Game Of Thrones Boosts Iceland House Prices

The Game of Thrones effect seems to be melting the hearts of visitors to Iceland – and stoking up house prices.

The North Atlantic island is the backdrop for the frozen land beyond the wall manned by the Night Watch in the hit TV series.

Tour firms run regular trips to the isolated and wild lakes and mountains.

More than 1.7 million visitors were recorded in Iceland last year, and the demand for accommodation is heating up the property markets.

With a population of 344,000 and 130,000 homes, Iceland has a squeeze on supply and demand that has forced the government to step in to cool prices that have surged by 23% in a year, according to international real estate consultancy Knight Frank.

License to rent

The firm’s latest global snapshot of residential property markets shows Iceland has the highest house price inflation in the world.

A four-bedroom villa set in spectacular mountainous countryside costs around £629,000. Three months ago, the price was £591,000 – an increase of 6.5%.

But the government wants to slow the market by licensing locals who want to let out their homes to tourists for more than 90 days a year or who generate a rental income of more than $9,500 a year.

House prices are also rising fast in Hong Kong, says Knight Frank, where the annual price change is 21.1%.

Elsewhere, out of the 55 markets monitored by the firm, only nine more have double-digit annual increases.

India is hottest global market

Six show price drops with Ukraine sitting at the bottom with a fall of 6% in the past 12 months.

“Hong Kong’s stellar performance is perhaps counterintuitive given three rate rises in the last year but strong demand and limited supply are behind its strengthening prices,” said Kate Everett-Allen, a researcher at Knight Frank.

She explained Hong Kong is the best performing Asian housing market over the past year, but the trend over five years highlights India as a star with a 70% return, ahead of Hong Kong’s 65% posting during the same period.

Overall, global house prices increased by an average 5.6% in the year to the end of June.

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