Garðabær's strong performance and debt ratios are decreasing

The operation of Garðabær 2025 was successful and the results reflect the strong position of the municipality. This is shown in Garðabær's new annual accounts for 2025, which were presented at the municipal council meeting on April 14, 2026. Along with investments, growth and continued development, Garðabær stands on a strong foundation and debt ratios are decreasing.

Garðabær's overall operating result in 2025 was positive by 2,753 million ISK, compared to 1,183 million ISK in 2024. Operating income amounted to 35,239 million ISK, which is 9.1% higher than planned. Operating expenses amounted to 28,570 million ISK. Capital expenses decreased between years and amounted to 1,905 million ISK, compared to 2,180 million ISK in 2024. Depreciation and amortization amounted to 2,011 million ISK and working capital from operations amounted to 2,389 million ISK.

Responsible financial management benefits the population

Borrowing in 2025 amounted to 3,159 million ISK and was 866 million ISK lower than expected. Garðabær repaid long-term loans and lease liabilities in the amount of 2,094 million ISK and short-term loans decreased by 919 million ISK. Net borrowing was therefore insignificant during the year. The debt-to-income ratio decreased significantly between years and is now 86%, but was 97% in 2024. The debt-to-income ratio also decreased from 120% in 2024 to 110% in 2025.

"It has been a central theme in our decision-making that it is important to have money to spend. We have placed great emphasis on limiting debt growth, paying down loans and systematically reducing the town's debt ratio," says Almar Guðmundsson, mayor of Garðabær. "Lower debt and a strong financial position are prerequisites for continued development and improved services," he adds.

The levy on residents has been moderated in accordance with the operation of Garðabær, and the local government tax rate is among the lowest known among municipalities in Iceland. The levy rate on property taxes has been reduced and general rate increases have not exceeded the price level.

"We want the residents to feel it themselves when things are going well," says Almar.

Ongoing development

The population of Gardabaer increased by 608 during the year, and the population at the end of the year was 20,724. This shows that the population increase continues to be stable, but in the last four years 2,677 residents have moved to Gardabaer.

Investments amounted to 5,089 million ISK, and the most notable projects include the construction of the 3rd phase of Urriðaholtsskóli with a sports hall and swimming pool, new facilities on the 2nd floor of Miðgarður, renovations to school buildings and school grounds, a new community center for the elderly in Álftanes, construction of sewage systems in Álftanes, as well as a number of other smaller projects. Contributions to education and upbringing as a percentage of tax revenue increased significantly, from 56.3% to 61.3% between years.

"It is pleasing to see that the population of Garðabær continues to grow and that the community is young compared to many others. It is confirmation that we are on the right track. At the same time, it is very important that investments are in line with that development and that income from the sale of building rights is used to develop infrastructure. Of course, we work on the basis that service and development remain at the forefront," says Almar.

Main key figures

· Debt ratio: 86%

· Debt ratio: 110%

· Working capital from operations: ISK 2.389 million or 6.8% of operating income

· Operating result: ISK 2,753 million or 7.8% of operating income

· Investments: ISK 5,089 million or 14.4% of operating income

· Equity ratio: 45.8%

The annual accounts will now be presented to bæjarstjórn Garðabæjar for two discussions.

It can be accessed below.