Columnist rejects EU membership as housing solution

In a column published by Morgunblaðið, Sólveig Anna Jónsdóttir argues that joining the European Union would not quickly solve Iceland’s housing crisis, despite claims from EU supporters that membership would bring lower interest rates and inflation.

She cites a new report by the think tank Social Europe, titled “The Generation Locked Out”, which describes the serious housing problems facing young people across Europe. House prices have risen sharply, while young people on average incomes in many European cities must spend 60-70% of their earnings on rent. In several EU member states, the cost of buying a first home has multiplied in recent years.

The consequences include young people living longer with their parents, being unable to start families, facing financial pressure and experiencing reduced social mobility. The growth of short-term rentals is also undermining people’s security and ability to shape their own futures, she writes.

Jónsdóttir says housing for ordinary people is increasingly being treated as an investment for the wealthy rather than as a foundation of a civilised society. She adds that many of the problems described in the report are also present in Iceland, where young people and workers struggle to buy homes and renters must spend a large share of their disposable income on housing.

However, she argues that Iceland’s position is better in several respects than that of many European countries. Icelandic workers have stronger bargaining power in the labour market than workers in most of continental Europe, she writes. While wages cannot solve a shortage of housing or a poor rental market, they are crucial in helping people meet the costs.

Jónsdóttir also says Iceland’s small population and wealthy society make it possible to create political pressure for rapid and effective reforms. She says housing supply can be increased, tenants protected and social measures strengthened, while housing should not be left entirely to market forces because it is essential for a decent life.

“We should not allow ourselves to be convinced that the solution to the housing problem is to transfer more power beyond the country’s borders,” Jónsdóttir writes. Instead, she calls for people to support one another and ensure access to genuine housing security rather than relying on a system that, in her view, has failed a huge number of young people across Europe.