From Farm to City
The settlement of Iceland began in the 9th century, by Norwegian and Celtic immigrants. According to the medieval Book of Settlements, the first permanent settler was Ingólfur Arnarson, a Norwegian Viking who built his farm on the peninsula where Reykjavik stands today. The peninsula was named Reykjavík (Smoky Bay) because of the columns of steam that rose from the hot springs in the area, which made such a profound impression on the original settlers.
Ingólfur Arnarson, his wife Hallveig Fródadóttir and their son Þorseinn Ingólfsson built a farmstead in Aðalstræti (Main Street) in Reykjavík around AD 870, the same street where the Tourist Information Centre is now located. Archaeological excavations in Adalstraeti and Sudurgata confirm this approximate date.
Legend claims that Ingólfur decision to settle in Reykjavík was placed in the hands of the gods. He flung high-set pillar into the sea and swore to settle where the pillars, carved in the likeness of the Norse gods, washed ashore. However, it is more likely that the Reykjavík peninsula was chosen by Ingólfur because of its natural advantages such as mild climate, good moorage, extensive lowland, shores where driftwood accumulated, marshes providing bog iron and peat for fuel, hot springs, excellent fishing grounds, plentiful resources of seabird eggs and seal hunting, good grazing land, cultivable offshore islands, and salmon rivers. The settler relied heavily upon fishing so Ingólfur chose well where to fling his pillars.
Ingólfur’s estate was extensive, in addition to the home in Reykjavík his estate reached from Brynjudalsá in Hvalfjördur to Ölfusá in Árnessýsla. By laying claim to such a vast amount of land, Ingólfur appears to have planned to have the power to decide who would settle in his sphere of influence in the southwest of Iceland. After Ingólfur's time, the extent of the Reykjavík estate was gradually reduced. At Seltjarnarnes, large estates arose, which competed in size with Reykjavík itself, perhaps due to division of the property among Ingólfur's descendants. Examples of this are Laugarnes and Nes at Seltjörn.
The descendants of Ingólfur and Hallveig in the male line were known by the title Allsherjargoði (religious and secular leader), in deference to their status as descendants of the first settler. They initiated the foundation of the Kjalarnes Assembly, and played an important role in the foundation of the Alþingi (parliament) at Þingvellir in 930. Þorkell máni, grandson of Ingólfur and Hallveig, was Lawspeaker (highest official of the Alþingi). His son, Thormódur, was Allsherjargodi at the time of Iceland's adoption of Christianity in AD 1000.
After 1000 AD, the estate of Reykjavík is rarely mentioned in sources, and Ingólfur's family vanishes from the pages of history. Woollen products became Iceland's principal export commodity, and so Reykjavík, an estate whose main resource was fish, was less prized than in the age of settlement.
Source: Reykjavík City Museum