REYKJAVIK HOTELS ON A MODEST BUDGET
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Discover Reykjavik hotels on a modest budget with this guide. Explore affordable stays, where to dine on a budget, and top picks for activities in Reykjavik.
Most of the hotels are simple, no frills, providing best value for money - even in peak season (June-August).
I have another post which highlight hotels with geothermal pools and hot tubs (all budgets), as well as the lowdown on some useful Icelandic words to learn and the apps/websites to download.
THINGS TO SEE IN REYKJAVIK
There are many activities to enjoy in and around Reykjavik, along with numerous day or week-long tours that leave from the city.
Here are my top picks.
Hot Springs:
Sky Lagoon: The Sky Lagoon is an adults only hot spring and is a more peaceful & relaxing experience. Sky Lagoon has a 7-step ritual that for most is deemed a splurge that is worth it. Sky Lagoon has a waterfront location giving you spectacular views over the ocean.
Top tip: Sunset slots do tend to book out fast.
Hvammsvik Hot Springs: Hvammsvik Hot Springs is about a 50minute drive from Reykjavik, but it's well worth the drive to visit this lesser-known gem. These are natural hot springs that are ocean front, some which change in temperature due to the tide of the ocean. There is accommodation available which includes access to private hot springs. I have written more about it on my Best Hotels In Iceland With Geothermal Pools And Hot Tubs (All Budgets) post.
Blue Lagoon: The Blue Lagoon is an experience that if you love hot springs is one to check out. They do limit how many visitors, so if you go in peak season I would book this one early.
Top tip: If your budget allows splurge for the premium ticket which includes mud mask and a drink from the bar among other things.
Don't forget to also condition your hair and leave it in before entering. The water will dry out your hair and make it brittle.
In Reykjavik City Center:
Flyover Iceland: A fully immersive flight simulator experience showcasing the beauty of the Icelandic landscape. Top tip: if you get motion sickness or don't fair well on rollercoasters maybe give this one a miss.
Guided Foodie Walking Tour: Always a great way to sample the local cuisine in carefully picked out venues chosen by a local guide. Below is a highly recommended food walking tour you can join. Book this one early as its popular and likely to sell out.
Perlan:
An interactive nature museum in Reykjavik with its own 100m indoor real ice cave, aurora northern lights planetarium and a 360° observation deck. You will also find interactive exhibits on glaciers, volcanoes and the Icelandic Landscape.
Top Tip: Visiting the Perlan at start of your trip will give you a greater understanding of the Icelandic landscape which will make your other tours/exploring more interesting with all the relevant knowledge you now possess.
Day Tours:
There are so many great tours you can do that leave from Reykjavik.
If you are only visiting for a few days, then picking a golden circle inclusive tour is a good way to see the main sights. If you have a few more days exploring the glaciers, Jökulsárlón Glacier Lagoon and Diamond Beach is a great addition. Full disclosure to avoid disappointment, these are natural attractions so can change appearances based on weather and time of year. For example, the Diamond Beach may not look like the pictures you have seen with large icebergs washed up on the beach sparkling beautifully against the black sand, some days there is little or no ice at all.
AFFORDABLE PLACE TO EAT IN REYKJAVIK
RESTAURANTS:
Traditional:
101 Reykjavik Street Food: Food: Fish & Chips, stew, meat soup. Cost: From 2250ikr
Svarta Kaffid: Food: Icelandic stews and bread (both vegetarian and meat). Free waffles and refills.
Cost from around: 3100ikr
Icelandic Street Food: Food: Icelandic stews and bread, fisherman's favourite, happy marriage cake and pancakes. Free waffles and refills on stews. Cost from around: 3000ikr
Turf House: Food: Lamb burger and Icelandic soups.
Cost from around: 2490ikr
Baejarins Beztu Pylsur: Food: Hot dogs Cost from around: 880ikr
Top Tip: Want hot dogs even cheaper? Head to a service/petrol station where they sell hot dogs for around 500-700ikr.
Le Kock: Food: Different types of potatoes, burgers, fish and other dishes of both meat and vegetarian variety. Le Kock is part of Deig, a highly rated bakery that sells baked goods, sandwiches and bagels etc. throughout the day. Cost from around: 2490 ikr
Reykjavik Chips: Food: A range of burgers, a salad, chips and drinks. Gluten free bun and vegan burger available. Cost from around: 2290ikr for the larger meals.
International:
Arabian Taste: Food: Arabian style lamb, chicken, rice, salad, kebabs, rolls and burgers. Cost from around: 1990ikr
Mai Thai Bistro:
Food: Dishes such as stir-fry's, Tom Yum, curries
and Pad Thai.
Cost from around: 2490ikr
Vietnoodles: Food: Gets less budget friendly quickly but a few good fresh meals to choose from that are still priced ok. Menu items such as dumplings, vegan dishes, fried noodles/rice and curries. Cost from around: 2490ikr
Just Wingin it: Food: Chicken wings, fries, dips and deep-fried cauliflower. Cost from around: 2850ikr
Ikea:
Food: Salmon, chicken, salad and Swedish meatballs.
Cost from around: 1200ikr
Supermarkets:
Supermarkets are always a great option if wanting to eat cheaper/ healthier, especially if your accommodation has a kitchen. Bonus is a supermarket known for its cheaper prices.
- Bonus
- Netto
- Kronan
HOTEL MAP
Here is the full list of the best hotels in Reykjavik to stay on a modest budget. You can click on the tags to go straight to the hotel or scroll through for the full pricing, photos, and descriptions. Don't forget that each hotel is color coded to indicate price. For the full price breakdown go to my hotel map page here.
REYKJAVIK
7🟡KEX Hostel & Hotel Reykjavik
8🟡Student Hostel (Gamli Gardður)
OUTER REYKJAVIK
9 🟡Hlid Fisherman Village
10🟡Base Apartments
HOTELS IN REYKJAVIK
SPECIAL NOTES: > REMEMBER THE COLOR CODING FOR PRICING WHICH CAN BE FOUND IN MORE DETAIL HERE
> THE COLOR CODING ALWAYS INDICATES THE MAX PRICE BRACKET YOU WOULD PAY FOR A ROOM IN PEAK SEASON.
>THE ROOMS ARE PRICED FOR 2 PEOPLE.
MODEST BUDGET HOTEL STAYS IN REYKJAVIK:
🟡 CITYHUB REYKJAVIK
CityHub currently has 4 pod hotels located in Amsterdam, Rotterdam, Copenhagen and Reykjavik. Each of these features the innovative pod design that balances so well a comfortable, but budget place to stay. Each pod is sound insulated, climate controlled, and features a double bed making it a place to stay for both couples and singles alike. There are shared bathrooms and a shared lounge space.
From: AUD $120+ USD $85+ EUR €75+ Per night
🟡GUESTHOUSE SUNNA
Guesthouse Sunna is a simple, clean, and no fuss accommodation located right in the heart of Reykjavik, opposite the famous Hallgrimskirkja Church. There are very few accommodation options that offer a private room in such a great location. Some of the rooms offer a private bathroom which even in peak still sits close to the max🟡price bracket. There is a communal kitchen, free parking (first come, first served) and a buffet breakfast available. Please note there are no elevators/lift if that is a requirement.
From: AUD $185+ USD $130+ EUR €115+ Per night
3. 🟡REFURINN GUESTHOUSE
Refurinn guesthouse is located within walking distance to downtown Reykjavik. The guestrooms are modern and comfortable, each with in room coffee and tea facilities. Bedrooms are laid out in either separate single beds or as a double. The bathrooms are shared along with a fully equipped communal kitchen. Luggage storage is also available if you have and early/late flight.
From: AUD $130+ USD $90+ EUR €80+ Per night
4. 🟡NORDIC HOSTEL
Nordic Hostel has stylish and private pod style accommodation. Each has blackout curtains for ultimate privacy as well as folding desks with usb ports. There's an industrial style bar/lounge to enjoy drinks at (yes, they do a happy hour), as well as modern shared bathrooms and communal kitchen.
From:
AUD $170+
USD $120+
EUR €105+
Per night
5. 🟡LOFT HI HOSTEL
With a super great location right at the end of Rainbow Street in downtown, Loft HI Hostel is worth checking out for a trip to Reykjavik. Similarly to Guesthouse Sunna, Loft HI Hostel offers private rooms with private bathrooms at a hard to come by price in peak season. For the more budget conscious there are dormitory style accommodation options. A well-known feature of HI Loft Hostel is its rooftop bar with views over the surrounding streets of Reykjavik. There are also laundry facilities, a shared kitchen, elevators, lockers and luggage storage available.
From: AUD $130+ USD $90+ EUR €80+ Per night
6. 🟡 KIMS APARTMENT - MAIN SHOPPING STREET
Another rarity of accommodation is Kim's Apartment. Located not far from the center, it features all you could need for a stay in downtown Reykjavik with a full-sized kitchen, bathroom, lounge area, and separate bedroom. The retro decor creates a warm and cozy atmosphere. Sit back and Iisten to a vinyl on the record player, or switch on the tv which includes access to Prime, Disney+ and Netflix.
From: AUD $225+ USD $160+ EUR €135+ Per night
7. 🟡 KEX HOTEL AND HOSTEL
Kex Hotel and Hostel is another accommodation which offers both dormitory style accommodation and private rooms (some which also feature private bathrooms). The cheapest option is a bed in a whopping 42 bed dormitory room. Kex has all the extra facilities you could need such as a lounge/library area, bar, outdoor patio, laundry, communal kitchen and luggage storage. Kex is also situated within easy walking distance to the main downtown street of Reykjavik.
From: AUD $95+ USD $70+ EUR €60+ Per night
8. 🟡STUDENT HOSTEL (ONLY IN SUMMER HOLIDAYS)
During the summer holiday period the University of Iceland opens up one of the students' dormitories as a hostel for people to stay in. Each floor has a shared kitchen and social room. You can choose to stay in a private room with a shared/private bathroom. Each room has views of either the garden or the city skyline. Extra features you can enjoy are the University's canteen, the Student Cellar bar and Book cafe.
From: AUD $275+ USD $195+ EUR €165+ Per night
MODEST BUDGET HOTELS OF NOTE IN OUTER REYKJAVIK
9. 🟡HLID FISHERMANS VILLAGE
Located on the tip of the Álftanes peninsula around 20 minutes' drive out of Reykjavik is Hlid Fisherman's Village. For those that have a car and don't want to stay directly in Reykjavik, or be closer to the Blue Lagoon, this is a great option to experience a traditional style Icelandic hotel with grass topped rooms and quaint buildings made of stone and natural materials. Other highlights include hot tubs and a sauna (the family room has their own private hot tub and sauna), waterfront location, and the perfect spot to see the Northern lights due to lack of artificial light.
From: AUD $180+ USD $125+ EUR €110+ Per night
10. 🟡 BASE APARTMENTS
Base Apartments are 15 minutes out of the main area of Reykjavik and have a range of studio apartments available to stay in. These apartments have a fully functioning kitchen and their own private bathroom which is a combination harder to find in this price bracket. They are comfortable and modern (if not also a bit quirky) in design and are a great choice for those that like their own space. Parking is available onsite as well as a communal laundry room The apartment pictured above is apartment 210.
From: AUD $235+ USD $165+ EUR €145+ Per night
Just a heads up: Please note that some of the links here are affiliate links (to be safe assume all). This helps me to be able to spend more time giving you great hotel recommendations. There is no cost to you but means I get a small commission from every booking made. If you plan to book through these sites anyway it would be much appreciated - but hope in the very least, you found somewhere to stay that you might not have otherwise. Thanks, Kirrily 😊