Iceland, a land of fire and ice, is a dream destination for travelers seeking adventure, natural beauty, and cultural richness (Where to stay in Iceland). From its dramatic landscapes of volcanoes, glaciers, and waterfalls to its vibrant cities steeped in history, Iceland offers something for everyone. However, choosing the best places to stay in Iceland can be overwhelming given the country’s vastness and diversity. In this comprehensive guide, we will explore the top destinations and luxurious hotels that cater to every type of traveler, ensuring your Icelandic adventure is as memorable as possible.
Why Choose Iceland for Your Next Getaway?
Before diving into the specifics of where to stay, it’s important to understand why Iceland has become such a sought-after destination. This Nordic island nation boasts some of the most unique landscapes on Earth , including black sand beaches, geothermal hot springs, and the mesmerizing Northern Lights. Whether you’re an avid hiker, a culture enthusiast, or someone simply looking to unwind in nature, Iceland has it all.
Traveling to Iceland also means experiencing its rich Viking heritage, delicious local cuisine, and warm hospitality. The country’s compact size makes it easy to explore multiple regions during your stay, but selecting the right base is crucial to maximizing your experience.
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The Allure of Iceland
Iceland’s appeal lies not only in its breathtaking scenery but also in its ability to offer solitude and tranquility. Unlike bustling European capitals, Iceland provides a sense of remoteness that allows travelers to disconnect from the stresses of daily life. Its small population (just over 370,000 people) ensures that even popular tourist spots rarely feel overcrowded, making it an ideal destination for those who value peace and quiet.
Moreover, Iceland is a year-round destination. Summer visitors are treated to the phenomenon of the Midnight Sun , where daylight stretches late into the evening, allowing for extended exploration. Winter travelers, on the other hand, have the chance to witness the ethereal dance of the Northern Lights , one of nature’s most spectacular displays. Each season brings its own charm, and understanding these nuances will help you decide when and where to stay.
Reykjavik: Iceland’s Vibrant Capital
Why Stay in Reykjavik?
As Iceland’s capital and largest city, Reykjavik serves as the perfect starting point for any trip. It combines modern amenities with a charming small-town vibe, making it ideal for both first-time visitors and seasoned explorers. The city is known for its colorful buildings, thriving arts scene, and proximity to iconic landmarks like the Golden Circle.
Reykjavik is more than just a gateway to Iceland’s natural wonders; it’s a cultural hub brimming with museums, galleries, and live music venues. Walking through the streets of downtown Reykjavik feels like stepping into a living postcard, with vibrant murals adorning walls and quirky boutiques lining Laugavegur Street, the city’s main shopping thoroughfare.
Top Hotels in Reykjavik
- ION Adventure Hotel
Located just outside Reykjavik, this eco-friendly hotel offers stunning views of Mount Hengill and easy access to nearby hiking trails. Its minimalist design and commitment to sustainability make it a favorite among environmentally conscious travelers. The hotel’s restaurant, Silfra, serves innovative dishes crafted from locally sourced ingredients, while the Northern Lights Bar provides panoramic views of the surrounding landscape. - Canopy by Hilton Reykjavik City Centre
Situated in the heart of downtown, this hotel provides luxurious accommodations within walking distance of major attractions like Hallgrímskirkja Church and Harpa Concert Hall. Guests rave about the rooftop bar, which offers panoramic views of the city. Canopy’s emphasis on personalized service extends to its complimentary breakfast bags delivered to your room each morning. - Hotel Borg by Keahotels
A historic landmark, Hotel Borg combines Art Deco elegance with contemporary comfort. Built in 1930, this iconic property has hosted celebrities, politicians, and royalty over the decades. Its central location and Michelin-recommended restaurant ensure a truly unforgettable stay. For history buffs, the hotel’s museum-quality decor adds an extra layer of intrigue. - The Reykjavik EDITION
Known for its chic interiors and exceptional service, this boutique hotel caters to discerning travelers who value style and sophistication. Designed by Ian Schrager, the man behind Studio 54, The Reykjavik EDITION exudes glamour at every turn. Don’t miss their signature cocktail menu at the ground-floor lounge, where mixologists craft drinks inspired by Icelandic folklore. - Alda Hotel Reykjavik
For those seeking affordability without compromising quality, Alda Hotel offers spacious rooms and personalized service. Its proximity to Laugavegur Street—a shopper’s paradise—makes it a convenient choice. Additionally, Alda’s wellness center includes a sauna and steam room, perfect for unwinding after a day of sightseeing.
Things to Do in Reykjavik
- Visit the National Museum of Iceland to learn about the country’s fascinating history, from Viking settlements to modern times.
- Explore the quirky street art and independent boutiques in the Grandi district, a former industrial area transformed into a creative hotspot.
- Relax at the Blue Lagoon Spa , located just 45 minutes from the city center. While technically outside Reykjavik, many visitors choose to visit this world-famous geothermal spa during their stay.
- Enjoy fresh seafood at one of Reykjavik’s many fine dining restaurants, such as Dill or Fish Market, both celebrated for their innovative takes on traditional Icelandic cuisine.
South Coast: Nature’s Masterpiece
Why Stay Along the South Coast?
The South Coast of Iceland is home to some of the country’s most breathtaking natural wonders, including Seljalandsfoss Waterfall , Skógafoss Waterfall , and the famous Jökulsárlón Glacier Lagoon . Staying here allows you to immerse yourself in Iceland’s raw beauty while avoiding the crowds often found in Reykjavik.
This region is particularly popular for road trippers driving the Ring Road, a circular route that encircles the entire island. The South Coast offers a diverse array of experiences, from glacier hikes and ice cave tours to relaxing in geothermal pools. Its accessibility and abundance of attractions make it a top choice for travelers seeking adventure.
Best Accommodations on the South Coast
- Fosshotel Glacier Lagoon
Nestled between Skaftafell National Park and Jökulsárlón Glacier Lagoon, this hotel offers direct access to two of Iceland’s most iconic sites. Floor-to-ceiling windows provide uninterrupted views of the surrounding glaciers, creating a surreal atmosphere that feels almost otherworldly. The hotel’s restaurant specializes in seasonal dishes made from locally sourced ingredients, ensuring a true taste of Iceland. - Hotel Ranga
A luxury countryside retreat, Hotel Ranga is renowned for its stargazing opportunities and Northern Lights viewing platform. Each room is uniquely themed after different continents, adding a touch of whimsy to your stay. The hotel also features a state-of-the-art observatory equipped with telescopes, allowing guests to explore the night sky under expert guidance. - Black Beach Suites
Located near Vik, these private suites offer unparalleled privacy and direct access to Reynisfjara Black Sand Beach. Their sleek Scandinavian design complements the rugged coastal scenery, while floor-to-ceiling windows frame jaw-dropping ocean views. For added convenience, each suite comes with a fully equipped kitchenette. - Hótel Vík í Mýrdal
This family-friendly hotel features cozy rooms and a hearty breakfast buffet. Its location in Vik makes it an excellent hub for exploring nearby attractions like Dyrhólaey Peninsula and Reynisdrangar Sea Stacks. After a day of adventuring, relax in the hotel’s outdoor hot tub while taking in the majestic views of the Atlantic Ocean. - Stracta Hótel Hella
Ideal for budget-conscious travelers, Stracta Hótel Hella provides comfortable accommodations and friendly service. It’s also conveniently located along the Ring Road, making day trips effortless. The hotel’s restaurant serves up hearty portions of traditional Icelandic fare, including lamb stew and fish soup.
Activities Along the South Coast
- Embark on a guided glacier hike or ice cave tour in Vatnajökull National Park, Europe’s largest national park.
- Take a dip in the Secret Lagoon , a hidden gem surrounded by geothermal pools and steam vents.
- Photograph the majestic Eyjafjallajökull Volcano , infamous for disrupting air travel in 2010. Guided tours take you close enough to appreciate its imposing presence.
- Spot puffins and other seabirds at Dyrhólaey Cliffs, a haven for wildlife enthusiasts.
North Iceland: Untamed Wilderness
Why Visit North Iceland?
While much of Iceland’s tourism focuses on the south, North Iceland remains relatively untouched and brimming with natural wonders. Highlights include Lake Mývatn , Goðafoss Waterfall , and the vibrant city of Akureyri. Often referred to as the “Capital of the North,” Akureyri offers a blend of urban sophistication and rural charm.
North Iceland is particularly appealing to travelers seeking solitude and off-the-beaten-path adventures. Its remote location ensures fewer tourists, allowing you to connect deeply with the land and its people. Whether you’re marveling at cascading waterfalls or soaking in geothermal baths, North Iceland promises an authentic Icelandic experience.
Top Hotels in North Iceland
- ION Luxury Adventure Hotel
Perched atop a lava field, this award-winning hotel blends seamlessly into its surroundings. Guests can enjoy gourmet meals prepared using locally sourced ingredients, paired with panoramic views of the surrounding wilderness. The hotel’s spa facilities, including a heated pool and sauna, provide the ultimate relaxation after a day of exploration. - Hotel Laxá
Situated near Lake Mývatn, Hotel Laxá offers rustic charm and warm hospitality. Its outdoor hot tubs are perfect for unwinding after a day of hiking or birdwatching. Inside, the cozy interiors feature wooden accents and plush furnishings, creating a welcoming ambiance. - Akureyri Backpackers
A great option for solo travelers and backpackers, this hostel fosters a sense of community through communal kitchens and organized activities. Despite its budget-friendly rates, Akureyri Backpackers doesn’t skimp on comfort, offering clean rooms and friendly staff. - Hótel Kea
Located in the heart of Akureyri, Hótel Kea combines classic elegance with modern conveniences. Its central location makes it easy to explore the city’s museums, botanical gardens, and shopping districts. The hotel’s restaurant, Ytterhorn, serves up delicious Icelandic dishes with a focus on freshness and flavor. - Fosshótel Husavik
Known as the whale-watching capital of Iceland, Husavik is home to this charming hotel overlooking Skjálfandi Bay. Whale-watching tours depart daily from the nearby harbor, giving you the chance to spot minke whales, humpbacks, and even blue whales. Back at the hotel, enjoy stunning sea views from your room or indulge in a meal at the on-site restaurant.
Must-Do Experiences in North Iceland
- Soak in the Mývatn Nature Baths , a quieter alternative to the Blue Lagoon. These geothermal pools are nestled amidst volcanic landscapes, providing a serene setting for relaxation.
- Go horseback riding through the scenic countryside, where you’ll encounter wildflowers, rivers, and towering peaks.
- Marvel at the cascading waters of Dettifoss Waterfall , Europe’s most powerful waterfall. Standing at the edge of the canyon, you’ll feel the sheer force of nature reverberate through your body.
- Sample craft beer at Akureyri’s microbreweries, which have gained recognition for their innovative brews and commitment to quality.
Westfjords: Off-the-Beaten-Path Adventure
Why Choose the Westfjords?
For travelers seeking solitude and unspoiled wilderness, the Westfjords region is a hidden treasure. With jagged cliffs, remote villages, and abundant wildlife, this area feels worlds away from the hustle and bustle of Reykjavik. It’s a place where time slows down, and nature takes center stage.
Despite its isolation, the Westfjords boast incredible infrastructure for tourism, with well-maintained roads and welcoming accommodations. Whether you’re hiking along cliffside trails or photographing puffins perched on rocky outcrops, the Westfjords promise an unforgettable journey.
Recommended Stays in the Westfjords
- Ketildalir Guesthouse
This cozy guesthouse offers simple yet comfortable accommodations amidst breathtaking fjord views. Hosts are incredibly welcoming and eager to share local insights, ensuring you make the most of your stay. Breakfast is included, featuring homemade bread and jams. - Heydalur Country Hotel
Surrounded by mountains and rivers, Heydalur is a haven for outdoor enthusiasts. Activities range from fishing and kayaking to relaxing in natural hot springs. The hotel’s farm-to-table philosophy ensures that every meal is fresh and flavorful. - Hotel Djúpavík
Once a herring factory, this historic hotel exudes old-world charm. Its isolation adds to its allure, providing guests with a true escape from modern life. Rooms are decorated with vintage furniture, evoking a sense of nostalgia. - Tungulending Guesthouse
Overlooking the ocean, Tungulending offers self-catering cottages equipped with everything you need for a peaceful retreat. Large windows allow natural light to flood in, while private terraces provide uninterrupted views of the fjords. - Hótel Flókalundur
Conveniently located along the Ring Road, this hotel serves as a convenient stopover for road trippers. Its restaurant specializes in traditional Icelandic dishes, including smoked lamb and fresh seafood. After dinner, relax in the hotel’s lounge area, where board games and books are available for entertainment.
Highlights of the Westfjords
- Hike to Dynjandi Waterfall , a multi-tiered cascade that resembles a bridal veil. The trail leading to the falls winds through lush valleys and offers stunning vistas along the way.
- Spot seals lounging on the shores of Látrabjarg Cliffs , Europe’s westernmost point. These towering cliffs are also home to thousands of seabirds, including puffins, guillemots, and razorbills.
- Explore the eerie beauty of Rauðasandur Beach , known for its red sands and tranquil atmosphere. Unlike Iceland’s more famous black sand beaches, Rauðasandur offers a unique contrast against the surrounding green hills.
- Visit the Arctic Fox Centre in Súðavík to learn about Iceland’s only native mammal. This educational facility houses rescued foxes and educates visitors about conservation efforts.
Eastfjords: Serenity and Scenic Beauty
Why Stay in the Eastfjords?
The Eastfjords are characterized by tranquil fishing villages, towering peaks, and serene fjords. This region is perfect for travelers who appreciate slow-paced living and authentic cultural experiences. Unlike the busier parts of Iceland, the Eastfjords remain largely undiscovered, offering a sense of exclusivity and intimacy.
Each village in the Eastfjords has its own distinct character, from Seyðisfjörður’s artistic vibe to Eskifjörður’s maritime heritage. Exploring these communities gives you a deeper understanding of Icelandic life beyond the typical tourist trail.
Best Hotels in the Eastfjords
- Hótel Aldan
Housed in a restored 19th-century building, Hótel Aldan oozes historical charm. Its restaurant serves up delicious seafood dishes made from freshly caught ingredients, while the cozy bar invites guests to linger over cocktails and conversation. - Guesthouse Gerdi
Run by a local family, Guesthouse Gerdi offers affordable rates and a homely atmosphere. Breakfast includes homemade bread and jams, while the communal lounge encourages socializing and sharing stories. - Bláfell Guesthouse
Surrounded by lush greenery, Bláfell provides a peaceful setting for relaxation. Rooms come with private balconies overlooking the fjords, allowing you to soak in the breathtaking scenery from the comfort of your room. - Hótel Framnes
Located in Neskaupstaður, this hotel is a favorite among artists and creatives. Its gallery showcases works by local painters and sculptors, while the on-site café serves up delicious coffee and pastries. - Vestrandarstofa Guesthouse
This quaint guesthouse is ideal for couples and solo travelers. Its communal lounge encourages socializing and sharing stories, while the hosts go above and beyond to ensure a pleasant stay.
Top Things to Do in the Eastfjords
- Drive along the winding roads of the Eastfjords for jaw-dropping vistas. Pull over at designated viewpoints to capture photos of the dramatic coastline.
- Visit Petra’s Stone Collection in Stöðvarfjörður, a museum dedicated to mineral specimens collected by a local woman over several decades.
- Try reindeer spotting in the wild during winter months. These majestic creatures roam freely in the highlands, offering a rare glimpse into Iceland’s untamed wilderness.
- Attend the annual LungA Arts Festival in Seyðisfjörður, a celebration of creativity and community. Workshops, exhibitions, and performances bring together locals and visitors alike.
Golden Circle: Iconic Route, Luxurious Stays
Why Base Yourself Near the Golden Circle?
The Golden Circle route encompasses three must-see attractions: Þingvellir National Park , Geysir Geothermal Area , and Gullfoss Waterfall . Staying nearby ensures ample time to explore these marvels without rushing. Additionally, the region’s proximity to Reykjavik makes it a convenient choice for short getaways.
The Golden Circle is a testament to Iceland’s geological wonders, showcasing the dynamic forces that shaped the island millions of years ago. From tectonic plate boundaries to erupting geysers, this route offers endless opportunities for discovery.
Luxury Hotels Near the Golden Circle
- ION Adventure Hotel
Already mentioned earlier, this property deserves another nod due to its strategic location near the Golden Circle. Its eco-friendly initiatives and luxurious amenities make it a standout choice for discerning travelers. - Hotel Grimsborgir
Offering elegant cottages with private hot tubs, Hotel Grimsborgir is perfect for couples and families alike. The hotel’s restaurant serves up gourmet meals inspired by Icelandic traditions, while the spa facilities provide the ultimate relaxation. - Hotel Borealis
This newly opened hotel boasts state-of-the-art facilities and panoramic views of the surrounding countryside. Its modern design incorporates elements of Icelandic architecture, creating a harmonious blend of form and function. - Fosshotel Hekla
Named after the nearby volcano, Fosshotel Hekla provides stylish accommodations and easy access to hiking trails. Its restaurant focuses on seasonal ingredients, ensuring a farm-to-table dining experience. - Efstidalur Farm Hotel
A working dairy farm turned hotel, Efstidalur offers a unique glimpse into rural Icelandic life. Be sure to try their homemade ice cream, which has earned rave reviews from guests around the world.
Golden Circle Attractions
- Snorkel or dive between tectonic plates at Silfra Rift in Þingvellir. This UNESCO World Heritage Site marks the boundary between the North American and Eurasian plates, offering a once-in-a-lifetime opportunity to swim in crystal-clear waters.
- Watch Strokkur geyser erupt every few minutes, shooting boiling water high into the air. This natural spectacle never fails to impress, drawing crowds throughout the day.
- Capture Instagram-worthy photos at Gullfoss’ thundering falls, where glacial meltwater plunges into a deep canyon below. On sunny days, rainbows often form in the mist, adding to the magic.
Travel Tips for Visiting Iceland
- Pack Layers: Weather in Iceland can change rapidly, so dress accordingly. Waterproof jackets, thermal layers, and sturdy boots are essential.
- Book Early: Popular hotels fill up quickly, especially during peak seasons (June-August). Securing reservations in advance ensures availability and better rates.
- Rent a Car: Public transportation is limited; having your own vehicle gives you freedom to explore at your own pace. Consider renting a 4×4 if planning to venture off the beaten path.
- Respect Nature: Follow Leave No Trace principles and stay on marked paths. Iceland’s fragile ecosystems rely on responsible tourism practices.
- Try Local Cuisine: Don’t miss out on lamb stew, skyr yogurt, and fresh fish. Many restaurants pride themselves on using locally sourced ingredients, supporting sustainable agriculture.
Other Tourist Attractions Worth Exploring
- Snæfellsnes Peninsula: Often called “Iceland in Miniature” due to its diverse landscapes, this peninsula offers everything from black sand beaches to snow-capped volcanoes.
- Landmannalaugar: A hiker’s paradise featuring colorful rhyolite mountains, hot springs, and challenging trails.
- Askja Caldera: A remote volcanic crater lake accessible via 4×4 vehicles. The journey itself is part of the adventure, taking you through desolate lava fields and rugged terrain.
- Vatnajökull Glacier: Europe’s largest glacier offers endless opportunities for adventure, including glacier hikes, ice climbing, and ice cave tours.
Conclusion
Choosing the best places to stay in Iceland depends largely on your interests and travel style. Whether you prefer the cosmopolitan energy of Reykjavik, the untamed wilderness of the Westfjords, or the serene beauty of the Eastfjords, there’s no shortage of incredible options. By staying at one of the recommended hotels listed above, you’ll not only enjoy world-class accommodations but also gain easy access to Iceland’s most awe-inspiring sights.
From chasing waterfalls and exploring glaciers to indulging in local delicacies and soaking in geothermal pools, Iceland promises an unforgettable journey filled with wonder and discovery. Plan your trip wisely, embrace the unexpected, and let the Land of Fire and Ice leave an indelible mark on your soul.
FAQs About Where to Stay in Iceland
- What is the best time to visit Iceland?
Summer (June-August) offers long daylight hours, while winter (November-March) is ideal for seeing the Northern Lights. - Is it safe to drive in Iceland?
Yes, but always check road conditions and stick to paved roads unless you have a 4×4 vehicle. - Are there budget-friendly accommodations in Iceland?
Yes, hostels, guesthouses, and camping sites provide affordable alternatives. - Do I need to book accommodations in advance?
Absolutely, especially during peak tourist seasons. - Which part of Iceland is best for families?
Reykjavik and the South Coast are highly recommended for family-friendly activities. - Can I see the Northern Lights from my hotel?
Many rural hotels offer Northern Lights wake-up calls if sightings occur overnight. - How far apart are major attractions in Iceland?
Distances vary, but driving times typically range from 2-6 hours between key locations. - Are credit cards widely accepted in Iceland?
Yes, cash is rarely needed as most businesses accept cards. - What should I pack for an Iceland trip?
Waterproof clothing, sturdy shoes, sunglasses, and a camera are essentials. - Are there vegetarian/vegan options in Icelandic restaurants?
Most restaurants cater to dietary restrictions, offering plant-based dishes.