Property assessment

All properties in Iceland are registered and evaluated for property assessment and fire compensation assessment by Icelandic Property Registry.

The property assessment is an assessment of the value of a building and the site on which it stands, and is based on the market price of similar properties on the market.
Property assessments are updated anually, in accordance with developments in property prices. Property owners are always sent notification of any changes.
The calculation of the following public levies is based on the property assessment:

property taxes

inheritance tax and

stamp tax for the registration of purchase agreements.

Fire compensation assessment

Applications for a fire-compensation assessment must be submitted within four weeks of new accommodation being taken into use. The first assessment is free of charge.
Fire-compensation assessment is the insurance amount of a property or the estimated cost of rebuilding a property that is destroyed by fire.
Fire insurance premiums are based on the fire-compensation assessment.
The fire-compensation assessment is the fee base of the following fees:

avalanche protection fund fee

catastrophe insurance fee and

fire-compensation assessment fee

If a property owner believes that the value of a property has increased due to improvements, he or she is under obligation to request a reassessment.
If a property owner objects to the currently valid property assessment, he or she may demand a ruling by Registers Iceland.
A rise in the fire-compensation assessment can lead to a higher property assessment, which again means higher public levies and premiums.
Lending institutions generally use fire-compensation or property assessment to determine the mortgage percentage of a property, i.e. how large a loan they will grant on the property.