Planning your stay in Reykjavik? Discover the best places to rest, relax, and explore with this ultimate ‘Where To Stay In Reykjavik’ guide!
The capital city of Iceland has everything you could ever need, but with so many options, finding the perfect place to stay in Reykjavik can be a daunting task.
Fear not, as this comprehensive guide is here to help you make the best choice for your vacation.
I’ll walk you through the top neighborhoods and hotels that cater to every traveler’s needs, from budget-friendly options to luxurious stays.
Let’s dive in and discover the best hotels in Reykjavik Iceland!
QUICK PICKS: WHERE TO STAY IN REYKJAVIK
If you’re in a hurry and don’t have time to read this full guide, these are the 3 best hotels in Reykjavik to suit all budgets.
Best Luxury Hotel in Reykjavik
The Reykjavik EDITION ⭐️⭐️⭐️⭐️⭐️
- State-of-the-art service
- Stunning interior design and amenities
- Excellent location 5 minutes from the city center
Best Mid-Range Hotel in Reykjavik
105 – A Townhouse Hotel ⭐️⭐️⭐️
- Spotless, functional rooms
- 24-hour reception and great location
- All rooms equipped with slippers, toiletries, and TV
Best Budget Hotel in Reykjavik
Bus Hostel Reykjavik ⭐️⭐️⭐️
- Clean, modern rooms and dorms
- Affordable price and peaceful setting
- Near the bus terminal
WHERE TO STAY IN REYKJAVIK – FAQ
Before I dive into all the best places to stay in Reykavik, here are some quick answers to the most frequently asked questions from first-time visitors.
WHAT IS THE BEST AREA TO STAY IN REYKJAVIK?
Midbord, which is the downtown area (also known as 101), is the best option to stay in Reykjavik.
This central location offers easy access to many of the city’s top attractions, such as Hallgrímskirkja, Harpa Concert Hall, and Laugavegur shopping street.
Additionally, you’ll find a wide range of restaurants, cafes, and bars within walking distance and convenient access to public transportation.
WHERE TO STAY IN REYKJAVIK FOR FAMILIES?
Laugardalur is a great option for families looking for a comfortable and convenient place to stay in Reykjavik.
Located in the heart of the city, Laugardalur is home to some of the best family-friendly hotels in Reykjavik.
Plus, you’ll find attractions like the National Museum of Iceland and the Reykjavik Zoo.
WHERE TO STAY IN REYKJAVIK ON A BUDGET?
Hlidar, the student district, is the best option to stay on a budget when visiting Reykjavik, as the area is home to many hostels and affordable properties.
Apart from cheaper stays, you’ll also find lively vibes, the Reykjavík Art Museum, as well as local, affordable restaurants.
All in all, Hlidar is where the cheap hotels in Reykjavik are!
WHAT IS THE BEST AREA TO STAY IN REYKJAVIK FOR NIGHTLIFE?
The best area to stay in Reykjavik for nightlife is downtown Reykjavik, also known as Miðborg or Midbord.
This central location is the city’s bustling hub for entertainment, including bars, clubs, restaurants, and live music venues.
The main streets, Laugavegur and Hverfisgata, are lined with popular spots where locals and tourists gather to live the night and party.
By staying in downtown Reykjavik, you’ll be within walking distance of the best nightlife options, making it easy to explore and experience the city’s lively atmosphere after dark.
BEST PLACES TO STAY IN REYKJAVIK
The majority of hotels in Reykjavik can be found in these areas:
- Midborg/Downtown – Best place to stay in Reykjavik for first-timers
- Hlidar – Where to stay in Reykjavik on a budget
- Vesturbær – Best place in Reykjavik for luxury stays
- Laugardalur – Where to stay in Reykjavik for families
- Árbær – Best place to stay in Reykjavik for nature lovers
Below you will find my personalized recommended accommodations in Reykjavik in each of these main areas, including budget hotels, mid-range hotels, and luxury properties.
Let’s get started with this complete guide to the best areas, cities, and hotels in Reykjavik!
MIDBORG/DOWNTOWN – WHERE TO STAY IN REYKJAVIK FOR FIRST-TIMERS
Miðborg, also known as Reykjavik 101 or downtown Reykjavik, is the lively heart of Iceland’s capital city.
This bustling area is a must-visit for travelers seeking a blend of history, culture, and entertainment.
It’s home to Hallgrímskirkja, the largest church in Iceland, the Harpa Concert Hall, with its stunning glass facade, and the Einar Jónsson Sculpture Garden.
When it comes to dining and shopping, the area is filled with nice stores and restaurants, and strolling around is an excellent way to enjoy the local vibes.
Of course, there are plenty of accommodation options around, and I’ll tell you everything about it below.
BEST LUXURY HOTEL IN MIDBORD – The Reykjavik EDITION
Let’s start this list of where to stay in Reykjavik with The Reykjavik EDITION, a luxurious 5-star hotel nestled in the heart of the city.
Located just 600 meters from the iconic Solfar Sun Voyager, this Reykjavik hotel offers an exquisite blend of comfort and convenience.
The stunning rooms have plush seating areas, flat-screen TVs, and safety deposit boxes. On top of that, you’ll find breathtaking city views, as well as premium bed linens and towels for your ultimate relaxation.
Each morning, you can indulge in a delectable à la carte breakfast. And after a trip to the Golden Circle or around town, you can unwind at the elegant bar, perfect for sipping on a cocktail.
Among other amenities, The Reykjavik EDITION also offers a spa and wellness center, a gym, a sauna, and a hammam.
What to say, it’s simply one of the best hotels in Reykjavik and I couldn’t recommend it enough.
Star Rating: ⭐️⭐️⭐️⭐️⭐️
BEST MID-RANGE HOTEL IN REYKJAVIK 101 – Hotel Holt – The Art Hotel
An excellent mid-range hotel in Reykjavik is Hotel Holt – The Art Hotel, an enchanting retreat located just 650 feet from Reykjavik’s vibrant main shopping street.
Each of the rooms features satellite TV, a kettle, fast WiFi, a minibar, free toiletries, and beautiful city views.
Apart from that, you can enjoy the spacious lounge, as well as paintings and pieces of art all around the property.
If you plan to rent a car and drive around the country, you’ll be happy to know that Hotel Holt has free private parking, allowing you to park your car during your stay.
Lastly, their dedicated staff is committed to making your stay exceptional, offering personalized restaurant recommendations, and assisting with booking tours in the surrounding area.
Star Rating: ⭐️⭐️⭐️⭐️
BEST BUDGET HOTEL IN DOWNTOWN REYKJAVIK – Kex Hostel
The best budget accommodation in Downtown Reykjavik is Kex Hostel, which has not only affordable rooms but also a premium setting.
With its eclectic mix of rooms and dorms, Kex Hostel offers a unique blend of comfort and affordability, all within walking distance of Reykjavik’s most popular attractions.
Each room at Kex Hostel is nicely designed and equipped with free Wi-Fi access, a seating area, and a wardrobe for your convenience.
Start your day with a delicious buffet breakfast, and enjoy other meals at the on-site restaurant if you don’t feel like going into town.
It’s worth noting that their dorms can accommodate up to 42 people, which sounds like a lot, but they’re spacious and spotless, making it the perfect budget option!
Plus, you can meet other travelers here, and that is an amazing way to make friends on the road.
All in all, Kex Hostel is by far one of the best cheap hotels in Reykjavik and you should definitely consider it.
HLIDAR – BEST AREA TO STAY IN REYKJAVIK ON A BUDGET
If you’re looking for a great place to stay in Reykjavik on a budget, then Hlidar is your best bet.
Located east of the city center, Hlidar is a lively and diverse neighborhood that offers plenty of affordable accommodations. From guesthouses to rentals, there’s something for everyone here.
Hlidar is also home to some great restaurants, bars, museums, and shops. It’s also close enough to downtown Reykjavik that you can easily explore the city’s top landmarks like Hallgrimskirkja church.
Plus, it’s only about 10 minutes away from the airport, so it’s easy to get settled when you arrive.
Overall, Hlidar is an excellent choice for travelers who want to experience all that Reykjavik has to offer without breaking the bank.
BEST LUXURY HOTEL IN REYKJAVIK HLIDAR – Eyja Guldsmeden Hotel
Imagine staying in a hotel where every detail has been carefully thought out to ensure your comfort.
Located just off the bustling main shopping street of Reykjavík, Eyja Guldsmeden Hotel offers just that.
This stunning hotel boasts incredible city views, as well as clean, modern rooms with Balinese-style furniture.
As you enter your room, you’ll be greeted with beautiful interior decor, an original setting, and a cozy bed, perfect for relaxing after a day of exploring.
Wake up to a refreshing shower with Guldmeden’s own organic toiletries before having an organic, fresh breakfast that’ll set you for the day.
You will also find a fitness center at the hotel, as well as free WiFi on every corner, and free parking, which is convenient when driving your own vehicle.
Needless to say, this is one of the best hotels in Reykjavik and you’ll love spending a few nights here!
Star Rating: ⭐️⭐️⭐️⭐️
BEST MID-RANGE HOTEL IN HLIDAR – 105 – A Townhouse Hotel
Experience the eclectic charm of Reykjavík with a stay at 105 – A Townhouse Hotel!
Nestled just 400 meters away from Hlemmur Square, this Reykjavik hotel offers an excellent location for exploring the city.
Let’s start by saying that the rooms are designed for ultimate comfort, with each one featuring a flat-screen TV, coffee machine, and kettle.
You’ll love stepping into your bathroom, which boasts a luxurious bath or shower, along with complimentary slippers and free toiletries.
With a 24-hour front desk, private on-site parking, and complimentary WiFi, you know this is going to be one of the nicest places to stay in Reykjavik.
That’s not all, most tourist attractions are within walking distance, and you’ll love exploring all the sights.
Choose A Townhouse Hotel as your home away from home during your Icelandic getaway!
Star Rating: ⭐️⭐️⭐️
BEST BUDGET HOTEL IN HLIDAR – Bus Hostel Reykjavik
Looking for a place that’s modern, lively, and conveniently located? Look no further than Bus Hostel in Reykjavik!
This recently renovated hostel boasts a fantastic location near Reykjavik’s transportation hub, making it the perfect base to roam.
With free transfers to and from Keflavík International Airport and Blue and Sky Lagoon, getting around has never been easier.
Now, when it comes to the rooms, you’ll be happy to find private rooms and shared dorms, all equipped with secure lockers, bed linen, and covers.
Boasting modern facilities including a shared kitchen, shared bathroom facilities, and two patios for getting fresh air.
But that’s not all – the hostel is also a hub for socializing and fun, as they have local beers on tap, sports events, board games, and much more!
Put simply, it’s the perfect budget hotel in Reykjavik, and who knows, you might make lifelong friends!
This hostel in Reykjavik sells out pretty quickly, so you’ll want to book it as soon as possible.
Star Rating: ⭐️⭐️⭐️
VESTURBÆR – HIGH-END AREA TO STAY IN REYKJAVIK
Vesturbær is a high-end area to stay in Reykjavik, located just to the west of the city center.
It’s a sprawling area that includes more residential houses, and seaside hotels in Reykjavik with water views.
It’s a great place to stay both in terms of accommodation and also because you will always be close to all the attractions and activities that Reykjavik has to offer.
The area is also home to many cultural institutions, such as the National Museum of Iceland to learn about the country.
There are plenty of restaurants, cafes, bars, and shops around, so you can enjoy some local delicacies or pick up souvenirs for your friends back home.
I highly recommend Vesturbær when considering places to stay in Reykjavik.
BEST LUXURY HOTEL IN REYKJAVIK VESTURBÆR – Grandi by Center Hotels
Experience sophistication and comfort at Grandi by Center Hotels, located right in Vesturbær.
This 4-star hotel in Reykjavik offers exceptional service with countless amenities to ensure a memorable stay.
From spotless rooms furnished with the most modern amenities to a delicious buffet breakfast to start the day off the right, you’re definitely in for a treat.
All the rooms have a desk, flat-screen TV, free WiFi, private bathroom, and hairdryer. Some even feature a balcony to relax after a day of exploring.
When it comes to space, all the rooms are spacious enough to feel right at home, and the shared area is excellent for relaxing and unwind before exploring the city.
Whether it’s a solo trip, romantic getaway, or family vacation, the staff will do everything to make your stay a perfect one.
Star Rating: ⭐️⭐️⭐️⭐️
BEST MID-RANGE HOTEL IN VESTURBÆR – Apartments Reykjavik
Apartments Reykjavik is a newly renovated gem tucked in the heart of Vesturbær, just a short 1.9 km distance from the iconic Hallgrímskirkja Church.
Boasting stunning garden views, this apartment complex offers the perfect combination of comfort and convenience in a great location.
The apartments are equipped with a fully functional kitchen complete with a dining area, microwave, kettle, and toaster, making it perfect for those seeking a homey place to stay in Reykjavík.
Travel in style and comfort with Apartments Reykjavik, you’re sure to have a nice time here at a reasonable price!
Star Rating: ⭐️⭐️⭐️
BEST BUDGET HOTEL IN VESTURBÆR – Refurinn Reykjavik Guesthouse
While Vesturbær is the premium area in Reykjavik, you can find affordable accommodation here, and Refurinn Reykjavik Guesthouse is the perfect example.
Popular attractions like Hallgrímskirkja Church and Solfar Sun Voyager are only a short walk away, so you’re never far from the action.
The guesthouse offers a shared kitchen for you to prepare your own meals, as well as luggage storage for convenience.
Rooms are equipped with free WiFi and come with bed linens and towels provided. Bathrooms are shared but you’ll always find them clean and organized.
In short, Refurinn Reykjavik Guesthouse is a comfortable, budget-friendly option in a great location, and it’s hard to find a better choice for budget hotels in Reykjavik.
LAUGARDALUR – WHERE TO STAY IN REYKJAVIK FOR FAMILIES
Another of the best areas to stay in Reykjavik is Laugardalur, which is particularly good for families.
Located just outside the city center, it’s close enough to explore all of Reykjavik’s attractions, but far enough away that you can enjoy some peace and quiet.
The area is well-known for its many parks and green spaces, like the Reykjavík Park and Zoo, making it a great spot for outdoor activities with kids.
For shopping and dining options, you’ll find several supermarkets in the area as well as restaurants serving up local cuisine.
Of course, there are plenty of hotels and guesthouses to choose from in Laugardalur which I have highlighted below.
BEST LUXURY HOTEL IN LAUGARDALUR – Hótel Reykjavík Grand
For a premium stay in Laugardalur, Hotel Reykjavik Grand is the best choice.
Nestled just 2 km from the city center, this Reykjavik hotel is the perfect pick for those seeking a luxurious and comfortable stay.
With its wellness spa, bar, restaurant, free gym access, and spotless rooms, you’ll have the perfect accommodation for your trip.
Boasting spacious rooms equipped with modern amenities such as flat-screen TV, tea/coffee facilities, and a mini-fridge, you’ll find everything you need at your fingertips.
The on-site spa offers plenty of treatments like massages, pedicures, and facials, so you’ll leave feeling refreshed, which is exactly what you need after exploring Iceland’s countryside!
Lastly, you’ll be happy to have a meal at the Grand Brasserie Restaurant, which has Icelandic and Nordic dishes, perfect for a unique meal!
Overall, Hotel Reykjavik Grand is simply one of the best hotels in Reykjavik and I recommend booking it now as they sell out fast during the peak season.
Star Rating: ⭐️⭐️⭐️⭐️
BEST MID-RANGE HOTEL IN LAUGARDALUR – Nordurey Hotel City Garden
Next on this list of best hotels where to stay in Reykjavik is Nordurey City Garden, a fantastic option for families who want to explore the city’s main attractions.
In fact, it’s on the western edge of Laugardalur, which is near the iconic Rainbow Street and other attractions.
In terms of rooms and amenities, all rooms have everything you need, like a flat-screen TV, a desk, and beautiful bathrooms with free toiletries and a hairdryer.
The overall design of the hotel’s rooms is simple and elegant, and you’ll feel at home as soon as you step in!
Of course, all the essentials are provided too, such as free WiFi, parking, a fridge in the room, and a minimal yet modern shared lounge.
All in all, Nordurey Hotel provides comfortable and convenient accommodations in a prime location, making it a top choice for everyone.
Star Rating: ⭐️⭐️⭐️
BEST BUDGET HOTEL IN LAUGARDALUR – Hotel Cabin
My hand-picked budget accommodation in Reykjavik in Laugardalur is Hotel Cabin, and apart from the attractive rates, it’s easy to see why it’s a great place to stay.
Nestled in the western part of the family-friendly neighborhood, Hotel Cabin offers comfortable accommodation just a stone’s throw away from a host of exciting attractions.
All rooms are equipped with a TV, free WiFi, and a cozy bed for relaxing after a long day.
In the morning, you can enjoy a buffet breakfast at the on-site restaurant, and, at night, you can have a drink at the bar, which is a nice touch at the end of the day.
Whether you’re traveling with family, friends, or as a solo adventurer, Hotel Cabin is the perfect choice in one of the best areas to stay in Reykjavik.
Star Rating: ⭐️⭐️
ÁRBÆR – WHERE TO STAY IN REYKJAVIK FOR NATURE LOVERS
The last area on this list of best places to stay in Reykjavik is Árbær.
This charming and quiet neighborhood is located just outside of the city and is surrounded by lush green spaces and stunning views of the surrounding mountains.
When it comes to accommodation, Árbær has plenty of options, which are generally cheaper, quieter, and more unique than those in Reykjavik’s city center.
Other than its proximity to nature and attractions, Árbær also has plenty of dining options. From cozy cafes to delicious seafood restaurants, it won’t be difficult to find your happy place here.
Here are my hotel recommendations for Árbær, your quiet retreat away from home.
BEST LUXURY HOTEL IN ÁRBÆR – Reykjavik Domes
I just mentioned that Árbær is home to some unique accommodations, and Reykjavik Domes is the perfect example.
Perched amongst stunning mountain views, Reykjavik Domes offers exquisite accommodation that delivers an immersive experience.
Despite being near the mountains, you’ll be able to enjoy high-speed WiFi, as well as a cozy patio with nice garden views.
Convenience is also there, with a shared kitchen and full-day security service in place, you can enjoy the perfect stay no matter what!
The luxurious tents come equipped with a fireplace that guarantees warmth and comfort.
Some units feature a private bathroom complete with a hot tub, bathrobes, slippers, and a hair dryer.
Reykjavik Domes takes pride in providing a top-of-the-line hospitality experience, and it’s easy to see as soon as you check in!
BEST MID-RANGE HOTEL IN ÁRBÆR – Hótel Heiðmörk
Right on the southern part of Árbær, Hotel Heiðmörk is a premier accommodation in Reykjavik that is just perfect for those who seek ultimate peace and relaxation.
With facilities like a shared lounge, a bar, a free parking lot, and free, fast WiFi, it’s the perfect mid-range option with affordable prices.
The rooms are just as good as the hotel itself, being well-appointed and equipped with a flat-screen TV, private bathrooms with a shower, a hairdryer, and so much more.
The hotel is located just 10 km from the iconic Hallgrímskirkja Church, which is pretty nearby by car or taxi.
Overall, Hotel Heidmörk for the ideal getaway and is focused on comfort, convenience, and fine service.
Needless to say, this Reykjavik hotel will make sure that your trip is memorable and enjoyable for all the right reasons!
Star Rating: ⭐️⭐️⭐️
BEST BUDGET HOTEL IN ÁRBÆR – Ubak Guesthouse
Last but definitely not least on this selection of cheap hotels in Reykjavik is Ubak Guesthouse, a comfortable accommodation surrounded by lush gardens.
Despite being in a quiet area, the guesthouse has everything you need, from free WiFi to a car park and a washing machine with a dryer.
The rooms offer stunning views of the garden and come with a cozy bed, a shared bathroom, a hair dryer, and a fully furnished kitchen with all the necessary appliances.
Every unit at the guest house comes with complimentary bed linen and towels, along with a microwave, toaster, and fridge, perfect if you plan to prepare your own meals.
If you’re seeking a comfortable stay without all the frills, Ubak Guesthouse is simply the best value for money you’ll find right out of Reykjavik.
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SUMMARY – BEST HOTELS IN REYKJAVIK, ICELAND
This was everything you needed to know about where to stay in Reykjavik, from the best luxury hotels to cheap hotels in Reykjavik.
I hope you enjoyed reading this article and if you have any questions about the best areas to stay in Reykjavik, please leave a comment below this post and I will get back to you as soon as I can.
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