Reykjavík city is full of great hotels

What are the best hotels in Iceland? Where are the best hotels in Reykjavík? Where to book accommodation in Iceland? What is accommodation in Iceland like? Read about best value hotels and luxury hotels in Iceland here.

Have you booked your flight to Iceland but are now wondering where to stay? Iceland offers a variety of accommodation, including camping, private cottages, hostels, bed and breakfast, farm stays, Air BnB as well as a variety of hotels, both good value hotels and luxury hotels.

There are a few hotel chains in Iceland. Foss hotels have 12 hotels around the country. The newest one, Fosshotel Glacier Lagoon, is a 4 star hotel that opened in 2016 in a gorgeous location close to Jökulsárlón glacier lagoon. Another one of our favourites is Fosshotel Vatnajökull, that has a great view of the stunning Vatnajökull glacier. 

Another chain is Icelandair hotels, with a total of 9 hotels dotted around the country. Our favourite is the Icelandair hotel in Vík, a new and stylish hotel in a beautiful setting. Note that breakfast is not included in the prices at Icelandair hotels but can be purchased when you book.

KEA hotels have a total of 8 hotels around the country, thereof 5 in Reykjavík, 2 in Akureyri and one by Lake Mývatn. The KEA hotel in Akureyri has the most perfect central location, right next to the iconic church and the ever so popular Akureyri swimming pool. However, our favourite has to be the newly opened Apótek hotel in the centre of Reykjavík, in one of Reykjavík's landmark buildings. If you want to treat yourself to a great meal in Iceland, check out Apótek restaurant as well, no matter if you're staying at the hotel or not.

Delicious food at Apótek restaurant in Reykjavík

Center hotels have 6 different hotels, all in Reykjavík. For a stay in Reykjavík, any of the Center hotels are a good option as they are all centrally located, stylish but still good value for money. Check out the Ský Lounge Bar at Center Hotel Arnarhvoll for the best view of the Northern Lights from Reykjavík city, as it is situated high up above the streetlights.

Edda hotels is Iceland's oldest summer hotel chain, now with 11 hotels around Iceland. The hotels are only open during summer time and most of them close mid August.

The chain hotels are mostly good value no matter which hotel you pick. The newer hotels are more stylish, are more likely to be 4 star hotels and may have more amenities, such as spas or gyms. The older hotels are cheaper and have a certain quirky charm about them. We at Guide to Iceland have made a list of our top 10 hotels in Iceland, which is not only based on luxury, comfort and style but also value for money. 

Luxury Hotels in Iceland

This is NOT a typical luxury hotel in Iceland! ;)

First up, let us tell you a little bit of what to expect when you book a luxury hotel in Iceland. When it comes to luxury in Icelandic hotels, you should not expect the same luxury as you'll find in the top hotels around the world! There are no 5 star hotels in Iceland - but quite a few 4 star hotels.

Iceland's first 5 star hotel, a Marriott Edition hotel, is set to open in downtown Reykjavík, next to Harpa Concert Hall in 2019. It will have conference and meeting rooms, several restaurants and spa facilities and be in an unbeatable central location.

The general emphasis of hotels in Iceland is on the surrounding nature. Even the most luxurious hotels in Iceland won’t offer much more than friendly service, only one good restaurant and bar, comfortable and clean rooms that are en-suite, continental or buffet breakfast and possibly a pool, spa and/or a sauna. Perhaps even a tiny gym.

So if you’re used to a 5 star hotel luxury, take note that your Icelandic luxury will be a bit more rustic, wild and intimate. There won’t be multiple pools or restaurants anywhere or champagne breakfasts. Some hotels may not have the possibility to get breakfast in bed. Some may not even have room service. Others may only have shared bathrooms. They’re pretty much self-service. And you can forget about a pillow or a duvet menu!

It's not all doom and gloom though!

View from luxury hotel Búðir in Iceland

On the other hand, many hotels are family run and they strive to provide you with good and friendly service. Many new restaurants are popping up that use Icelandic fresh and local ingredients and most hotels in the countryside are ideally situated, surrounded by stunning nature. 

Iceland is rich in minerals and hot springs and if the hotel doesn’t boast its own spa, it may be situated very near one. Whereas most hotels don’t have a gym, they may have a nearby mountain to climb or various hiking trails. Or horses on site to go horseback riding. And Reykjavík’s hotels compete with each other in good design, good restaurants and cocktail bars.

On top of that, many hotels have their own cute and quirky charm that you can see in small details.

Iceland’s tourism industry is young and the service is constantly improving. That’s something to consider when you look through menus or websites that may contain a spelling mistake or two.

For a romantic getaway break then you might also want to look into booking your own personal countryside cabin. Icelandic summer cabins, or cottages, can be found all over the country, varying in amenities and luxury. The majority of them have a hot tub though, and are situated in amongst the spectacular nature, tranquil and secluded. There's no better way to enjoy the Northern Lights than from your own hot tub, far away from any light pollution - it really is the best seat for the show!

To find a suitable cabin, you can browse through a variety of them in different regions of Iceland on the Bungalo website.

But if your heart is set on a hotel, then the following list is a mix of luxurious hotels, apartment hotels, small boutique hotels as well as more basic hotels that are good value. We want to be able to cater to all tastes.

10. Hotel Katla

Hótel Katla country hotel in Iceland

This traditional 3 star country hotel is great value for money and in a fantastic location. It's also recently been renovated, offering a number of new and stylish accommodation mixed in with rooms in an older style.

Situated near the village Vík you have easy access to some of the country's most breathtaking locations, such as Dyrhólaey cliffs, Seljalandsfoss waterfall and Skógafoss waterfall.

The interior of Hótel Katla in south Iceland

Many people that are driving the south coast of Iceland from Reykjavík towards Jökulsárlón glacier lagoon choose to spend the night at Vík and then Hótel Katla is a great and affordable option.

All guests have access to their outdoor hot tubs and the restaurant serves a buffet breakfast and a delicious and extremely varied dinner buffet with local specialities. There is also a cosy bar where you can have a drink before or after dinner.

Triple room at Hotel Katla in south Iceland

Rooms: Standard and superior single, double and triple rooms. 

The breakfast buffet is included in all prices.

For updated prices, check Hotel Katla’s website

9. Hotel Flatey

Hótel Flatey in Iceland and its surroundings

Hotel Flatey is a really cute small hotel in a restored building that offers 11 rooms with space for 27 people.

This is the only hotel in the sparsely populated Flatey island, that's truly one of Iceland's gems. Flatey is the largest island on Breiðafjörður fjord but it only has a population of about 100 people during summer and about 5 during winter.

You'll find a lot of puffins in Flatey island during summer

The island's appeal lies in its tranquility and remoteness. Most of the colourful houses have been restored in their original style, from the time of the island's prosperity. Besides birdwatching and strolling around the island (it takes about 30 minutes) there's not much else to do but let go of your worries and let your imagination take hold of you. The perfect place to be inspired. 

The rooms in Flatey Hotel are small and simple, but with a stylish Nordic decoration, freshly picked flowers, cosy and charming. Their restaurant, Samkomuhúsið, serves delicious food, mostly freshly caught seafood. There are no en-suite rooms, all of the rooms have shared facilities. The hotel is only open in the summertime, between the 1st of June and the 24th of August.

A room at Hotel Flatey in Iceland

Rooms: Single, double, suite (2 people) and triple rooms.

Breakfast is included in all prices.

For updated prices, check Hotel Flatey’s website

8. Room With a View Apartments

Rooftop view from Room with a View apartments in Reykjavík

Room with a view is a luxury apartment hotel in the centre of Reykjavík. The apartments come in different shapes and sizes but are all situated right in the centre of Reykjavík, literally on the main shopping street, Laugavegur.

All of the apartments have a fully furnished kitchen and a private bathroom, although their best value apartments have a private bathroom that's across a corridor. Bright colours mixed with white, black and grey dominate the decorations but each apartment is unique.

All of the apartments have access to a shared sun-roof with a jacuzzi, a lounge with tables and chairs and a great view over the city.

Room with a View studio apartment in Reykjavík

The hotel is a part of IGLTA, the International Gay and Lesbian Travel Association and doesn't discriminate against guests of any sexuality.

This is a great option for people that want to be at the heart of the city, on a romantic getaway, a weekend party vacation or on a business trip. All the bars, restaurants and shops are a stone throw away.

Room with a View 4 bedroom apartment in Reykjavík

Rooms: Studio apartments, larger apartments, group apartments, penthouse apartments.

Breakfast is not included.

For updated prices, click here.

7. Frost and Fire Hotel

Frost and Fire hotel in Iceland at night

Frost and Fire (Frost og Funi in Icelandic) is a lovely hotel situated in Hveragerði, a mere 45 minute drive from Reykjavík.

The hotel’s focus is on the hot springs in the area and they offer a 12 metre long pool, a hot tub and an indoor spa with hot and cold Kneipp footbaths and newly opened mud baths.

Additionally, you can always go for a soak in the nearby naturally warm river. In summertime the river’s temperature next to the hotel can reach up to 18°C. Each guest is provided with a bathrobe and slippers during their stay.

One of Frost and Fire hotel's rooms

The hotel also boasts the restaurant Varmá, that serves delicacies such as wild game goose, ptarmigan and reindeer as well as traditional lamb and seafood.

From Hveragerði you can hike up to the warm river in Reykjadalur where you can bathe, or go on a horseback riding tour to Reykjadalur hot springs. Further up in Reykjadalur valley you’ll reach the warmest part of the river, where it’s as warm as a hot tub.

Hveragerði itself is famous for its greenhouses and all the nearby hot springs. From the hotel you’ll see steam rising all around you and the crackling of the nearby hot springs can help you fall asleep at night.

Our local Regína went to stay here and you can read more about her stay in her blog post about Frost and Fire Hotel.

Relax in a hot tub by the warm river at Frost and Fire hotel

Rooms: Single, double and family rooms.

Breakfast is included in all prices.

For updated prices, check Frost and Fire's website

6. Hotel Rangá

Hótel Rangá in Iceland during winter

Hótel Rangá is situated in the south of Iceland, near the small town Hella. This is a luxury hotel that feels somewhat like a wild wooden ranch in the middle of nowhere.

The hotel prides itself on being one of the best locations to see the Northern Lights as it is far away from any other light sources. They even offer a service where they can wake you up if the lights appear while you are asleep.

The hotel is famed for having delicious food at their restaurant, although it may come with a hefty price tag.

The African suite at Hotel Rangá in south Iceland

They are also famous for the themed decoration of their junior and master suites, as they are somewhat outrageously themed after the world's continents. Their Antarctica suite is for example decorated with (fake) penguins, the African suite has a fair share of wooden giraffes and animal prints and their North American suite is full of stuffed animals and bear skins.

The Antarctic suite at Hotel Rangá in south Iceland

They also offer standard and deluxe rooms and the Royal Suite, which are not themed after a continent.

There are quite a few extras available at this hotel, you can order a massage and a number of items can be delivered to your room, such as cheese platters, bouquets of flowers, chocolate covered fruits, champagne bottles etc. Jacuzzis are also available to relax in outside the hotel, from where you can admire the Northern Lights on a clear night.

The view from the hotel is towards the volcano Hekla or to the nearby salmon river that the hotel is named after, Eystri Rangá.

It's an hour's drive from Reykjavík to Hotel Rangá and it's a great location to go and explore the south coast of Iceland from. Perfect location if you want to go salmon fishing or horseback riding.

Deluxe double room at Hotel Rangá in south Iceland

Rooms: Standard single and double, Deluxe single and double, themed Junior Suites and Master Suites.

Breakfast buffet is included in all prices.

For updated prices, check Hotel Rangá’s website

5. Hotel Egilsen

Hótel Egilsen is in a traditional wooden Icelandic house

Hótel Egilsen is a small and intimate 10 bedroom boutique hotel situated in Stykkishólmur on Snæfellsnes peninsula.

This homely and cute hotel is run by the story lover Gréta. Every morning she cooks healthy homemade breakfast with local fresh organic eggs. For lunch she serves freshly made soup with herbs from her own garden, along with homemade bread and mozzarella. Around 3 o’clock she’s serving homemade waffles or blueberry pies with ice-cream from a local farm. And besides making food, she listens to and tells stories.

Hotel Egilsen's cosy lounge

The hotel centres around stories in all shapes and sizes. Locals regularly come to the guest lounge to tell stories. Guests that tell Gréta a story, poem or send her pictures or draw a picture for her, get a special treat. (Maybe even a discount off their stay!)

The 10 rooms are small but bright, with attention to detail. All rooms are en-suite. In every room is a Coco-Mat bed that's made from natural materials from renewable sources, specially selected to give the guests a good night's sleep.

Bright furniture and attention to detail at Hotel Egilsen

Stykkishólmur featured prominently in the movie The Secret Life of Walter Mitty, as it was used to portray a town in Greenland. It is one of Iceland’s prettiest towns, situated on the northern side of Snæfellsnes peninsula with a view over the Breiðafjörður fjord. Breiðafjörður is full of small islands of every shape and size, the largest one being Flatey island.

Many boat tours operate from Stykkishólmur, both the ferry Baldur that goes via Flatey island over to the Westfjords as well as various daytours, including this Viking Sushi Adventure tour.

Bike rentals are available from the hotel and Snæfellsjökull glacier is just about an hour’s drive away.

One of Hótel Egilsen's bright rooms

Rooms: Standard single, standard double, superior double.

Breakfast is not included and costs an additional 2500 ISK per person.

For updated prices, check Hotel Egilsen’s website

4. Hotel Laxá

Hotel Laxá in Iceland

Hótel Laxá is a 3 star hotel by Lake Mývatn. It opened in 2014, quickly received a certificate of excellence from Tripadvisor and aims to be green and eco-friendly.

The hotel’s fun and funky décor is also stylish and the hotel boasts a lounge, bar and a restaurant that has an emphasis on local ingredients.

Great views at Hotel Laxá in Iceland

Lake Mývatn is one of Iceland’s gems. It’s famous for its spectacular nature, full of pseudo-craters, interesting flora and fauna, peculiar rock formations and hot springs.

Nearby you’ll find Dimmuborgir (Dark Cities), a great area to explore on foot with its hauntingly beautiful lava landscape. You can also head to Mývatn Nature Baths and soak in hot natural water. Or go fishing in Laxá river.

Hotel Laxá's double room

Rooms: Single, Single with lake view, Double, Double with lake view. All rooms are ensuite.

Breakfast is included in all prices.

For updated prices, check Hotel Laxá’s website

3. Hotel Búðir

Hotel Búðir at Snæfellsnes peninsula

Búðir is an upscale but cosy country hotel on the Snæfellsnes peninsula, not too far from Arnarstapi. The location of the hotel is exceptionally idyllic and romantic, nearby one of Iceland’s three national parks.

You have a view of the looming Snæfellsjökull glacial volcano, by the coast you can admire the crashing waves of the Atlantic Ocean on a white beach and on a clear day you have a view across the bay to Reykjavík! There are many hiking routes in the area, an otherworldly lava field covered with squishy moss, a rich birdlife and an abundance of caves to explore.

This location is exceptionally popular for weddings, as the ceremony can be held in the nearby picturesque black wooden church, on the white beach or in the midst of a lava field! 

View from Hotel Búðir's beach to Snæfellsjökull glacier in wintertime

Snæfellsjökull glacier is the entryway to the centre of the Earth in Jules Verne’s novel Journey to the Centre of the Earth. Many people feel the natural power of this glacial volcano when they are near it. The summit can be reached after a few hours hike and you can also choose to go snowmobiling on it.

Hótel Búðir in Iceland

Rooms: The Loft, Standard, Deluxe, The Suite.

Breakfast is included in all prices.

For updated prices, check Hotel Búðir’s website

2. Hotel Sigló

Room at Hotel Sigló in Iceland

This brand new hotel in picturesque Siglufjörður in north Iceland is the only hotel in Iceland with a dock entrance! So if you arrive on a boat, you’ll have a private harbour.

Hotel Sigló is stylish but with a definite small fishing town charm, more due to its location than its decoration. It's actually extremely modern with a very spacious lobby, big rooms and a stylish outdoor hot tub right next to the marina. All rooms have ocean and mountain views and all guests have access to their hot tubs and sauna.

Sigló Hótel in Iceland

You don’t need a boat to reach the gorgeous town of Siglufjörður. It is one of Iceland’s hidden gems, slightly off the beaten track but easily reachable by car. It is situated on Tröllaskagi (Troll peninsula!) in the north of Iceland, not far off from Akureyri, the capital of the north.

The hotel is situated within the Marina Village, along with the neighbouring restaurant Hannes Boy and the café Rauðka. The hotel itself also boasts a lobby bar and café and a delicious restaurant called Sunna. You might even catch a glimpse of the chef picking out the freshest fish when the fishing trawlers sail in.

Hannes Boy and Kaffi Rauðka near Hotel Siglo

Siglufjörður used to be quite isolated as the mountain pass to reach it wasn’t opened until 1967. Before then, people had to sail in and out of the town. Take advantage of this mountain pass and go explore this beautiful town, its nearby hiking trails, planted forest or its great skiing area.

Rooms: Classic, Deluxe, Junior Suite and Suite.

Breakfast is included in all prices.

For updated prices, check Sigló Hotel’s website for more details. 

1. Icelandair Hotel Reykjavík Marina

Our number one hotel is located by the old harbour in the centre of Reykjavík – and a part of the Icelandair hotel chain. We think this is a fun and modern hotel, and the best value hotel you can get in the capital. It’s in an exciting location, right between the town's centre and the trendy and arty sector of town in the Grandi area.

The hotel itself has a funky design, with bright colours, cosy fireplaces as well as a maritime theme. All the design in the hotel is Icelandic and is also produced in Iceland. 

Hotel Marina superior double room

Slippbarinn restaurant and bar is popular with both locals and travellers, often hosting live pop up music events and DJ's playing on weekends. Every day between 15 and 18 there's a happy hour at the bar. The café Kaffislippur is a part of the hotel as well, featuring a nice delicatessen. Additionally the (not included) breakfast buffet is delicious!

The hotel features a small cinema that can be hired and that screens kid's films during brunch time at weekends. There's also a small gym on site for guests as well as a couple of meeting rooms.

Gym at Marina Hotel in Reykjavík

As the hotel is situated right next to Reykjavík’s old harbour, you’re very close to a number of exciting seafood restaurants. Right next door is the popular Bryggjan Brewery and close by are some of Reykjavík's most celebrated art galleries and museums. Any of the main attractions within the city centre, such as Hallgrímskirkja church, Harpa Concert Hall or the city pond are within a 5-15 minute walking distance.

Rooms: Standard, Superior, Studio, Attic Rooms, Deluxe Rooms, Junior Suites and Marina Suite.

Breakfast is included in all prices. For updated prices, check Icelandair Hotel Marina's website