Tenants pay a 110 thousand krónur tax to the capital at the end of each month.

„It should be the policy of Reykjavík City to break down the grip of capital on the housing market. The public has a right to housing without paying large sums to the country's few wealthiest families at the end of each month,“ says Sanna Magdalena Mörtudóttir, leader of the socialists in Reykjavík.

The Socialist Party proposes that Reykjavík and other municipalities establish housing associations to isolate as large a part of the housing market as possible from profit-driven companies that have taken over the housing market. „As the system is today, capital simply takes too much. People who need housing have to support profits for owners of import companies, for contractors and land speculators, and for owners of rental companies. This is simply too much. The housing system is not for the many who want safe and affordable housing, but for the few and wealthy who view the public's need for housing as an opportunity to create excessive profits. It's time for people to stand up and say: No thank you, no more,“ says Sanna Magdalena.

According to Statistics Iceland, the construction cost per square meter for a so-called index apartment is under 215 thousand krónur per square meter. This means that an 85 square meter apartment would cost about 18.3 million krónur without land costs. Installments on an 18.3 million krónur loan at the lending rates of Lífeyrissjóður verslunarmanna for 40 years are just under 79 thousand krónur per month. Rent for such an apartment should therefore not exceed 100 thousand krónur per month, taking into account maintenance and administration. A family with two earners on minimum wage would pay just under 62 thousand krónur in housing costs after housing benefits.

But what does it cost to rent such an apartment from Heimavellir or other comparable rental companies? There is one 85 square meter apartment for rent at Heimavellir in Reykjavík today. It costs 210 thousand krónur per month. The housing cost for the family mentioned above would then be just under 172 thousand krónur. People who rent this apartment therefore pay the owners of Heimavellir about 110 thousand krónur per month in excess of construction costs and administration. The difference amounts to 1.3 million krónur per year.

It can be estimated that there are about eight thousand rental apartments on the general market in Reykjavík. Based on the example above, it can be estimated that tenants in Reykjavík pay the capital close to 10 billion krónur annually in rent in excess of what it costs to build and maintain the housing. These funds go to land speculators, import companies, contractors, rental companies, and others who have latched onto people's need for housing.

„These are the burdens on the city's residents from capital, and just on the housing market,“ says Sanna Magdalena. „It must be the main goal of city authorities to protect residents from the aggression of profit-driven companies. It is certainly necessary to lower taxes on the lowest wages, but it is no less important to lower the public's costs from capital. Taxes, however, go to common funds and good causes, but the payment to capital goes directly into the pockets of a few.“