Úlfur: A child during the Crash
The dream of the house
"Grandad, why can't you just print money? This was shortly after the financial crash and Icelandic families were short of money. I thought this was an easy solution.” Úlfur was just eight years old talking about the economic collapse with his grandfather in 2008. The financial collapse affected thousands of Icelanders and ten thousand families lost their homes. Úlfur's grandfather didn’t recommend printing money and justified his case with "some economic theory" that had little in common with Úlfur's clear albeit childish sense of the world.
The 2008 Crash had dire consequences for Úlfur's family, starting a struggle against poverty and insecurity, a struggle that continues to this day, despite a temporary ceasefire that was established when his parents declared bankruptcy. "Just over two years ago, they were forced to go bankrupt, and as a result, the situation began to improve."
The Crash and its impact on Úlfur’s parents is a story of a young couple who bought one of the oldest houses in Hafnarfjörður. They got the house rather cheap as it was in a sorry state and had to be rebuilt almost from scratch. The young couple, who had been accustomed to working hard since they were children, had come up with a future project for themselves and their two children in the town where their extended family lives.
"My parents were very young when they had me, without a high school education, young workers who relied on their own diligence. All electric wiring and plumbing were replaced, the insulation and fittings renewed.” Úlfur has a fond memory of a fireplace that was used for a time to heat the house.
At the time of the Crash, they were stuck in an impossible place regarding refinancing their project. They needed the house to be sufficiently valued to get refinancing and finish the job. The debt multiplied and they lost the property; the beautiful dream turned into a twelve-year nightmare.
"I experienced a lot of injustice." Úlfur was a precocious child and sensed how ordinary people suffered because of the Crash, while the actual perpetrators, the big fish, often escaped. His parents lost their home when he was eight years old and suddenly their lives were governed by the default register and a landlord that couldn’t be avoided. "Then begins a terrible period in their lives."
Úlfur considers the rental market a poverty trap. His parents pay 320 thousand a month for a three-room apartment, which means they are unable to put aside any money. "My mother had a terrible car accident in 2004 and has been unable to work. The illness is not related to the Crash, but as a result their financial situation weakened significantly. Mom only had her disability benefits, so Dad just had to run faster. He was sometimes in two if not three jobs. He is a sign painter and drives a taxi and in addition he took on paint work spraying cars and car parts. It is still a mystery to me how he managed to survive the worst years.
"The collapse shaped me a lot. I never saw their bank balance and never knew the exact situation, but I fully realized that my parents were losing their house and we were in a kind of limbo and in a stroke of a brush, their finances collapsed. During this time, I stopped trusting authority and people in power. I haven’t changed my mind.
"But there were things I couldn’t put on my family, such as school meals, trips, the extra costs that come with children and someone having to pay them. The school meals were by subscription, and they would probably have given me the money had I asked for it, but I didn’t, I was aware of the situation.” Any extra expenses for the family simply meant worse food for a week or the younger sister wouldn’t get something she needed, someone or something would have to be sacrificed because of his needs. "I didn’t feel ashamed, but I did experience outrageous injustice. My friends all had nicer things and we never could afford a family holiday.” Úlfur says that fortunately the family ties are strong. "Our grandparents always bought shoes and schoolbags for us kids.
“Financial worries have always been with me." Úlfur was only 13 when he started working for Skema. He knew that he needed to work hard and put in a lot of effort to achieve academic success and accept nothing less than the best results. He skipped grades in elementary school, finished high school in three years and at the age of 18 enrolled in college. After a year and a half in computer science at Reykjavík University, he hit a wall. "I simply overworked myself and had to go on leave to unwind. I had always worked while studying and it was just too much. My foreign friends and colleagues find it incomprehensible that I started in this business when I was only 13.
Students in the rental market
"The studies won’t go away and await a better time. When I experienced my burnout, I was working 30 percent part time as well as conducting my studies. After a three month leave, I concluded that studying and working didn’t go well together. I lived in my parents' house when I was studying, which I can’t do any longer after my parents had their third child. My sister is two years old, and she needs her own room.” There simply is no room for Úlfur in his parents' house anymore. "Today I rent with my friends at Vellir in Hafnarfjörður. There are three of us and I work full-time as a project manager at Skema."
The only way to be a student in the rental market and live a decent life is shared renting. "There are three of us, my friends are both studying while I work," says Úlfur. “We have agreed that I work and pay proportionally more of the household expenses while they are students, but when they finish their studies and enter the job market, I will be able to work less and concentrate on my studies. I work full time at Skema and have worked my way up to project manager and as I love working a lot, I always find some extra projects and teaching, so my position is pretty good today. None of us wants to take out a student loan and get into debt, and this arrangement works very well for us.
“The consequences of the Crash and how it affected my family have made me a fighter. I am very proud of my people, low-wage workers who have endured adversity and survived the violence of the Crash. We have been strengthened by this experience and compassion has shaped us. I take part in all kinds of work and fight for social justice. I don’t want anyone to experience poverty like I did as a child. Twice a month I meet with Grandad and Great Grandad at the Lions Club. I am by far the youngest of the lions, 24 years old and the next person in age is over seventy. But I love the camaraderie and committee work that revolves around the needs of the community, raising money, buying furniture for the homes of the disabled, exercise equipment for the nursing home, aiding the Maternity Support Committee before Christmas. Of course, this support is something a normal society should provide, but in our case it doesn’t. Giving is so good."
The Crash in numbers
In the first ten years after the epic financial Crash in Iceland, unsuccessful foreclosures were carried out against 117 thousand individuals. About 3,000 were declared bankrupt and 8,800 individual properties were sold at forced auction to which should be added about 400 properties that were sold on forced sale or sale due to debtors' debt relief.
In addition, 349 debtors' properties had been sold to creditors in connection with the payment adjustment.
Therefore, a total of 9,195 cases of forced sale or sales due to payment adjustment over a ten-year period I.e. about 920 per year on average according to an audit requested by the Parliament (Althingi), meaning the total number was well over 10,000 at the beginning of 2018.
The total figures for individuals in the years 2008-2017 are as follows:
Compulsory sales: 8,846
Unsuccessful foreclosure: 116,939