FAQ about special housing aid

Any residential real estate leaseholder may apply for special housing aid. Other residents are considered members of the household for the purposes of this application. If there is more than one party to a residential rental agreement, members of the household are expected to agree on which one should be the applicant for special housing aid.

Please note that housing benefits must first be claimed from the Housing and Construction Authority.

To be eligible for housing benefits, several conditions must be met. Find out more on the website of the Housing and Construction Authority.

An application for special housing aid may be accepted even if there is no lease agreement at the time if it is shown that the applicant is actively searching for housing. The period of validity of the application is three months from the date of acceptance, however, the payment of the special housing aid does not begin until the right to housing benefits has been confirmed.

Yes, it matters.

In the case of an individual, payments are not impaired if the income is below 5,690,772 kr. per year or 474,231 per month. Once income exceeds 7,113,465 kr. per year or 592,789 kr. per month, the entitlement to special housing aid will cease.

In the case of two residents, payments are not impaired if the combined income is below 7,568,727 kr. per year or 630,727 kr. per month. Once income exceeds 9,460,909 kr. per year or 788,409 kr. per month, the entitlement to special housing aid will cease.

In the case of three residents, payments are not impaired if the combined income is below 8,820,697 kr. per year or 735,058 kr. per month. Once income exceeds 11,025,871 kr. per year or 918,823 kr. per month, the entitlement to special housing aid will cease.

In the case of four residents, payments are not impaired if the combined income is below 9,560,497 kr. per year or 796,709 kr. per month. Once income exceeds 11,950,621 kr. per year or 995,885 kr. per month, the entitlement to special housing aid will cease.

In the case of five residents, payments are not impaired if the combined income is below 10,357,206 kr. per year or 863,101 kr. per month. Once income exceeds 12,946,508 kr. per year or 1,078,876 kr. per month, the entitlement to special housing aid will cease.

In the case of six or more residents, payments are not impaired if the combined income is below 11,153,914 kr. per year or 929,493 kr. per month. Once income exceeds 13,942,393 kr. per year or 1,161,866 kr. per month, the entitlement to special housing aid will cease.
 

Yes. The combined assets of the applicant and other household members aged 18 and over in the previous year cannot exceed 7,745,000 kr. These are net assets, i.e., all assets less liabilities.

Assets include bank account balances, cars, trailers, motorcycles, real estate, and stock, according to the tax return.

Liabilities are all debts at the end of the year according to the tax return.

Yes, people who pay 50,000 kr. or less in rent per month cannot receive special housing aid.

Yes. The residential housing must meet minimum requirements, namely one bedroom plus a private kitchen or a private kitchenette, and a private washroom. Housing benefits cannot be claimed for commercial property as listed by the Register of Properties.

Students who rent a room or apartment in a dormitory or student housing connected with an accredited educational institution within the public education system are exempt from this rule and may receive housing benefits for renting a room.

This also applies to cohabiting disabled individuals in housing accommodations and individuals living in halfway houses.

It depends on the situation, income and assets of all household members over 18 years of age.

The special housing aid is calculated as a certain percentage of the housing benefits so that for every 1,000 kr. the tenant will be paid 1,000 kr. of special housing aid, considering the reduction in the Reykjavík City Rules on Special Housing Aid and taking into account the impact of income.

Housing benefits and special housing aid can never exceed a total amount of 100,000 kr. The amount of the special housing subsidy considers the income of all household members over 18 years of age.

Special housing aid payments stop at the end of the last month you qualify for special housing aid according to the Reykjavík City Policy on Special Housing Aid or when the rental agreement ceases.

Housing benefits are settled annually for the previous year by the agency responsible for them. Special housing aid is then recalculated based on changes shown in the housing benefits settlement. Applications for special housing aid automatically expire if recalculation shows the applicant's income exceeded the allowed limit for the entire previous year and all months up to the recalculation.

Special housing aid is paid to applicants in the first week of each calendar month. If the rental period does not start on the first calendar day, or end on the last calendar day, the special housing aid is paid proportionally for the previous month, otherwise it is paid in full for the previous month. Agreements to prepay the housing cost between the applicant and the landlord or third parties has no effect on when the special housing aid is paid.

Special housing aid is paid into the account specified by the applicant in the application. Special housing aid may be paid to the landlord at the written request of the applicant.

No. Special housing aid is exempt from tax.

Special housing aid is paid no further back than from the calendar month in which the application is received. It is prohibited to pay special housing aid further back, even though payments for rent started earlier as shown in a rental agreement.

Special housing aid should be provided to parents or guardians of 15-17 year old children who rent rooms in dormitories or student housing in Iceland for studying away from home. The special housing aid shall be independent of the parents’ or guardian’s income and assets and shall amount to 60% of the rental amount. You must submit a housing lease and confirmation of the child's studies with the aid application.

If your application is denied, and you believe there are exceptional circumstances, you can request a review by the Welfare Council Appeal Board.