The story of the two families who together created Litlibær farm in Skötufjordur fjord is typical of poor people who made a start empty-handed but succeeded by efficiency and hard work to rise to self-sufficiency and provide for large families. They lived off the land but also harvested much more from the sea and its rich fishing grounds.

The first farming families here at Litlibær were Guðfinnur Einarsson and his wife Halldóra Jóhannsdóttir who had fifteen children, of whom nine reached maturity and Finnbogi Pétursson and his wife Soffía Þorsteinsdóttir who raised eight children, of whom seven reached maturity.