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Hostels in Iceland

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All You Need To Know About Hostels in Iceland

Hostels in Iceland are the top choice for travelers looking to explore the country’s incredible landscapes without overspending. This guide provides everything you need to plan your budget-friendly stay in 2025, including top lists of the best hostels in Reykjavik, South Iceland, North Iceland, and beyond.

With detailed regional recommendations, insider tips, and essential information, you’ll find the perfect base to experience Iceland’s natural wonders, vibrant culture, and social hostel scene.

Top Hostels in Iceland by Region

Hostels in Iceland can be found in most regions of the country. This list highlights all the best hostels in each part of Iceland to help you find the perfect base for your trip.

Top 3 Hostels in Reykjavik

Reykjavik has the largest selection of hostels in Iceland, offering options for travelers seeking cheap and convenient accommodation in the capital. The hostels in Reykjavik are known for their central locations, social atmosphere, and modern amenities.

  1. KEX Hostel: Located about a 10-minute walk from Hallgrimskirkja and Reykjavik’s main shopping street, Laugavegur, KEX Hostel offers industrial-chic decor and a vibrant social atmosphere. Its bar and communal spaces make it a top choice for travelers who enjoy meeting people while staying close to popular attractions.
  2. Loft Hostel: Situated directly on Laugavegur, Loft Hostel is perfect for travelers who want easy access to Reykjavik’s shops, restaurants, and nightlife. The rooftop terrace creates a welcoming space to relax or connect with fellow guests, making it a great option for travelers seeking community.
  3. Bus Hostel Reykjavik: Positioned about a 20-minute walk (or 5-minute bus ride) from downtown Reykjavik, Bus Hostel is close to major bus routes, making it a practical choice for budget travelers planning day trips. The quiet setting and affordable dorms are ideal for those prioritizing value and a low-key environment.

Top 3 Hostels in South Iceland

South Iceland is a must-visit region, home to iconic attractions like Seljalandsfoss, Skogafoss, and Reynisfjara Beach. Hostels in South Iceland provide convenient access to the region’s natural wonders.

  1. The Barn Hostel (Vik): Located about a 10-minute drive from Reynisfjara Beach, this modern hostel in Vik features stylish communal spaces, shared kitchens, and cozy rooms. It’s a great choice for backpackers and nature lovers exploring South Iceland.
  2. Midgard Base Camp (Hvolsvollur): Close to Seljalandsfoss and Thorsmork, this hostel offers dorms, private rooms, a hot tub, and a bar. With a friendly, community-focused atmosphere, it’s ideal for active travelers and adventurers.
  3. Eyrarbakki Hostel (Eyrarbakki): Located in the small coastal village of Eyrarbakki, this hostel provides basic accommodations for budget travelers. It’s a simple option for those passing through or looking for an affordable place to stay near the ocean.

Top 3 Hostels in South East Iceland

South East Iceland is known for its glaciers, dramatic coastlines, and attractions like Jokulsarlon Glacier Lagoon. Hostels near Hofn provide convenient access to top attractions in the south east of Iceland.

  1. Skyrhusid Guesthouse (Hofn): Located about 25 minutes (28 km) from Jokulsarlon Glacier Lagoon, this hostel offers cozy stays and easy access to glacier tours and ice caves. It’s a practical choice for exploring the eastern edge of the South Coast.
  2. Vagnsstadir Hostel (Vagnsstadir): Just 15 minutes (14 km) from Jokulsarlon Glacier Lagoon, this hostel offers simple but comfortable dorms and private rooms. Its location is ideal for travelers wanting to stay close to Iceland’s glacial attractions.
  3. Hofn Hostel (Hofn): Situated in the center of Hofn, this hostel is a great base for exploring the Vatnajokull glacier and surrounding area. It offers a mix of private rooms and dorms, catering to solo travelers, couples, and small groups.

Top 3 Hostels in East Iceland

East Iceland is known for tranquil fjords, charming villages, and less-traveled routes. Hostels in this region provide comfortable bases for exploring the Eastfjords and nearby attractions.

  1. Hafaldan Hostel (Seydisfjordur): This hostel is set in a renovated hospital building and features cozy rooms and a sauna. It’s a great option for travelers looking to discover one of the most picturesque fjord towns in Iceland.
  2. Berunes Hostel (Berunes): Situated in a peaceful area with stunning mountain views, this farmhouse-style hostel offers a relaxed atmosphere. It’s ideal for travelers seeking a quiet stay while exploring the Eastfjords.
  3. Hostel Framtid (Djupivogur): Found in the coastal village of Djupivogur, this hostel provides budget-friendly accommodations with both private and shared options. Its central location makes it perfect for travelers stopping along the Ring Road.

Top 4 Hostels in North Iceland

North Iceland combines the livelier atmosphere of Akureyri with the tranquil charm of smaller coastal towns. Hostels in this region provide excellent access to attractions like Lake Myvatn and the Trollaskagi Peninsula.

  1. Akureyri Backpackers (Akureyri): Located in central Akureyri, this hostel is perfect for social travelers. With an on-site bar, restaurant, and communal areas, it’s a lively base for exploring the city’s shops, cafes, and nearby attractions.
  2. Hafnarstraeti Hostel (Akureyri): Also centrally located in Akureyri, this hostel offers a quieter stay with modern dorms and private rooms, a fully equipped kitchen, and social common areas. It’s ideal for travelers seeking comfort and convenience.
  3. Husavik Green Hostel (Husavik): Situated just a short walk from Husavik Harbor, this eco-friendly hostel is a great choice for travelers planning whale-watching tours or exploring Husavik’s museums.
  4. Dalvik Hostel (Dalvik): Set in the peaceful fishing village of Dalvik, this hostel is perfect for travelers exploring the Trollaskagi Peninsula or taking a ferry to Grimsey Island. It offers simple facilities and a friendly, community-oriented vibe.

Top 3 Hostels in Westfjords

The Westfjords offer some of Iceland’s most remote and untouched landscapes, perfect for adventurers seeking solitude and dramatic scenery. Hostels in this region provide simple, comfortable stays for travelers exploring this rugged corner of Iceland.

  1. Korpudalur Hostel (Flateyri): Located in a calm valley near Flateyri, this cozy hostel offers stunning mountain views and a peaceful atmosphere. With a shared kitchen and communal spaces, it’s ideal for travelers looking to unwind in nature.
  2. Broddanes Hostel (Broddanes): Perched along the scenic coastline, this hostel offers basic but comfortable accommodations with panoramic sea views. It’s a great choice for those seeking a quiet retreat to appreciate the beauty of the Westfjords.
  3. Hvammstangi Hostel (Hvammstangi): While not located in the Westfjords, this hostel on the Vatnsnes Peninsula is a convenient stop for travelers heading to or from the region. The area is known for its seal colonies and stunning coastal views.

Top 2 Hostels in Snaefellsnes

The Snaefellsnes Peninsula is known for its diverse landscapes, from glaciers and lava fields to charming fishing villages. Hostels in this region provide affordable and comfortable stays for travelers exploring the west of Iceland.

  1. The Freezer Hostel (Rif): Situated in the small village of Rif, this hostel doubles as a cultural center, hosting live performances and events. With dorms, private rooms, and communal spaces, it offers a comfortable base in Snaefellsnes.
  2. Grundarfjordur Hostel (Grundarfjordur): Located in the beautiful Grundarfjordur, this hostel offers cozy accommodations with views of the iconic Kirkjufell mountain. It’s an excellent base for travelers planning to hike and explore nearby attractions.

Hostels Along Iceland’s Ring Road

Travelers driving and exploring the Ring Road (Route 1) on a budget will find hostels along the entire route, allowing for cheap accommodation. Here’s an example of a 10-day budget-friendly road trip itinerary with hostels along Iceland’s Ring Road:

Tips for Choosing the Right Hostel in Iceland

Finding the right hostel can make your trip to Iceland more enjoyable and stress-free. Here are some tips to help you choose the right one:

  • Consider location: Look for hostels close to attractions, transportation hubs, or city centers to save time and effort.
  • Check amenities: Ensure the hostel meets your needs with features like free Wi-Fi, shared kitchens, or laundry facilities.
  • Read reviews: Check reviews to get other travelers’ opinions on cleanliness, staff friendliness, and the overall vibe.
  • Assess atmosphere: Solo travelers may prefer hostels with social spaces, while couples or groups might value more privacy.
  • Book early: Iceland’s hostels fill up quickly, especially in summer. Reserve your spot in advance to secure the best options.

Summary

Staying in hostels is the best way to travel Iceland on a budget. With us at Guide to Iceland, you can easily find and compare top hostels across Iceland. We offer a best price guarantee and flexible cancellation policies, making planning your trip simple and stress-free. In conclusion, hostels in Iceland offer affordable, comfortable, and convenient stays, no matter where your journey takes you.

Frequently asked questions

What are the best hostels in Iceland?

In Reykjavik, KEX Hostel is a top pick, known for its central location, lively bar, and social atmosphere with regular live music. For travelers heading beyond the capital, The Barn Hostel in Vik is one of the best hostels on the South Coast, located near Reynisfjara Black Sand Beach. In the north, Akureyri Backpackers provides a great mix of affordability and comfort in Iceland’s second-largest city.

What is the best hostel in Akureyri, Iceland?

The best hostel in Akureyri is the Hafnarstraeti Hostel. It is the perfect option for travelers on a budget in Iceland's 'Capital of the North.' Unique to Iceland, it is a Japanese-style capsule hotel with single or double capsules in a mixed dormitory. The hostel is located right in the center of Akureyri, so there's a short distance to all the main attractions in the town. It has a rating of 4.5 out of 5 stars from 269 reviews.

What is the best hostel in Vik, Iceland?

The best hostel in Vik, on Iceland's south coast, is The Barn. It is a rustic yet modern hostel for budget travelers who want to stay somewhere affordable and chic. It's located a 10-minute drive from the village, meaning it's great for viewing the northern lights in the winter as it is away from light pollution. It's also close to the Reynisfjara black sand beach and the Reynisdrangar sea stacks. It has a variety of lodgings, from an 8-bed dormitory to double rooms for couples that want privacy.

What are the advantages of staying in a hostel in Iceland?

Hostels offer an affordable and social way to explore Iceland. They are ideal for budget travelers and solo backpackers looking to meet fellow travelers. Many hostels have communal kitchens, shared lounges, and organized activities, making them a great place to connect with others while saving on accommodation costs.

Is it cheaper to stay at a hostel than a hotel in Iceland?

Yes, hostels are normally more affordable than hotels in Iceland. A dorm bed typically costs 30 USD to 70 USD per night, while private rooms in hostels start around 80 USD to 150 USD. In comparison, budget hotels in Iceland usually start at 150 USD per night, with mid-range options often exceeding 200 USD.
Hostels also help travelers save money with shared kitchens, allowing you to cook instead of dining out. For budget-conscious travelers, staying at a hostel is the best way to keep accommodation costs low while exploring Iceland.

Can I find hostels in Iceland with private bathrooms?

Yes, some hostels in Iceland offer private rooms with private bathrooms. For example, Loft Hostel in Reykjavik provides private rooms with en-suite bathrooms for those who prefer more privacy.

Do hostels in Iceland have kitchens?

Yes, most hostels in Iceland have a communal kitchen where you can keep your food or cook your meals while traveling the country. It is a great budget option to save money on food, so you can spend more money on tours and exploring the country.

Do hostels in Iceland provide breakfast?

Many hostels in Iceland offer breakfast, though some include it in the booking price while others charge extra. Check the hostel’s description before booking to see if breakfast is provided and whether it’s complimentary.

Do hostels in Iceland have lockers?

Yes, most hostels in Iceland have lockers where guests can safely store valuables and belongings.

What amenities can I expect at hostels in Iceland?

Most hostels in Iceland offer free Wi-Fi, shared kitchens, common areas, and luggage storage. Many also have laundry facilities, private room options, and tour booking services. Some hostels include extras like saunas, hot tubs, or on-site bars. Amenities vary, so check before booking.

Do hostels in Iceland offer parking?

Some hostels in Iceland offer free parking, especially those located outside Reykjavik. However, hostels in city centers may have limited or no parking available. Check the hostel’s details before booking if parking is needed

Are hostels in Iceland only for young people?

No, hostels in Iceland are not only for young people. Hostels welcome travelers of all ages and backgrounds, providing a social and communal atmosphere for guests to meet and interact with fellow travelers.
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