Halldor was born in 1902 in Reykjavik, where he lived until 1905 when his family moved to Laxnes in Mosfellsdalur near the town of Mosfellsbær about 15 km east-northeast of the capital. At a young age he started to read books and write stories. In the winter of 1915-1916 he attended the technical school in Reykjavik. In 1916 he had an article published in the newspaper Morgunblaðið. His first book, the novel Barn náttúrunnar: ástarsaga (Child of Nature: A Romance), was published in 1919 when Halldor was seventeen years old. By the time of the novel's publication he had already begun his travels on the European continent.