Það er of mikill raki inni, svo við setjum þvottagrindina nær glugganum.

Það er is a very common Icelandic way to say there is / there are or to introduce a situation.

So:

• Það er raki inni = There is dampness/humidity inside
• Það er of mikill raki inni = There is too much humidity inside

Here það does not literally mean a specific it. It works more like the English there in there is.

of means too in the sense of more than is good or desirable.

So:

• of mikill raki = too much humidity
• of kalt = too cold
• of heitt = too hot

Be careful: this of is not the same as English of.

Because mikill has to agree with the noun raki.

• raki is masculine singular
• so the adjective must also be masculine singular
• therefore: mikill raki

Compare:

• mikill raki = much humidity/dampness (masculine)
• mikið vatn = much water (neuter)
• mikil rigning = much rain (feminine)

So of mikill raki means too much humidity, with normal adjective agreement.

Raki means moisture, dampness, or humidity, depending on context.

In this sentence, it most naturally means humidity/dampness in the air indoors.

So the idea is:

• the air inside is too damp
• therefore they move the drying rack closer to the window

Inni means inside / indoors.

So:

• Það er of mikill raki inni = There is too much humidity inside

It comes at the end of the clause because Icelandic often places adverbs of location there quite naturally.

Compare:

• Ég er inni = I am inside
• Krakkarnir eru úti = The kids are outside

Here svo means so, therefore, or as a result.

It links the two parts of the sentence:

• There is too much humidity inside
• so we move/put the drying rack closer to the window

In other contexts, svo can also mean then, so, or be part of other expressions, but here it clearly shows consequence.

Setjum is the 1st person plural present tense of setja = to set, put, place.

So:

• ég set = I put
• þú setur = you put
• við setjum = we put

In this sentence:

• við setjum þvottagrindina nær glugganum
• we put / move the drying rack closer to the window

Using setja here is very natural for physically placing or repositioning something.

Þvottagrindina is the definite accusative singular form of þvottagrind.

Base form:

• þvottagrind = drying rack / clothes drying rack

In the sentence, it is the direct object of setjum, so it appears in the accusative:

• nominative: þvottagrindin = the drying rack
• accusative: þvottagrindina = the drying rack

So Icelandic is marking:

1. that it is definite (the drying rack)
2. that it is the object of the verb

Nær means nearer / closer.

So:

• nær glugganum = closer to the window

It expresses movement to a position that is more near the window than before.

You can think of it as a comparative idea:

• nálægt = near
• nær = nearer / closer

In this sentence, they are not just putting the rack by the window; they are moving it closer to it.

Because nær takes the dative case here.

The noun is gluggi = window.

Its definite singular forms include:

• nominative: glugginn = the window
• accusative: gluggann
• dative: glugganum

Since the sentence has nær glugganum, Icelandic uses the dative after nær.

So:

• nær glugganum = closer to the window

This is a very useful thing to remember: some Icelandic words require specific cases, and nær is one of the ones commonly used with the dative.

In this sentence, closer to the window is better.

That is because nær usually has a comparative sense: nearer / closer.

So the full meaning is:

• there is too much humidity inside
• so we move the drying rack closer to the window

If the idea were just by the window or near the window, Icelandic might use a different structure.

Because svo here is functioning like so in English and introduces a new main clause:

• svo við setjum þvottagrindina nær glugganum

In Icelandic, main clauses usually keep the finite verb in second position, but if a connector like svo is used in this way, the next clause can begin normally with the subject:

• við = subject
• setjum = verb

So this word order is perfectly natural.

Yes, definitely.

A very natural English translation here would be:

• so we move the drying rack closer to the window

Even though setja literally means set / put / place, English often prefers move when something is being repositioned.

So both ideas are present:

• literal Icelandic sense: put/place
• natural English sense in context: move

It has two main parts joined by svo:

1. Það er of mikill raki inni

   • There is too much humidity inside

2. svo við setjum þvottagrindina nær glugganum

   • so we put/move the drying rack closer to the window

So the pattern is:

• problem/situation
• result/action

That makes the sentence very practical and natural for everyday speech.