even borrowing books from the library- you will need to show your Kennitala. 

Language And Culture

Northern Germanic Indo-European Icelandic is the official language in this country. 376,248 people are living in Iceland at the moment, and almost 98% of them speak English. Thus, 368,723 out of the 590,000 Icelanders can communicate in English. When compared to other European nations, this figure is astronomically high. 

Icelanders are, in fact, the happiest people in the world. For several years running, Iceland has been named one of the world’s happiest nations. 

With 80% of the population practicing Lutheranism, the Lutheran State Church is the largest Christian denomination in Iceland. According to Lutheran ideals,

God created a flawless world and sinless humans. 

Only 5% of Icelanders adhere to one Christian denomination; the remaining 5% follow either the Roman Catholic Church or Iceland’s Free Church. 

At last, an additional 5% of the population adheres to the old Norse religion (Ásatrú). The modern pagan movement known as Ásatrú seeks to bring back the old polytheism that worshiped deities like Thor, Odin, Freya, and others. 

Icelandic culture is forward-thinking and contemporary while yet honoring its old Viking heritage. Art, literature, and cuisine are the defining characteristics of Icelandic culture. Also, their musical style is unique, fusing a mix of both folk and pop. 

Magic and mystery, with its roots in Old Norse mythology, are deeply ingrained in Icelandic society. Surprising as it may seem, 7-8% of Icelanders believe that elves exist, and 45% believe that elves are still roaming. 

Entertainment 

Icelandic traditional performances often include artists engaged in weaving, woodcarving, or silversmithing. Art galleries, museums, opera houses, symphony orchestras, bookshops, and theaters abound in the nation’s capital. 

An adult ticket to a performance at Iceland’s National Theatre costs $4.22, a student or senior ticket is $7.64, and children under 16 get in free at the National Museum.

Region Best Known For Reasons to Move There
Reykjavik Cultural scene and nightlife Dynamic city life, rich cultural experiences, strong job market.
South Iceland Natural landscapes Outdoor adventures, waterfalls, volcanoes, glaciers.
Westman Islands Volcanic landscapes Close-knit community, rich in history and natural beauty.
West Iceland Historical sites and hot springs Icelandic history, wellness retreats in hot springs.
East Iceland Remote fjords and arts scene Peaceful living, vibrant creative communities.
Westfjords Landscape and wildlife Secluded living, wildlife watching, untouched nature.
North Iceland Aurora Borealis, geothermal activity Natural wonders, Northern Lights, diverse landscapes.
Highlands Wilderness, extreme landscapes Solitude, outdoor challenges, rugged interior.

These categories are mostly geographical rather than administrative since their primary purpose is to facilitate vacation planning in Iceland.

Frequently Asked Questions

Yes, Iceland has racism. There are racist actions that are more accurately characterized as acts of ignorance than of genuine bigotry. But, other racist concerns need to be addressed properly.

 

Last Words

Living in Iceland is a perfect blend of high prices, modern convenience, and tranquility. In terms of median wealth per adult, Iceland ranks third globally. 

Despite the high expenses of living, the level of life is just as high. Study shows that Icelanders are among the happiest people on the planet, a trend shared by other Scandinavian nations. Aside from its Scandinavian neighbors, Denmark, Norway, and Finland, it has been named the world’s fourth happiest nation.

Yes, Iceland has racism. There are racist actions that are more accurately characterized as acts of ignorance than of genuine bigotry. But, other racist concerns need to be addressed properly.

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