Where to Stay in Iceland: Best Areas to Visit

Every year, an increasing number of tourists flock to Iceland to gaze at its incredible natural phenomena and participate in the many exciting excursions. Due to the combination of an exploding tourism industry within petite villages, you’ll want to plan your Iceland lodging ahead of time, as towns can fill up quickly. 

Because of the marvelous scenic views of the Icelandic countryside, there is no shortage of cool places to stay in Iceland. This does come at a price though — be aware that Iceland accommodation is typically expensive. However, with a bit of planning or choosing alternative lodging options, you can still experience the beauty of this country on a budget and find great deals on where to stay in Iceland.


Reykjavik is a beautiful city with a unique style. This city is covered with street art, delectable cafes, and great architecture, making it the best city to stay in Iceland. It also makes for an excellent hub to explore the wilds of the countryside, the South Coast, and Iceland as a whole since most tours start and end in the capital. Reykjavik is an excellent place to set up your base camp in the winter months because many businesses and smaller hotels close during the off-season.

If you’re looking for where to stay in Iceland that offers higher-end accommodations, this is the spot. However, you can also find a wide range of lodging if your budget can’t accommodate expensive rates. Keep in mind that you will need to act fast because they can become fully booked very quickly. 

If you prefer to see Iceland at your own pace, there are campsites nearby that are open year-round.  Choosing this accommodation can drastically free up your budget to be spent on other activities. 


A list of best places to stay in Iceland wouldn’t be complete without mentioning Akureyri. The city in the northernmost part of the country offers unique places to stay in Iceland with a must-see culture. Akureyri is filled with fascinating museums, art galleries, parks, and naturally, quirky Icelandic homes in the area.

If you’re looking for an urban experience outside of Reykjavik, Akureyri is the best area to stay in Iceland. Here you can find a splendid coffee culture, diverse nightlife, eye-catching street art, fashionable hotels, and festivals that showcase work that never stops developing. 

Since this is the “Capital of the North,” you will find a range of lodging such as luxurious rooms at the Lava Apartments Hotel or even short-term studio apartments.  

Golden Circle (Hveragerði) 

Travelers looking to indulge in Iceland’s hot spring culture need to make their way to Hveragerði. Located in the southwest part of the country, you’ll find a geological and geothermal hotspot, giving the area the moniker “the Earthquake Center” or “Hot Springs.”

If you’re driving around the Ring Road, and wondering, “where should I stay in Iceland for a respite?” Hveragerði offers welcoming warm baths to relax weary travelers. For nature-lovers, you can find outstanding camping grounds open in the summer months.

There are a number of museums in Hveragerði, including the Ásingsúna Museum and the Hveragerðin Mineral Museum. The town also holds an annual cultural festival each August.

Snaefellsnes Peninsula 

Snaefellsnes is known as Iceland in miniature since you can find a diverse ecology covering this alien landscape. The peninsula is filled with waterfalls, black sand, freshwater caves, fishing villages, and picturesque rocks jutting out from the white-peaked glaciers on the coast.

Here, you can find the smallest of the three National Parks in Iceland. It covers the Snækull glacier/volcano, the only one in Iceland. These stunning features shouldn’t be overlooked when searching for where to stay when visiting Iceland. Accommodations typically come in the form of hostels dotted around the area, including the:

  • HI Hostel Grundarfjörður
  • Harbour Hostel in Stykkishólmur
  • Freezer Hostel in Rif


Not many visitors make it out to the East Fjords, but when they do, they are immediately greeted by Egilsstadir, the largest town in the area. This little spot in Iceland is home to all of the facilities a traveler could need. 

You have options when traveling to Egilsstadir. Buses link to larger regional cities, and Egilsstadir airport has regular flights to and from Reykjavik. If you’re looking to see Iceland from the comforts of a campervan, Camp Egilsstadir claims to be Iceland’s happiest campsite. This campsite is complete with bathrooms, showers, washing and drying machines, luggage storage, and bike rental.  A children’s play park, dishwashing area, kettle, microwave, and even free WiFi are available 24 hours a day, seven days a week.

Skaftafell National Park/Höfn

Hornafjörur is a thriving village in Iceland’s southeast near Europe’s largest glacier, Vatnajökull. Along with breath-taking scenery, the city is home to Vatnajökull National Park, Europe’s largest national park. Tourism has expanded tremendously in the last few decades. Hotels, camping grounds, restaurants, stores, swimming pools, golf courses, and designated hiking trails all await adventurous explorers.

Seeing Iceland By Camper Van 

You might be surprised to learn that one of the best places to stay in Iceland is the open road. Being behind the wheel of a campervan vehicle in a country as vast and uninhabited as Iceland gives you complete control over your vacation, for a fraction of the price. Iceland is ideal for campervan travelers, with campsites dotted throughout the country, many of which provide all of the amenities you could need.

Adventure Calls at Rent.is

If you want the flexibility of where to stay in Iceland, contact Rent.is. We can provide you with an Iceland travel guide and the perfect campervan to match your needs. Do you want a big mobile home or something more cost-effective, portable, and manageable? With us, you’ll be able to find the ideal camper to explore all of Iceland’s beauty.

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