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Icelandic Real Estate & Proptech Scene

Geographical Influences on Icelandic Real Estate

I spent 8 days in Iceland and honestly, there weren’t a lot of buildings to be seen or much of a proptech community. Iceland is aptly nicknamed the land of ice and fire due to its abundance of seismic activity, volcanoes, and icebergs. While breathtaking, it’s one of the hostile environments to build in.

As such, all of Icelandic real estate, from turf houses to award winning landmarks, exhibit an underlying level of respect, or perhaps subservience, to nature that I haven’t seen in any other country. So powerful are the forces of nature here that architects and engineers must prioritize what nature allows over what humans desire.

Icelandic Culture and Behavior

Unsurprisingly, public behavior is heavily influenced by the weather and geography. The first settlers arrived just over a millennium ago in 974, so their history isn’t as long as other cultures. Much of it was riddled with conflict, which, coupled with the environment, made them hardy and resilient people.

Only in the last century has the economy truly begun to develop. Their primary industry monetizes their greatest resource- tourism. I’m not sure if I was even exposed to true local behavior, or just the face that they put on for tourists, but everyone was very friendly and laid back.

Fishing and aluminum smelting industries are a distant second and third to tourism. Most of the population of 370,000 are involved in these industries.

How Culture affects Icelandic Real Estate

The prevailing traits of the people- adaptability, resiliency, and endurance- translates directly to the Icelandic real estate scene.

Up through the first half of the twentieth century, turf houses were the primary architectural form. They were constructed of stone, with a thick layer of turf on the roof for insulation, and doors and wood details made of birch. Iceland doesn’t produce its own structural lumber, and its birch forests have been wiped out by lava fields on several occasions. So there weren’t a lot of options for building materials.

Asi Iceland’s GDP rapidly increased mid-century, buildings switched over to concrete. Imported lumber costs a lot more than concrete. And given the geological activity, it’s necessary for earthquake-proofing. Most single family homes are thick concrete structures.

Corrugated iron typically hides the concrete. While it’s generally viewed as a cheap cladding material in most countries, it’s both roofing and siding in Iceland. Because buildings need to withstand nonstop wind, snow, sleet, hail, rain, and salt. To make it a bit more fun, the facades are often painted in bright colors.

The theme of adaptation to nature extends to Iceland’s greatest landmark buildings. Hallgr√≠mskirkja and Harpa, for example, contain heavy references to natural land formations, like basalt columns, waterfalls, glaciers, and volcanoes. Architects didn’t design for their ego- they paid respects to nature.

But the most awe-inspiring structures here are not designed by humans at all- rather by nature itself over millions of years. We’re all just tourists in the land of ice and fire.

Iceland’s Proptech Scene

Earlier, I noted there’s not much of a proptech community. My directory has a grand total of one proptech company headquartered in Iceland. But once again, the Icelandic people have adapted to and harnessed its natural features for sustainability. Iceland leads the world in renewable energy per capita, generating 55,000 kWh annually per person. There’s an abundance of hot springs and waterfalls to generate heat and hydroelectric power, so the first geothermal heating system in Europe was built in Iceland in 1907. 90% of households use geothermal energy for heat and hot water. 100% of the country’s electric is renewable.

Lessons to Learn from Iceland

There’s a few major lessons that both real estate professionals and proptech founders can learn from Icelandic real estate. As I’ve been reiterating throughout this cultural series, local conditions have a tremendous affect on whether proptech solutions can be deployed there. What works in your country doesn’t necessarily work in others. However, the conditions evolved a sense of resourcefulness that made the Icelandic people global leaders in sustainability. They are an excellent case study in leveraging your strengths. If you’re a founder, let me help you leverage your strengths to become a best-in-class proptech company.


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