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Despite Iceland’s famous financial collapse in 2008, and the many ultra-cheap flights available for getting to the country, prices in Iceland are still high compared to many other places around the world. For example, a beer in a bar will set you back about $8-10, a 12-inch pizza costs around $16, and in more upscale restaurants, you’ll have a hard time finding entrees for less than $40.
Those higher costs carry over to the accommodation too. Airbnbs start at $70-$100 for studio or one-bedroom apartments, and even bunk bed dorm lodging costs a minimum of $30-40 per night.
If you’re looking for something nicer and more private, the prices just keep rising, particularly during peak summer months when prices can be double the winter rate. The good news is that many hotels and guest houses offer perks like free breakfasts and kitchenettes to help offset some of the cost of dining.
Below are some of the best budget hotel options in Reykjavik.
Kex Hostel
For a livelier stay, Kex Hostel is a perfect choice. Located in a former biscuit factory downtown, the hostel is known for its trendy cafe and bar which often hosts live music performances from local and international musicians. The cheapest double rooms have shared bathrooms, but rooms with private baths are available, as are dorm accommodations. There’s an outdoor patio, gym, laundry room, common room, and guest kitchen. Wifi is free and bikes are available to rent.
Double rooms with shared bathrooms start at $100 in winter and $200 in summer.
Icelandair Hotel Reykjavik Marina
With an ideal location in Reykjavik’s downtown harbor, the nautical-themed Icelandair Hotel Reykjavik Marina is a chic hotel with quirky design (think: humorous phrases in the rooms, folk art sculptures from Icelandic artist Adalheidur S. Eysteinsdottir in the lobby) and an excellent onsite bar and restaurant, Slippbarinn. Rooms are spacious and continue the offbeat nautical theme fishing nets and maps decorating the walls and all the basics: flat screen TV, free wifi, and mini-fridges.
Room rates start at $160 per night in winter and rise to $220 in summer.
Guesthouse Sunna
Located just steps from Hallgrimskirkja Church in the city center, Guesthouse Sunna is another great value. Though the cheapest rooms are pretty stripped-down (don’t expect more than a bed, desk, a few shelves and a nightstand) there’s free wifi and free parking and the shared bathrooms are only used by two or three rooms. Each floor also has a small shared kitchenette with microwave, mini fridge, and two stovetop burners. Breakfast is served each morning and includes eggs, toast, fruit, cheese, meat, coffee and juice, so you can fill up before heading out for the day.
Winter rates are $100 for a double room while summer rates jump to $180 per night. Rooms with private bath, as well as studios and apartments, are also available at a higher rate.
Loft Hostel
Part hostel, part hotel, Loft offers basic but cozy rooms, a self-catering kitchen, cafe and communal space, and an excellent location in the heart of downtown. On the hotel side, double rooms have private bathrooms, floor-to-ceiling windows, and comfy beds. If a hotel is more your speed, there’s no forced interaction, but if you like the hostel vibe, you can meet people in the cafe, join a tour, or check out the calendar of daily activities.
Double room rates start at around $140 in winter and go up to $200 per night in summer.
Room with a View
Room with a View is ideal for those who want a bit more privacy and luxury (and don’t mind paying for it). The stylish apartments offer TVs, hairdryers, irons, free wifi, access to common Jacuzzis and a sauna, and all have private bathrooms and kitchenettes. Each one has a great view of the city center and some have apartments even have dining rooms and Jacuzzi tubs. The apartments range in size to accommodate anywhere from two to ten people, but the smaller apartments are the most affordable.
One-bedroom apartments that sleep two people start at $120 per night in the winter and $180 in the summer. Check rates on Expedia.
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