Where to Stay in Reykjavik, Iceland | 15 Best Hotels + Top Tips

Shaped by extremes, with an untamed wilderness and natural beauty almost too breathtaking to describe, Iceland is like no other place. It shouldn’t come as a surprise that its capital city, Reykjavik, is also a unique showcase you have to see to believe.

Brightly colored houses tiered along a glistening shoreline, vibrant cafes and bars breathing life into city streets, or fireworks slicing the skyline above the ziggurat at Hallgrímskirkja — Reykjavik is offbeat, bohemian, and entertaining.

It’s the kind of place that makes you want to explore and experience as much as possible, and thanks to its relatively compact size, that’s easy to do. But deciding where to stay in a city as diverse as Reykjavik is a little more challenging, but not impossible.

So, come along, fellow traveler. Let’s delve into this fantastic city and find your next Icelandic home away from home.

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It’s Time to Find Reykjavik’s Best Places to Stay

There’s a lot of fun to be had in walking around and exploring the captivating city of Reykjavik, and it rewards those who do handsomely. This is very much thanks to its distinct city landscapes, where every area has a personality all its own.

Choosing your favorite comes down to personal preference, and where better to express your unique travel style than in Reykjavik? Keep reading for a breakdown of the best Reykjavik hotels and the top areas to choose from.

Hotels With the Best Views

There are countless places in Iceland where you’re guaranteed unmatched and enchanting views, no matter what you’re looking at. This is equally true for Reykjavik, and it’s not hard to understand why when looking out on its kaleidoscopic cityscape. 

Perched on the sea, Reykjavik is a visual feast. Its skyline is dazzling no matter the time of day, from the Harpa Concert Hall to the old harbor. Now, there are excellent hotels throughout the city, but these are a few that benefit from having beyond-incredible views.  

Luxury | Tower Suites Reykjavik

Kicking things off with what can only be called a showstopper, the Tower Suites Reykjavik hardly needs any introduction. Only being beaten in height by Hallgrímskirkja, the property dominates the 20th floor of the Höfðatorg Tower.

Easily one of the best hotels in Reykjavik, if not one of the best in Iceland, the Tower Suites takes full advantage of its perch high above the city’s low-lying skyline. Each strikingly designed suite with floor-to-ceiling windows showcases unbelievable panoramic views.

The hotel offers only eight suites, creating an intimate atmosphere. Styling and amenities dictate a more thoughtful, penthouse luxury vibe. Corner suites come with in-room telescopes for even more incredible sightseeing. >>>Check Availability

Mid-Range | Fosshotel Reykjavík

Opened in 2015, the Fosshotel Reykjavik is the country’s largest and one of its most luxurious hotels. Situated in the city’s business district, it delivers a chic, upscale experience you usually only find in smaller properties. 

Over 16 floors are 320 rooms that showcase plenty of natural light with striking views of the city and sea. The deluxe rooms and seven suites on the upper floors show off the most spectacular of the hotel’s vistas.

As for what awaits inside the stunning four-star space, expect warm and modern interiors, with guestrooms featuring plush beds, sizeable bathrooms, and high-end complimentary cosmetics. Your tastebuds will enjoy the lavish menu at the on-site restaurant Haust. >>>Check Availability

Budget | Center Hotels Arnarhvoll

Grabbing a room with a view doesn’t necessarily mean breaking the bank, but in a city like Reykjavik, you mostly get what you pay for. Luckily, the Center Hotels Arnarhvoll does the trick of delivering outstanding scenery at a budget-friendly price.

Setting the Center Hotels Arnarhvoll apart is its enviable location that promises mesmerizing sea and city views. In such a walkable city, this standout enjoys an ideally central location, with Reykjavik’s main shopping street, Laugavegur, right around the corner.

Interiors are warm and showcase classic Nordic decor framed by a minimalist design, visible throughout its 104 cozy rooms. Although rooms are on the smaller side, they’re very comfy, and the views are to die for, with some looking out onto the Harpa concert hall. >>>Check Availability

Too much free time? Here’s a breakdown of the most incredible things to do in Iceland in winter.

Where to Stay for The Northern Lights

While Iceland has natural scenery galore, its star attraction is the Aurora Borealis (or the Northern Lights). For many visitors, seeing the dazzling overhead display is a top priority, and going the extra mile is a no-brainer.

That often means heading out into the country’s wilderness to find the ideal spot to catch sightings of the phenomenon. But that’s not always the case, and some of Reykjavik’s highest-rated hotels also offer ample space to see the captivating Northern Lights.

Luxury | The Reykjavik Edition

A five-star property that has brought refinement, modern luxury, and superb service to Downtown Reykjavik, the Reykjavik Edition outdoes most other hotels. Perched on a harbor-side locale, views include Mt. Esja and the Snæfellsjökull glacier.

Exteriors mimic Iceland’s iconic lava landscapes, with interiors that immediately welcome you home with an expansive digital artwork of the Northern Lights at reception. On offer are 253 tastefully decorated rooms and suites, all with floor-to-ceiling windows.

Gazing out over the old harbor, you’re guaranteed unmatched views no matter which room you choose. Adding to its reputation as one of the most popular hotels, on-site, you’ll find Tides, a Micehlin-star helmed restaurant, and a lively bar. >>>Check Availability

Mid-Range | ION City Hotel

The second property of the owners of the ION Adventure Hotel, the ION City Hotel, is situated in Downtown Reykjavik. It is reminiscent of its sibling but stands out in its own way, although Northern Lights views are guaranteed at both.

With dozens of shops, cafes, bars, and eateries surrounding the property, the area has an air of vibrancy that makes a stay worthwhile. Inside, this atmosphere continues with bursts of luxury touches and designer creations by local artists.

The ION showcases several room categories, from standard guestrooms to more extensive suites and luxury apartments. No matter which you choose, standard amenities include Nespresso coffee machines and B&O Bluetooth entertainment systems. >>>Check Availability

Budget | Hótel Reykjavik Grand

One of the best budget hotels in Reykjavik, the Hótel Reykjavik Grand towers above the city’s landscape. It is a glassy, glossy, and gorgeous four-star property that meets expectations without costing a fortune.

Although outside the downtown area, the Hótel Grand is ideally located in central Reykjavik. Most city-centre sights are a few minutes away. The property’s more than 300 private rooms are spacious, comfortable, and blessed with stunning views.

Of course, for the most rave-worthy vistas, the higher-level suites beat any competition, while all rooms come with standard amenities. On-site dining happens at the Brasserie Grand restaurant, which focuses on Nordic and international cuisine. >>>Check Availability

Accommodation for Families

As amazing as solo travel is, experiencing the magic of Reykjavik is made extra special when done with your family. Considering how diverse and energetic the city is, it shouldn’t surprise you that the city’s attractions always offer something fun for the whole family to do.

With various luxury hotels, boutique properties, and budget options, Reykjavik does a fantastic job catering to families of any size. Several areas do this better than others, particularly Laugardalur and Downtown, which tick every box for the best places to stay in Reykjavik.

Luxury | Black Pearl

The Black Pearl has raised the bar for apartment accommodation in Reykjavik, making it an uber-luxurious choice for families visiting the city. It boasts a convenient location that’s central without the hustle and bustle of the city center.

Nestled perfectly into its harbor surroundings, several of the city’s landmarks are nearby, such as the Harpa concert hall, the Reykjavik Art Museum, and Hallgrímskirkja. Should you and your family want to spend time indoors, the Black Pearl also doesn’t disappoint.

Consisting of 17 suites, including an opulent penthouse and presidential suite, each apartment has elegant, modern, and comforting styling and design. No matter your choice, expect to find fully equipped kitchens, private bathrooms, and blackout curtains. >>>Check Availability

Mid-Range | Reykjavik Residence Apartment Hotel

Occupying two separate locations in the downtown area, the Reykjavik Residence Apartment Hotel promotes itself as a home away from home. Does it deliver? It does indeed, thanks to welcoming interiors, prime central location, and friendly service.

Set within fully renovated historic homes, the Residence Hotel’s apartments are modern and luxurious while still genuinely feeling like a cozy home. Picture tasteful wooden floors, artful photos on the wall, and chic but comfortable furnishings.

Several accommodation categories are available, ranging from studios, superior studios, and junior suites to one-, two-, and three-bedroom apartments. Bigger families should opt for larger suites with full kitchens, dining areas, and living spaces. >>>Check Availability

Budget | Sand Hotel

Although not always the most budget-friendly big city, Reykjavik does have some standout wallet-conscious options perfect for families. Taking first place, though, is Sand Hotel, perched on a quiet nook of the city’s shopping street, Laugavegur.

Mirroring the subdued side of Icelandic culture, the hotel’s entrance, a small, barely marked door, does a great job of hiding what waits inside. Interiors are a creative mashup of Nordic with American undertones.

Fifty-two modern rooms are available, each showcasing thoughtful design, styling, and amenities galore. You’ll find Nespresso coffee machines and Marshall entertainment systems regardless of your room choice. Interconnecting rooms are available. >>>Check Availability

Stay Near the Airport

A super early or late flight often means finding accommodation near the airport. This is true no matter which city you’re in, and the same goes for Reykjavik’s international airport, which is located in Keflavik.

Rest assured, there are plenty of Reykjavik accommodation options that make catching an early or late flight less stressful. These lodgings offer very good value and deliver creature comforts perfect for an overnight stay.

Luxury | Hotel Keflavik

Located five minutes from Keflavik Airport, the four-star Hotel Keflavik manages to tick every box you could have for the best place to stay near Reykjavik. Officially, the hotel is situated in the town of Keflavik on the Reykjanes Peninsula.

Set within a modern, three-story building, the hotel features contemporary styling with subtle Nordic nods throughout. Inside are 70 spacious rooms, each with Bang & Olufsen TVs, workstations, and a coffee maker. 

Depending on your room choice, you can expect to have access to a minibar, an expansive private bathroom, and whirlpool tubs and iPads in the deluxe suites. On-site, you’ll also find a lavishly decorated gourmet restaurant and easy access to airport transfers. >>>Check Availability

Mid-Range | Aurora Hotel

Most visitors would agree that you simply can’t beat staying as close to Reykjavik airport as possible should you need to. Few other Reykjavik hotels come close to the Aurora Hotel, located 300 feet from the airport.

While many hotels boast a very good location, there’s no beating a literal three-minute walk across a car park. Exteriors are modern, directly translating into the same design refinement level inside.

At the Aurora Hotel, you can choose from 72 rooms split between single, double, triple, and family rooms. Each room has a private bathroom and seating area; while not lavishly decorated, they are atmospheric and inviting. >>>Check Availability

Budget | Hotel Jazz

Perfectly bringing together the intimacy and personal service of a B&B with three-star hotel amenities, the Hotel Jazz is a grand choice for overnight stays near the airport. The hotel is situated in the town center, a 10-minute drive from Keflavik Airport. 

The property is owned by a local and is housed within the former Keflavik music school. Its interiors are modern, warmly decorated, and pleasantly furnished. Add to these the excellent staff service, and you’re set up for a great night.

Expect to find sizable rooms, which are clean and comfortable and range in category from singles to doubles, all with queen-sized beds. Amenities include TVs and minibars, and some have sea views. There’s also free parking and free airport shuttles. >>>Check Availability

Downtown Reykjavik (Miðborg)

Whether you’re visiting Reykjavik for the first time or exploring it for the tenth time, the downtown area is the heart of the city. Home to many of the capital’s attractions, a vibrant nightlife scene, and a selection of the best luxury hotels in Reykjavik, Iceland, you can’t go wrong.

The neighborhood’s colorful houses, charming streets, and lively bars welcome solo travelers and families with many accommodation options. As a bonus, most of the city’s other iconic landmarks, not located downtown, are within walking distance.

Luxury | Kvosin Downtown Hotel

Set within the bones of a historic building that dates back to the 19th century, the Kvosin Downtown Hotel is small and ridiculously charming. It’s a beautiful hotel with personality, a boutique property that benefits from a fabulous location.

Interiors present an upbeat Scandinavian atmosphere thanks to minimal, modernist furnishings. These touches are especially evident in the specially commissioned, documentary-style photos of local life.

The 24 boutique apartments are divided into categories like Big, Bigger, and Biggest. Each is equipped with Nespresso coffee machines, Sóley Organics toiletries, and kitchenettes. The Bergsson Mathús restaurant and Klaustur Bar are on the ground floor. >>>Check Availability

Mid-Range | Radisson Blu 1919 Hotel

As far as Reykjavik hotels go, you’re definitely spoilt for choice, especially within its downtown region. Quickly ranking among the best hotels in Reykjavik, Iceland, the Radisson Blu 1919 is a wonderfully luxurious mid-range option.

Situated right in the middle of the Reykjavik city center, outside of the hotel, a mile’s worth of cultural and tourist attractions await. These include the Icelandic House of Parliament, Austurvöllur Square, and the electric shopping street of Laugavegur.

Eighty-eight rooms and suites, divided into several categories, are on offer. Though they vary in size and shape, each is thoughtfully decorated and ridiculously comfy. The 1919 Restaurant serves seasonal dishes with locally sourced ingredients. >>>Check Availability

Budget | Thingholt by Center Hotels

Perched on a quiet side street not far from Laugavegur’s main shopping thoroughfare, Thingholt by Center Hotels is centrally located and close to every city icon. Although one of six Center Hotels properties, it outshines its siblings with striking design and attentive service.

Occupying a former 1940s printing factory, Thingholt’s interior design is playful and chic, with clear modernist influences throughout. The downstairs spa area is a star attraction, complete with a steam room, sauna, and hot tub. 

Of the 52 rooms available, you can choose between standard, deluxe, junior suites, and loft suites. Each is decorated with a slick and refined style palette, and amenities include minibars and complimentary bathrobes. >>>Check Availability

Planning Your Icelandic Adventure: Top Travel Tips

Making the most of your stay in Reykjavik does mean much more than simply choosing the best hotels. Here are some valuable travel tips to ensure your trip is beyond memorable:

• One of the most valuable tips is to book everything as far in advance as possible, especially accommodation, tours, and multi-day tours. You’ll often find the best hotels in Reykjavik fully booked weeks ahead of time.

• The weather in Iceland is almost impossible to predict consistently, so it’s best to come prepared. Make sure that your packing list is season-conscious. Check out this guide on what to wear in Iceland.

• Keeping an eye on weather alerts and road closures is always a great idea in Iceland. Regardless of where you’re heading, from the Golden Circle to the Blue Lagoon and Reykjavik itself, the weather can have chaotic effects on Icelandic roads.

• Depending on what you’re planning for your trip, it’s wise to know when to rent a 4WD or 4×4. Winters in the country are ideal for such vehicles simply because of the weather, but during summer, you’ll need a 4×4 to visit spots like the lighthouses of Snaefellsnes Peninsula or the cliffs of Reykjanes Peninsula.

• Although Reykjavik is a standout when it comes to star quality, a lot of Iceland’s best-kept secrets are nearby. Setting aside some time for a day trip to areas like the Reykjanes Peninsula or the Westfjords is highly recommended.

FAQs About Where to Stay in Reykjavik

Knowing where to stay in Reykjavik is a massive accomplishment, but there might still be some questions that need answers. Below are answers to popular questions.

What Is the Best Area of Reykjavik to Stay in?

While this does come down to personal preference, some areas of the city are better suited to most visitors. For many, staying within the downtown area of Reykjavik is best, and lodgings near the shopping street of Laugavegur are always in high demand. 

Where Do Most People Stay in Iceland?

Unsurprisingly, the best place to stay in Iceland, which most out-of-towners choose, is the capital city of Reykjavik. Alongside thousands of tourists that use the city as a base for exploring the country, it’s also where nearly 60% of Iceland’s locals live.

How Many Days Should You Stay in Reykjavik?

Keep in mind that Reykjavik is the capital of Iceland, the heartbeat of the country, and there’s a lot to take in. Luckily, it’s a walkable city, and most attractions are within walking distance. You should set aside three days minimum to see and do as much as possible.

What is the Best Street in Reykjavik?

By now, you shouldn’t be a stranger to the name Laugavegur. As mentioned earlier, this is the city’s main shopping avenue, where you’ll find dozens of retailers, boutique stores, restaurants, and attractions. The street also leads to the Icelandic capital’s historic city center, which definitely requires a few Insta-worthy snapshots.

The Best Places to Stay in Reykjavik | Wrapping it Up

And that’s where you should stay in Reykjavik! Finding your dream getaway spot in a city as alive and exciting as this isn’t impossible; it’s a lot of fun. Whether you’re after some captivating views, exploring the city with your family, or living it up in its energetic downtown, Reykjavik has something for everyone.

All that’s left for you to do is find your favorite. Reykjavik calls. Will you answer?

Read next: Tips on renting a campervan in Iceland.

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