The Reasons Why Iceland Is So Expensive

iStock.com/Leopatrizi
iStock.com/Leopatrizi

More Americans are taking vacations to Iceland, and many are returning home with sticker shock. According to Iceland Magazine, “consumer prices in Iceland are on average 66 percent higher than in Europe,” with costs in the land of fire and ice outpacing famously expensive countries such as Switzerland, Norway, and Denmark.

Just look at the prices for food in Iceland’s capital of Reykjavík: A pre-made sandwich at a grocery store can cost more than $10, while a single teabag (with “free” hot water) can run you $4. A meal for two at a casual restaurant regularly costs in the ballpark of $80 to $100 while a beer at a pub downtown goes for about $12 during regular hours. In other words: Visiting Iceland is sort of like being trapped in an airport ... except this airport has volcanoes.

As for what makes the country so expensive, there’s no single explanation. It’s a combination of politics, economics, and geography.

Let’s start with geography. Since Iceland nearly tickles the Arctic Circle, its climate is not conducive to farming. There are few native crops and the growing season is short. According to a report from the European Consortium for Political Research [PDF], Icelanders produced “64.9 percent of their own food and beverages in 2010.” The rest of that food was imported. The same goes for most other goods.

The cost of importing those products—usually from the UK, Germany, the U.S., and Norway—gets passed on to the consumer. In Iceland, imported sweets and alcohol are slapped with an extra cargo fee and all wheat products are subject to a relatively high tariff. So prepare to shell out for that bread.

The country’s currency also keeps costs high. In 2008, Iceland was plagued by a financial crisis that saw the country’s three banks fail and the value of the national currency, the króna, plummet. But the country has seen a miraculous recovery. Since 2009, the króna has strengthened by a whopping 40 percent against the euro. In 2017, it was deemed the world's best-performing currency. That has caused the purchasing power of the U.S. dollar to decrease.

Taxes also add to the cost. Like most countries, Iceland has a valued-added tax, or VAT. (In the United States, a close equivalent would be the state sales tax.) The VAT for goods in Iceland is 24 percent, while the VAT for foodstuffs is taxed at a discounted rate of 11 percent. For Americans, these tax rates are very high. Most states don’t even charge a sales tax on food at all.

(However, while taxes are a contributor, they are not the cause of high costs in Iceland. Many countries have similarly high VAT rates and are not as expensive. Germany, for example, has a 19 percent VAT—and a 7 percent VAT on foodstuffs—but is home to significantly cheaper groceries than those sold in the United States. It’s also important to know that, as an international visitor, you can get some of your VAT refunded.)

Rather, the biggest contributor to costs in Iceland is the country’s high standard of living. In Iceland, the average pre-tax income is about $60,000, with a median income of about $47,000. (In the U.S., the average income is about $48,150 with a median of around $31,000.)

In Iceland, approximately 92 percent of the country’s working population is part of a labor union. Consequently, people who work jobs that Americans might consider “low-wage”—especially jobs in the service industry—earn much higher wages and enjoy more benefits. In fact, the national monthly minimum wage for most industries is 300,000 ISK, or about $2500 per month. That’s equivalent to $15 an hour. But since employees earn more, customers generally pay more for goods.

And, of course, any tourist complaining about high prices should take a moment to point a finger at the mirror. Since 2010, Iceland has seen tourism multiply fivefold. With a growing number of people competing for a limited supply of goods, prices have continued to rise; the dastardly supply and demand curve strikes again!

Hundreds of Kangaroos Roam the Green at This Australian Golf Course

burroblando/iStock via Getty Images
burroblando/iStock via Getty Images

Anglesea Golf Club has all the makings of a regular golf club: an 18-hole golf course, a mini golf course, a driving range, a clubhouse, and a bistro. But the kangaroo mobs that hop around the holes add an element of surprise to your otherwise leisurely round of one of the slowest games in sports.

Person takes photo of a kangaroo
Anglesea Golf Club

According to Thrillist, the kangaroos have been a mainstay for years, and the club started giving tours a few years ago to ensure visitors could observe them in the safest way possible. For about 25 minutes, a volunteer tour guide will drive a golf cart with up to 14 passengers around the course, sharing fun facts about kangaroos and stopping at opportune locations for people to snap a few photos of the marsupials, which are most active in late afternoon and early morning. Kangaroos are friendly creatures, but Anglesea’s website reminds visitors that “they can also be quite aggressive if they feel threatened.”

Post-graduate students and academic staff from Melbourne University’s zoology department have been researching Anglesea’s kangaroo population since 2004, and some of the animals are marked with collar and ear tags so the researchers can track movement, growth, survival, and reproduction patterns throughout their life cycle.

One of the reasons kangaroos have continued to dwell on land so highly trafficked by people is because of the quality of the land itself, National Geographic reports. The golf course staff regularly sprinkles nitrogen fertilizer all over the green, which makes the grass especially healthy.

Kangaroos graze on Anglesea Golf Course
Anglesea Golf Club

If you decide to plan a trip to Anglesea Golf Club, you can book a kangaroo tour here—adult tickets are $8.50, and children under 12 can come along for just $3.50 each.

[h/t Thrillist]

House Boasting a ‘Harry Potter Room’ Under the Stairs Hits the Market in San Diego

Cupboard under the stairs featured on the Warner Bros. Studio Tour: The Making of Harry Potter in London.
Cupboard under the stairs featured on the Warner Bros. Studio Tour: The Making of Harry Potter in London.
Matt Robinson, Flickr // CC BY 2.0

When Harry Potter fans dream of living like the boy wizard, they may picture Harry's cozy quarters in the Gryffindor dormitory at Hogwarts. One home owner in San Diego, California is trying to spin one of Harry's much less idyllic living situations as a magical feature. As The San Diego Union-Tribune reports, a listing of a three-bedroom house for sale in the city's Logan Heights neighborhood boasts a "Harry Potter room"—a.k.a storage room under the stairs.

In the Harry Potter books, the cupboard under the stairs of the Dursley residence served as Harry's bedroom before he enrolled in Hogwarts. Harry was eager to escape the cramped, dusty space, but thanks to the series' massive success, a similar feature in a real-world home may be a selling point for Harry Potter fans.

Kristin Rye, the seller of the San Diego house, told The Union-Tribune she would read Harry Potter books to her son, though she wouldn't describe herself as a super fan. As for why she characterized her closet as a “large ‘Harry Potter’ storage room underneath stairs" in her real estate listing, she said it was the most accurate description she could think of. “It’s just this closet under the stairs that goes back and is pretty much like a Harry Potter room. I don’t know how else to describe it," she told the newspaper.

Beyond the cupboard under the stairs, Rye's listing doesn't bear much resemblance to the cookie-cutter, suburban home of 4 Privet Drive. Nearly a century old, the San Diego house has the same cobwebs and a musty smells you might expect from the Hogwarts dungeons, the newspaper reports. But there are some perks, including a parking spot and backyard space for a garden or pull-up bar. The 1322-square-foot home is listed at $425,000—cheaper than the median price of $620,000 for a resale single-family home in the area.

If you want to live like a wizard, you don't necessarily need to start by moving under a staircase. In North Yorkshire, England, a cottage modeled after Hagrid's Hut is available to rent on a nightly basis.

[h/t The San Diego Union-Tribune]

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