Where to Stay in Reykjavik, Iceland (2024): Accommodation & Area Guide

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Wondering Where To Stay In Reykjavik, Iceland? Here Are Our Tips!

With so many great Reykjavík accommodation options in many nice areas, choosing the best place to stay in Reykjavík for you can seem like a daunting task! This is where we come in.

Eric first visited Reykjavík on a Europe trip a few years back, fell in love with the country, and has been back several times since.

Staying with local friends allowed him to get to know the city pretty well. That local even wrote a guide on what to know before visiting Iceland!

In any case, we’re familiar with the Icelandic city.

So, in this guide, we’ll dive into accommodations in Reykjavík by style and budget including popular Reykjavík downtown hotels like Center Hotels Plaza or Hotel Borg.

Then, we’ll outline the great areas or neighbourhoods to stay in Reykjavík with examples of accommodations in each! This way, you’ll hopefully find the best area to stay in Reykjavík for you!

Friendly Disclosure: We paid for the accommodation we stayed at ourselves and were not told to include it in this article.

Accommodations By Type

Reykjavík is one of our favourite Nordic capitals to visit. With so much to offer different kinds of travellers, it’s no surprise that the capital city is a popular place to explore.

Reykjavik has a pretty good mix of accommodation types to suit all these different travellers.

Whether you’re a honeymooning couple or family of four, you’ll find Reykjavik lodging like hotels, guesthouses, apartments, and hostels strewn across the city.

Similar to cities in other Nordic countries, Reykjavík can be quite expensive. The Nordic countries, in general, have a higher cost of living compared to other parts of Europe. This is reflected in the prices of the accommodations.

This post is split up into two main sections: the first section is on the best places to stay in Reykjavik, Iceland by type while the second part walks you through some of the better areas to stay in Reykjavik (where we would stay).

So, if you know what kind of accommodation you are looking for, you can get started looking right below.

Alternatively, if you want to book a specific area of Reykjavik to stay in, you can scroll down further to read and then have a look at accommodations in that area.

Hotels in Reykjavík

Hotels are a very popular accommodation option in Reykjavik. With the tourism boom of the last decade, there is no shortage of hotels in the Icelandic capital!

While the boom might be cooling off, the result is that Iceland has solidified itself as a top destination with hotels that cater to lots of different travel styles.

As for locations, there are hotels in downtown Reykjavik as well as in nice areas a short walk or drive from the centre.

As you might imagine, hotels in Reykjavik (especially in the city centre) can be more expensive – but you pay for the central location and amenities.

Get started searching for hotels in Reykjavík

If you know you are searching for popular hotels in great areas that balance value, location, and amenities, have a look at the following list.

Popular Reykjavík Hotels

Budget/Cheap Hotels in Reykjavík

As mentioned above, Reykjavík can be a more expensive city. This is why cheap lodging in Reykjavik is in demand.

Luckily, if you are searching for cheap places to stay in Reykjavik, you will have some luck finding cheaper hotels in Reykjavik.

Keep in mind that “cheap” doesn’t necessarily mean the hotels are unsafe or bad. In Reykjavik, cheap hotels often are simple, “no-frills” places that offer fewer amenities compared to other hotels.

Because it’s an expensive city in general, many of the more budget hotels in Reykjavik are actually quite nice. If you are looking for a budget hotel in Reykjavik, check out these options below:

  • Hotel CabinA simple, no-frills hotel in Laugardalur (Our Pick)
  • Fosshotel BaronA cool and clean hotel overlooking the mountains in Miðborg
  • Fosshótel RauðaráA traditional yet reliable hotel walkable to city centre in Hlíðar
  • Guesthouse Pavi – A very basic hotel steps from Hlemmur bus station/downtown close to Laugardalur

Boutique Hotels in Reykjavík

Reykjavík is already a unique city – one that often seamlessly merges modern and traditional around every corner.

And with a wide variety of travellers (and their desire for unique styles) coming to the city, it’s no surprise that you can find many boutique hotels in Reykjavík.

Often a strong mix of style, light, colour, and amenities, these unique hotels in Reykjavik aren’t your typical accommodations!

You can find some of the cool places to stay in Reykjavik below:

  • ODDSSON HotelA trendy, modern hotel with breakfast in Laugardalur (Our Pick)
  • Eyja Guldsmeden HotelAn airy yet sophisticated boutique hotel in Hlíðar (Also Our Pick)
  • Exeter HotelA stylish and cool boutique hotel steps from the centre in Vesturbær
  • Grandi by Center Hotels A warm and colourful boutique hotel also by the water in Vesturbær

Luxury Hotels in Reykjavík

For those travelling to Iceland looking to be pampered, there are a few luxury hotels in Reykjavik to suit your fancy.

These four- and five-star hotels in Reykjavik offer travellers top amenities like access to spas (an Icelandic highlight) in great locations around the city.

Some offer views of the water and rolling landscape beyond, while others are situated in the heart of the city centre for maximizing exploration with ease.

Have a look at these standout Reykjavik luxury hotels:

Guesthouses/Bed and Breakfasts in Reykjavík

If you are looking for the traditional bed and breakfast experience in Reykjavik, you will find a handful of them available.

In Reykjavik, these types of accommodations are usually called “guesthouses”. Many of the guesthouses in Reykjavik are cozy and offer breakfast.

Generally, most of the guesthouses/bed and breakfasts are in quieter, more residential neighbourhoods which can be a nice escape at the end of a long day of adventure.

Guesthouses are also usually run by passionate hosts with lots of local knowledge to pass along to their guests.

There are a few Reykjavik guesthouses right in the city centre but many are located just a short walk to shops, bars, and attractions around downtown (Miðborg). You can check here for guesthouses and bed and breakfasts in Reykjavík.

We’ve included a variety of nice B&Bs/guesthouses to get you started:

  • Eric the Red Guesthouse – A cozy, eclectic guesthouse steps from Hallgrimskirkja close to downtown (Our Pick)
  • Central Guesthouse Reykjavik – A warm and historic guesthouse in the heart of Reykjavik
  • Alba Guesthouse – A simple, cozy guesthouse a short walk to BSI Bus Terminal in Hlíðar
  • Igdlo GuesthouseA bright, popular guesthouse also a short walk to BSI Bus Terminal in Hlíðar
  • Blue House B&B – A cute yet modern (has Netflix) B&B west of the Vesturbær (able to see Northern lights if active!)

Need to Know: The naming of guesthouses and budget hotels is kind of blurred in Reykjavik. Some of the more budget hotels are called Guesthouses – while some genuine guesthouses (family-type homes like traditional B&Bs) are also called Guesthouses. The budget hotels are usually larger buildings while this section focuses on the cozy-style guesthouses run by hosts.

Apartments/Aparthotels in Reykjavík

Another very popular accommodation option is apartments and aparthotels in Reykjavik.

Apartments often come with kitchenettes or access to a guest kitchen so that guests (families, larger groups, budget travellers) can prepare their meals. Eating out can be pricey in Reykjavik!

Apartments are generally popular with larger groups or those travelling to Reykjavik with kids/as a family. Having a private space to call “home” for however long you’re in Reykjavik can allow you to explore to the maximum or recharge on your terms.

A popular sub-set of rental apartments are aparthotels. These hotels offer travellers their apartments (often with kitchenettes/kitchens) but have a reception and ground-floor space like a restaurant for breakfast.

This way, you have the best parts of a private apartment with the aid and knowledge of hotel staff close by. These accommodations are also not Airbnbs and don’t contribute to housing shortages so that’s a plus.

You can check here for great apartments/aparthotels in Reykjavík. Below are a few nice options in great locations around Reykjavik to get you started:

Hostels in Reykjavík

If you are on a tighter budget or backpacking, there are several hostels in Reykjavik you can stay at.

The thing about hostels is that – truthfully – you won’t save a ton of money if you choose this accommodation option. This is because accommodation in Reykjavik is generally just expensive overall.

Having said that, Eric stayed in a hostel one time he was in Reykjavik. He stayed at arguably the most popular one – KEX Hostel – for three nights and loved it. We mentioned it in our post on 27 European hostels we loved staying at.

The location down by the waterfront (close to downtown) is awesome, the staff were super friendly, and the room was great.

Also, the ground floor reception area is a popular hang-out spot/bar that gets lively during nights and weekends with live music and more.

If you want to look at Reykjavik hostels, you can start searching below.

Check here for hostels in Reykjavík

There aren’t a ton of hostels in Reykjavik so below is a short list of some top-rated ones to help you with your search:

  • KEX HostelA cool and popular hostel close to downtown with views in Miðborg (Our Pick)
  • Reykjavík – Loft HI Hostel – A warm, welcoming hostel right on the main street in the city centre
  • Galaxy Pod HostelA cool hostel with futuristic sleeping pods on Laugavegur between Laugardalur and Hlíðar
  • Bus Hostel Reykjavik – A standard, reliable hostel very close to the BSI Bus Terminal in Hlíðar
  • Dalur – HI Hostel – A relaxed hostel with lots of nearby green space in Laugardalur

Accommodations By Neighbourhoods/Areas

Having covered Reykjavik accommodations by type, we can now break down some of the best areas to stay in Reykjavik.

Reykjavik is essentially a long peninsula with the city centre located more in the middle between the tip and the base.

There are many great Reykjavik neighbourhoods and areas around this centre to choose from. This post covers five main areas in/around the city centre and one further away (KEF Airport).

Each of these areas offers something slightly different and caters to different travellers and their unique needs.

Remember: The best location to stay in Reykjavik for you might be very different than for another traveller – so browse with your needs in mind.

Tip: Some accommodations in central Reykjavik have direct pick-up/drop-off with the Flybus Airport Shuttle Bus. Others have a bus stop nearby for the same purpose. Here is the detailed list by Flybus of accommodations and the closest airport shuttle stop. We list the closest shuttle stop, if applicable, for each accommodation below.

In each section, we will give you a brief description of each area, describe what you can see and do there, and then provide well-rated accommodation suggestions in each.

Keep in mind, these are certainly not all the areas of the city. However, these are popular areas or areas where we have stayed previously. If we were to visit again, would genuinely search for accommodation in any of these locations.

If you know you’re travelling to Reykjavik, you can get started browsing accommodation top picks sorted by area and interest below. They are sorted from most centrally located to least centrally located, generally.

Top Reykjavík Accommodation By Area

This is a good time to mention that Reykjavik is a very safe city to visit. In fact, Iceland is one of the safest countries in the world.

Of course, as a traveller to a new place you should always be mindful of your surroundings, watch your belongings in crowds, and trust your instincts. At the same time, please be a respectful visitor!

That said, Icelanders are very kind people and are – in our experience – always willing to lend a hand.

Or, in Eric’s case, invite him over for a traditional Icelandic meal that included sheep’s head, smoked lamb, dried fish, and fermented shark.

Miðborg (City Centre) – Location & Sights

large concrete church facing down busy street with parked cars in city centre reykjavik
You know you’re heading downtown with Hallgrimskirkja at your back!

Known as Miðborg, the city centre area of Reykjavik is also lovingly referred to as “the 101” because of the postal code.

This larger, central area encompasses much of the city centre (with all the top sights, attractions, shops, etc) and Reykjavik City Airport to the south.

Within this area is a smaller, lively area known as the Centre. This is “downtown Reykjavik”. It’s hip and trendy – and often loud because of the bars and sights – but full of action.

The most popular streets in this area are Laugavegur (for shopping and cafes), which turns into Bankastræti (Bank Street) and then turns into Austurstræti (in Centre – the main hub of Reykjavik nightlife).

At the end of Austurstræti, you will be in the heart of the city centre at Ingólfur Square. There’s a small public park area with hotels, restaurants, and more to check out.

The whole Miðborg area is jam-packed with many of the top attractions in Reykjavik like Hallgrimskirkja (Church), The Icelandic Phallological Museum, City Hall, The Harpa (Concert Hall), Bæjarins Beztu Pylsur (famous Icelandic hot dog stand), and much more!

town square with grass and statue in middle shining in daylight
If you looked to the right – you’d see the beautiful Hotel Borg dominating this little park/square called Austurvöllur!

As for accommodation in this area, the is no shortage of places to stay in downtown Reykjavik.

The downtown Reykjavik hotels are plentiful – as are the number of guesthouses and apartments/aparthotels. Of course, this central location can sometimes come with a higher price tag.

Also, if you are wondering “is Reykjavik walkable” the answer is: Yes.

If you stay anywhere in the city centre you will be within walking distance of everything important – but that’s not necessarily for everyone!

Check Here For Accommodations In Miðborg

There are better areas to stay in the city if you’d like it to be quieter. That said, Miðborg is popular for a reason and you can find a more peaceful stay if you don’t stay right in the heart of Centre or along Laugavegur.

Featured Accommodations in Miðborg (City Centre)

If you know you want to stay in the Reykjavik downtown area, below are some great accommodations around the area.

These hotels, guesthouses, or apartments provide you with a mix of locations and styles and answer the question of where to stay in downtown Reykjavik!

Center Hotels Plaza – Check Now

  • Style: Stylish and Clean Hotel (one of the most popular Reykjavik city center hotels)
  • Price Range: Mid-range
  • Location: Right in city centre, overlooking Ingólfur Square
  • Featured Amenities: Nice breakfast, bar onsite
  • Flybus Shuttle Stop: Bus Stop 1 – Ráðhúsið – City Hall close by

Reykjavik Residence Apartment Hotel Check Now

  • Style: Modern Yet Comfortable Boutique Apartments
  • Price Range: Upper Range
  • Location: One street over from Laugavegur, steps from shops/restaurants and a quick walk to the heart of Reykjavik
  • Featured Amenities: Great in-suite breakfast available, very functional kitchenettes
  • Flybus Shuttle Stop: Bus Stop #14 – Skúlagata close by

Eric the Red Guesthouse – Check Now

  • Style: A Cozy and Eclectic Guesthouse
  • Price Range: Upper Budget
  • Location: Just steps from Hallgrimskirkja (big church), short walk to downtown shops
  • Featured Amenities: Communal kitchen free to use, free parking nearby, nice host
  • Flybus Shuttle Stop: Bus Stop #8 Hallgrímskirkja close by

Hotel Borg by Keahotels – Check Now

  • Style: An Elegant, Charming Hotel
  • Price Range: Luxury
  • Location: Right in the heart of the city centre, overlooking Austurvöllur close to other sights
  • Featured Amenities: Great breakfast, spa and gym on-site
  • Flybus Shuttle Stop: Bus Stop #3 – Lækjargata very close by

Hlíðar – Central Yet Quiet

small houses with green trees in foreground with blue sky above
The views from Perlan – everything to the right is Hlíðar with Hallgrimskirkja (church) in the distance!

Located adjacent to the east of the Miðborg area is the slightly quieter area of Hlíðar. This smaller, compact area is sort of an extension of the city centre.

That same busy street that runs through the city centre – Laugavegur – leaves that area and heads east through Hlíðar.

There are loads of hotels along this stretch that will have you within walking distance of the Centre.

Laugavegur is also a popular bus route – connecting with Hlemmur Central Bus Station which lies in this area. These bus connections can take you right into the city centre or elsewhere around the greater city region.

Bus Stop #13 (near Hlemmur) is also in this area and is one of the Airport Shuttle (Flybus) stops.

A bit south of here, this area also extends from behind Hallgrimskirkja into a gently sloping residential area where you’ll find some cozier guesthouses.

This is where Eric’s friend used to live and it was a great, quiet location close to the BSI Bus Terminal and downtown.

The BSI Bus Terminal is used as the main artery between Reykjavik and Keflavik Airport.

Check Here for Accommodations in Hlíðar

In the south of this region, you’ll find a top attraction known as Perlan. Overall, the area becomes greener and includes a park known as Klambratún (home to the Reykjavík Art Museum Kjarvalsstaðir).

Featured Accommodations in Hlíðar

Below are some accommodations in the Hlíðar area. Given the proximity to the heart of the city, there are still plenty of hotels to choose from.

However, the residential feel lends itself more to cozy guesthouses (especially in the area just behind Hallgrimskirkja (the big church).

Eyja Guldsmeden Hotel – Check Now

  • Style: A Beautiful, Airy Boutique Hotel
  • Price Range: Upper Range
  • Location: Right off Laugavegur, a short walk through shops/restaurants to the heart of downtown, Bonus Supermarket around the corner!
  • Featured Amenities: Sustainable toiletries, tea and coffee always available, great breakfast
  • Flybus Shuttle Stop: Airport shuttle pick-up/drop-off directly at hotel

Midgardur by Center Hotels – Check Now

  • Style: A Contemporary, Modern Hotel
  • Price Range: Upper Mid-Range
  • Location: Also right off Laugavegur, a short walk through shops/restaurants to the heart of downtown
  • Featured Amenities: Onsite bar/restaurant, really nice breakfast, gym/sauna/pools onsite
  • Flybus Shuttle Stop: Bus Stop 13 – Rauðarárstígur right beside hotel

Alba Guesthouse – Check Now

  • Style: A Simple, Cozy Guesthouse
  • Price Range: Upper Budget
  • Location: A quiet area, short walk to BSI Bus Terminal, longer walk/bus to downtown
  • Featured Amenities: Great breakfast, off-street free parking, shared bathrooms
  • Flybus Shuttle Stop: BSI Bus Terminal is closest

Stay Apartments Einholt – Check Now

  • Style: Clean and Nice Apartments
  • Price Range: Lower Mid-Range (for Iceland)
  • Location: Steps from Laugavegur and a short walk to the city centre, shops/market close by
  • Featured Amenities: Free parking available, kitchenettes in units, self check-in
  • Flybus Shuttle Stop: Bus Stop 13 – Rauðarárstígur close by

Laugardalur – Open & Nature

Also sometimes referred to as Reykjavik East (also area code 105), the Laugardalur area is much more spaced out and larger than the first two regions. This region is located one step further from the city centre (to the east of Hlíðar).

The area is even quieter, greener, and more residential. Given the fact that there are fewer buildings/lights around, this is an area where it’s more likely (still not a guarantee) to see the northern lights if the conditions are right.

Depending on where you stay in this area, it may still be possible to walk into the centre (about 40 minutes). You can just as easily take the bus for a much shorter ride to the centre.

Both methods of transport take you down Suðurlandsbraut which (once again) turns into the shopping street Laugavegur on route to the centre.

There are several hotels along Suðurlandsbraut so it wouldn’t be hard to commute.

Check Here for Accommodations in Laugardalur

This area is known to be good for families and there are some great attractions here in the east end like the National Football Stadium, Laugardalslaug (a popular public pool with waterslide), Grasagarður Botanical Garden, and more.

Featured Accommodations in Laugardalur

Below are several accommodation options in this region. Eric explored this area by car and can attest to how spread out things are.

This makes it a good area if you have a rental car since accommodations here often have free private parking onsite or ample parking on the streets nearby.

ODDSSON Hotel – Check Now

  • Style: A Trendy and Modern Hotel
  • Price Range: Upper Range
  • Location: Quiet area, a long walk or short bus downtown, food options/shops close by
  • Featured Amenities: Free indoor parking, really nice breakfast included, good Wifi
  • Flybus Shuttle Stop: Airport shuttle pick-up/drop-off directly at hotel

Hótel MúliCheck Now

  • Style: A Bright and Minimalist Hotel
  • Price Range: Mid-Range
  • Location: Right in the bank of hotels close to where Laugavegur Street begins to head downtown
  • Featured Amenities: Free tea/coffee, good Wifi, lots of free parking
  • Flybus Shuttle Stop: Unavailable

Guesthouse Pavi – Check Now

  • Style:  A Simple & No-Frills Hotel
  • Price Range: Budget (actually budget)
  • Location: In a quieter area just outside Laugardalur (close to Hlemmur bus station)
  • Featured Amenities: Private or dorm rooms, some with private bathrooms, Wifi
  • Flybus Shuttle Stop: Bus Stop 13 – Rauðarárstígur close by

Vesturbær – Sea Views & History

colourful houses on shore of lake with birds flying
This is Lake Tjörnin – and this shore is basically on the edge of where Vesturbær starts and the Centre officially ends.

Located just to the west of the city centre, Vesturbær is a sprawling area that includes more residential houses, seaside/marina properties with water views, some of the University of Iceland, and more.

While the area is made up of a few smaller neighbourhoods, most visitors would gravitate towards the “Old West Side” given its proximity to downtown Reykjavik and other top attractions, restaurants, nightlife, etc.

Check Here For Accommodations in Vesturbær

Compared to the centre (like along Laugavegur Street), it tends to be a tad quieter.

The area has a few things to check out such as the Saga Museum, The Maritime Museum, Cathedral of Christ the King, and a popular public pool (Vesturbæjarlaug).

Ísbúð Vesturbæjar is a great ice cream shop to stop by if you stay here!

Featured Accommodations in Vesturbær

Below are several nice accommodations in this area. This is another good area for families, larger groups, or longer stays because it’s close to downtown but not right downtown.

It’s also accessible by car (more so than the downtown core since you bypass the busy parts).

Icelandair Hotel Reykjavik Marina – Check Now

  • Style: A Trendy and Unique Hotel
  • Price Range: Upper Mid-Range
  • Location: Right on the water, a short walk to the city centre
  • Featured Amenities: Bar, good breakfast, gym, fireplace, movie theatre all onsite
  • Flybus Shuttle Stop: Airport shuttle pick-up/drop-off directly at hotel

Grandi by Center Hotels – Check Now

  • Style: A Warm Yet Colourful Boutique Hotel
  • Price Range: Upper Mid-Range
  • Location: Close to the pier for whale watching tours, short walk to city centre
  • Featured Amenities: Nice breakfast, trendy onsite bar/restaurant
  • Flybus Shuttle Stop: Airport shuttle pick-up/drop-off directly at hotel

Lighthouse Apartments – Check Now

  • Style: Homey, Functional Apartments
  • Price Range: Upper Mid-Range
  • Location: Very close to the city centre (but not in it), also close to the ocean
  • Featured Amenities: Free on-street parking close by, fully equipped kitchens, good WIFI
  • Flybus Shuttle Stop: Bus Stop 1 – Ráðhúsið – City Hall close by

Kópavogur – For Strategic Location

If you’re searching for where to stay in Iceland but outside of Reykjavik, check out Kópavogur.

Located to the south of all the above areas, Kópavogur is technically not a neighbourhood of Reykjavik. However, this large, sprawling region is still part of the capital region.

This makes it unique in that it’s sandwiched between the busy parts of the city but also has easy access to the larger roadways/highways.

If you have a car, these highways make it easy to head for the airport, the famous Golden Circle by car, and other parts of Iceland (via the Ring Road).

So, Kópavogur is one of the best places to stay near Reykjavik. This area is a healthy mix of both residential and commercial so it still has shops, grocery stores, and other amenities to offer visitors – like Sundlaugin í Kópavogi (public pool).

Check Here for Accommodations in Kópavogur

The region also technically includes a lovely body of water called Lake Ellidavatn which you can stay near with the right accommodation (see below!).

You can get back to the city centre easily via bus or your rental car.

Since this area is a tad further out from the heart of the city centre (it would be well over an hour to walk), it’s popular with those renting a car during their time in Iceland.

Featured Accommodations in Kópavogur

Below you can find a handful of popular accommodations in this region.

Accommodations here often have ample free parking to accommodate visitors with cars. Of course, check the details of any property to make sure it meets your needs!

201 Hotel – Check Now

  • Style: A Trendy and Stylish Hotel
  • Price Range: Upper Mid-Range
  • Location: A short drive to city centre, restaurant/supermarket close by
  • Featured Amenities: Good breakfast included, free parking, bar and gym onsite
  • Flybus Shuttle Stop: Airport shuttle pick-up/drop-off directly at hotel

Hótel Heiðmörk – Check Now

  • Style: A Simple Yet Reliable Hotel
  • Price Range: Mid-Range
  • Location: Close to Lake Ellidavatn with mountain views, Bonus supermarket and bakery nearby
  • Featured Amenities: Free parking, really nice breakfast
  • Flybus Shuttle Stop: Unavailable

Icelandic Apartments – Check Now

  • Style: A Bright and Cool Aparthotel
  • Price Range: Upper Mid-Range
  • Location: Also close to Lake Ellidavatn with mountain views, Bonus supermarket and bakery nearby
  • Featured Amenities: Kitchenettes for cooking, Netflix on the TVs, free parking
  • Flybus Shuttle Stop: Unavailable

Keflavík International Airport (KEF) – For Catching Flights

plane landing on runway with plane wing and grass in front
KEF airport is a busy hub of activity!

As always, we wanted to be thorough when talking about places to stay in/near Reykjavik. So, we included a brief rundown of places to stay near Keflavík International Airport (KEF) located in Keflavík.

To be clear: The main airport to fly internationally is Keflavík International Airport (KEF). It is not the smaller airport in the city centre – that’s Reykjavik City Airport.

KEF is about 45 minutes by bus from Reykjavik. Here’s a detailed guide on how to travel from Keflavik Airport to Reykjavik and what to expect when you get to the BSI Bus Terminal closer to downtown.

Near the KEF airport, there is a large cluster of hotels and accommodations in smaller towns like Keflavík/Reykjanesbær.

To get to the airport, many hotels offer airport shuttles but the infrastructure for rental car pick-up/drop-off in this area is also well-developed.

Many accommodations are right on the water which allows for nice views. Staying out here is much quieter and will likely make it less stressful if you have to catch an early flight.

There are even a few attractions out here like Stekkjarkot and Viking World.

Check Here For Accommodations in Keflavík

From this area (around the airport), you are quite close to the famous Blue Lagoon – which you can visit if you have a few hours to spare in Iceland!

Featured Accommodations in Keflavík

Below are a handful of different accommodations by style close to Keflavik International Airport.

Iceland made itself a popular destination for European stopover flights. So, there is no shortage of accommodations to choose from.

Hotel Berg by Keflavík Airport – Check Now

  • Style: A Trendy, Modern Hotel
  • Price Range: Upper Range
  • Location: Right on the waterfront in Keflavík, close to shopping, restaurants and airport
  • Featured Amenities: Airport shuttle included, restaurant/breakfast, rooftop pool

Bergás Guesthouse – Check Now

  • Style: A Simple and Clean Guesthouse
  • Price Range: Mid-Range
  • Location: Right in Keflavik, a short walk to restaurants and attractions, short drive to airport
  • Featured Amenities: Free of-street parking, rooms with kitchenettes, easy airport taxi possible

Raven’s Bed – Check Now

  • Style: A Cozy, Cottagey Bed and Breakfast
  • Price Range: Mid-Range
  • Location: Keflavik close to the ocean, 5-10 mins drive to airport (20 mins driving to the Blue Lagoon)
  • Featured Amenities: Great breakfast, free parking


Here are some answers to frequently asked questions about finding a place to stay in Reykjavik:

Where to stay in Reykjavík on a budget?

If you’re heading to Reykjavik on a budget, there are some cheaper hotels or guesthouse-style accommodations that are not as expensive as many of the top hotels.

Check out Guesthouse Pavi walkable to downtown or Hotel Cabin in Laugardalur for great examples of simple yet reliable accommodations in good locations that will not break the bank.

Where to stay in Reykjavík to see the northern lights?

You could theoretically be able to see the Northern Lights from your accommodation in Reykjavik provided you’re visiting between November and February, the light activity is strong, and the area has limited light pollution.

Given that much of central Reykjavik suffers from too much light pollution, the best chance to see the Northern Lights is to go on a Northern Lights Tour outside the city.

Alternatively, you can choose accommodation in an area that is further from the centre and is more residential – therefore having less light pollution.

Accommodations in the more remote areas of Kópavogur like Hótel Heiðmörk or Icelandic Apartments might be good options for this kind of sky viewing.

Blue House B&B much further west of downtown is also far enough away to catch the lights if they are active!

But keep in mind that there’s never a guarantee that you will actually see the Northern lights!

Where to stay in Reykjavík to see the mountains?

If you want to have a chance to see the mountains from your accommodation in Reykjavik, a hotel such as Fosshotel Baron or apartments like Reykjavík Central Apartments are both good options.

These properties are located to the northside of the city’s centre and thus overlook the ocean towards Mount Esja. These properties might also be a good option if you’re wondering where to stay in Reykjavik on a honeymoon.

Eric stayed in KEX Hostel and when you walk out the front door you’re greeted with Mount Esja across the open ocean. Beautiful.

Alternatively, Icelandic Apartments in Kópavogur (a bit outside the centre) offers apartments with lake and mountain views!

Where to stay in Reykjavík when your flight arrives early?

For those with an early flight into Reykjavik looking for early check-in, you’ll be pleased to know that many accommodations offer this.

This is because Iceland is such a busy stopover hub – the expectation around early check-in is well-defined at this point.

Check out Midgardur by Center Hotels which has been known to offer early check-in and/or check-out.

It is also conveniently located right beside Bus Stop #13 Rauðarárstígur which the Airport Shuttle Flybus utilizes.

This means you can connect with the main airport shuttle bus at BSI Bus Terminal with relative ease.

Of course, if you know you have an early flight, inquire directly with any accommodation about check-in times. Rules and regulations are subject to change without notice these days!

Where to stay in Reykjavík for one night?

If you’re staying in Reykjavik for one night, there’s a good chance that you are catching a flight in or out of the country right before or soon thereafter.

Where you stay depends on how comfortable you are distance-wise (and your usual stress level) when getting to and from the airport. So, there are three options here:

  1. Stay close to the airport so you don’t have to stress too much about travel times. Check out Hotel Berg by Keflavík Airport with airport shuttle included or Bergás Guesthouse as great examples of airport accommodations near Keflavik.
  2. Stay in a guesthouse Eric the Red Guesthouse (behind the big church) where you can both easily walk to the city centre and the BSI Bus Terminal to get back to the airport directly in about 45 minutes.
  3. Stay in the heart of the city centre to maximize your time if you only have one day in Reykjavík. Eyja Guldsmeden Hotel, for example, has direct airport shuttle pick-up and Central Guesthouse Reykjavik is centrally located right beside Bus Airport Shuttle Bus Stop #2. Of course, you can always arrange for a private airport transfer or taxi that can zip you back to the airport for an early flight at any time from pretty much anywhere.

Where to stay in Reykjavík without a car?

The best places to stay in Reykjavik without a car would be in or close to the city centre.

Some accommodations have direct pick-up/drop-off with the Flybus shuttles or are very close by to a Flybus bus stop (to connect with the Airport shuttle). Here is the detailed list of Reykjavik accommodations and their relative shuttle stops.

This will allow you to explore all the top sites on foot while still having access to both the local bus system for exploring the outskirts of the capital city and the airport shuttle system.

Check out Midgardur by Center Hotels for a good hotel, Central Guesthouse Reykjavik for a nice guesthouse, and Reykjavik Residence Apartment Hotel for an apartment choice – all in or walkable to the city centre in Miðborg.

And there you have it – a detailed rundown on where to stay in Reykjavik, Iceland.

In the end, there are so many great places to stay that we are confident you’ll find something that works for you. Just remember what is important to you (quiet vs. lively area, walkability, etc.)!

As always, Happy Waddlin’,

Booking Your Trip Soon? This Is How We Do It:
  • Compare flights on Skyscanner
  • Check for Hotel Deals or Book A Hostel
  • Get A Rental Car (depending on the destination)
  • Research plug types and possibly get a travel adapter
  • Go over our packing list
  • Pin it for later!

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