First-time buyers increase home purchases as overall sales fall

First-time homebuyers signed more purchase contracts in 2025 even as the total number of property sales fell, mbl.is reported. Their share of contracts rose from 29 per cent in 2024 to 34 per cent last year.

First-time buyers signed 3,921 contracts in 2025, up 114, or 3 per cent, from 3,807 the previous year. Overall, property purchase contracts fell from 13,179 to 11,657, a decline of nearly 12 per cent.

Most first-time purchases were recorded in 2021

The figures were included in a response by Social Affairs and Housing Minister Ragnar Þór Ingólfsson to a question from Sigurður Ingi Jóhannsson, chairman of the Progressive Party. The response was published on the Icelandic parliament’s website.

Between 2007 and 2025, first-time buyers accounted for the largest share of contracts in 2020 and 2021, at 37 per cent in both years. The highest number of contracts was recorded in 2021, at 5,185. The lowest was in 2009, when buyers signed 783 contracts and made up 26 per cent of the total.

Sigurður Ingi requested figures dating back to 2000, but the response said reliable annual data on first-time buyers was not available for 2000 to 2006. The figures are based on property transaction records and a first-time buyer dashboard maintained by the Housing, Construction and Planning Authority.

Government support measures

Asked about measures to support first-time buyers, the minister identified shared-equity loans as the main initiative introduced by his ministry or its predecessors. Established by law in 2020, the loans allow eligible first-time buyers below specified income and asset limits to borrow from the state without interest or repayments for up to 20 to 30 per cent of a home’s purchase price.

The response also cited a 50 per cent stamp duty discount for first-time buyers introduced in 2014, and legislation passed in 2017 allowing them to use private pension savings toward a down payment or to reduce the principal on their home loan for 10 years.

Other measures included housing benefits, temporary interest-rate support in 2024 and changes to lending rules at the Housing Financing Fund. The response noted that not all of these measures were specifically aimed at first-time buyers, though they could benefit them as well as other property owners.