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Iceland accommodation that’ll really set the benchmark

Great deals on great places to stay in Iceland.

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Stephanie Yip
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From the breathtaking Northern Lights to soothing hot springs there are more than a few reasons to visit Iceland.

While Reykjavik is the obvious starting point, true adventure seekers will make their way around the country. Stop by Keflavík to stay close to the Blue Lagoon, Siglufjordur for coastal fjord views and Laugar to catch the northern lights.

To see it all, we've hand-picked the best accommodation options the Iceland has to offer.

Top Iceland hotels in South Iceland

Top hostel: Reykjavik Downtown HI Hostel, Reykjavik

Top hostel: Reykjavik Downtown HI Hostel, Reykjavik from Finder Hotels

With rave reviews, a central location and 24-hour access, Reykjavik Downtown HI Hostel is a budget-friendly option well-suited for backpackers.

  • Star rating: 1-star
  • Location: Vesturgata 17 , Vesturbaer, Reykjavik
  • Rooms from: $146 per night
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Top all-rounder: CenterHotel Thingholt, Reykjavik

Top all-rounder: CenterHotel Thingholt, Reykjavik from Finder Hotels

If you wish to stay at a prime location in the city, this is a contemporary hotel just a few minutes away from Reykjavik Cathedral, The Sun Voyager and Laugavegur. Head to the rooftop restaurant to enjoy authentic traditional dishes

  • Star rating: 4-star
  • Location: Thingholtsstraeti 3-5, Midborg, Reykjavik
  • Rooms from: $580 per night
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Cheap hotel chain: Hilton Reykjavik Nordica, Reykjavik

Cheap hotel chain: Hilton Reykjavik Nordica, Reykjavik from Finder Hotels

The Hilton is ideally located within a walking distance of the Iceland Academy of the Arts. Enjoy panoramic views of Reykjavik from your room and relax in the hotel’s excellent spa and jacuzzi. It might be a chain but for a 4-star hotel it's very well priced for Iceland.

  • Star rating: 4-star
  • Location: Sudurlandsbraut 2, Hlidar, Reykjavik
  • Rooms from: $367 per night
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Top luxury boutique hotel: Diamond Suites, Keflavík

Top luxury boutique hotel: Diamond Suites, Keflavík from Finder Hotels

Just a short walk from the Reykjanes Art Museum, Grindavík and Hafnarfjӧrdur, Iceland’s only 5-star hotel offers a luxurious stay. This hotel features a barbeque, picnic area, in-house restaurant and fitness centre. It's also a short 20 minute drive to the famous Blue Lagoon.

  • Star rating: 5-star
  • Location: Vatnsesvegi 12-14, Keflavík
  • Rooms from: $1,237 per night
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Top country/farmstay: Grand Guesthouse Gardakot, Gardakot

Top country/farmstay: Grand Guesthouse Gardakot, Gardakot from Finder Hotels

Grand Guesthouse Gardakot is located near a beautiful beach in the countryside, and and is perfect for those planning a relaxing holiday. The guesthouse has four comfortable rooms and offers the environment you need for a romantic getaway.

  • Star rating: 5-star
  • Location: Gardakot, Vik
  • Rooms from: Rates on request
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Top airport hotel: Bed and Breakfast Keflavik Airport Hotel

Top airport hotel: Bed and Breakfast Keflavik Airport Hotel from Finder Hotels

Just a 10 minute walk from Keflavik International Airport is this cosy bed and breakfast. It offers family friendly accommodation, outdoor activities and a tour desk to see the area easily.

  • Star rating: 3-star
  • Location: Valhallarbraut 761, Keflavik
  • Rooms from: $156 per night
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Top Iceland hotels in North Iceland

Top Northern Lights hotel: North Aurora Guesthouse, Laugar

Top Northern Lights hotel: North Aurora Guesthouse, Laugar from Finder Hotels

With five comfortable and clean rooms, North Aurora Guesthouse offers breathtaking views of the surrounding mountains. Being so far north in a small township, Laugar is regarded as one of the best locations to catch the Northern Lights - hence the name.

  • Star rating: 5-star
  • Location: Lautavegur 8, Laugar
  • Rooms from: $485 per night
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Top farmstay in the north: The Herring Guesthouse, Siglufjordur

Top farmstay in the north: The Herring Guesthouse, Siglufjordur from Finder Hotels

Situated near Siglufjordur Airport, the guesthouse offers an enjoyable stay near the Herring Era Museum. The place is renowned for its snow sports and fine dining experiences.

  • Star rating: 5-star
  • Location: Havegur 5, Siglufjordur
  • Rooms from: $238 per night
View details

How did we pick these Iceland hotels?

Our editorial team selected the Iceland hotels on this list based on price, location and real customer feedback from hotel booking sites and review platforms. Where applicable, we used our own personal experiences to make recommendations.

Which sites let me book Iceland accommodation with free cancellation?

These sites let you make a refundable booking for your trip to Iceland, so there's less risk of losing the cost of your stay or deposit. Some sites only offer free cancellation on select Iceland hotels or at a slightly higher rate, so it's best to check the terms on your booking before confirming your stay.

Most sites, like Wotif or Expedia, will clearly state whether each Iceland hotel is non-refundable.

See the latest coupon codes

Which sites let me use a coupon code to book Iceland accommodation?

Using one of our coupon codes at these sites will save you money on your Iceland stay. Some may ask you to pay for your stay upfront rather than on arrival in order to apply the code to your Iceland booking, but the same cancellation policy does apply so if you are able to cancel, you'll be able to get refunded.

Which sites let me book Iceland accommodation without a credit card?

If you don't have a credit card to make your Iceland booking, but would like to reap the rewards of one, compare credit cards that offer hotel rewards here.

Which Iceland hotel booking sites have rewards programs?

Get access to cheaper prices, collect points toward free stays and get extra perks like Wi-Fi or breakfast if you book your Iceland accommodation on sites like these:

  • Wotif: Part of the same family, Wotif lets you access the same benefits as the Expedia Rewards program. You'll get access to lower rates and earn points, which can be used toward discounted stays in the future. Depending on how often you make bookings, you'll be able to get bigger discounts and earn more perks like breakfast.
  • Agoda: PointsMAX lets you earn up to 6,000 points for your stay that you can put toward a preferred loyalty or frequent flyer program, including KrisFlyer and Velocity.
  • Trip.com: Trip Coins is Trip.com's rewards program where you can earn $1 for every 100 Trip Coins. It's free to join the program. Membership tiers from Silver, Gold, Platinum and Diamond have different perks to enjoy.
  • Hotels.com: Collect one stamp for every night's stay. Once you stay for 10 nights, you'll be able to redeem one free night up to the average value of your previous 10 nights.
  • Expedia.com.au: Access lower rates as a member and earn Expedia points on bookings, which can be used toward discounted stays in the future. Different levels of membership get you access to deeper discounts and perks, such as free breakfasts.
  • Marriott: The Marriott Bonvoy Benefits program lets you earn points towards free nights, access special member rates, get free Wi-Fi with your stay and check into your room via the mobile app. There are different status levels depending on how often you stay, starting with Silver Elite (10 nights per year).

Iceland hotel deals

Agoda
Code exclusive

Extra 10% off worldwide hotels with code

Expires 30 Sep 2021
Available on stays until 31 December 2022 when you use the code. Destinations include New Zealand, Fiji, London, Maldives, Japan, USA and more. T&Cs apply.
Show code
Priceline.com
Deal

Up to 50% off worldwide stays

Become a member and get up to 50% off hotels. Destinations include Australia, New Zealand, USA and more.
Get deal
IHG AMEA
Deal

Up to 5% extra savings on stays

Sign up your email and become an IHG member to enjoy discounts and earn points or stays worldwide including Australia. T&Cs apply.
Get deal
Hotwire
Deal

Extra $10 off worldwide hotels

Sign up your email address and receive discounts. Destinations include Las Vegas, London, New York, Toronto, Dubai and more. T&Cs apply.
Get deal
Hotels.com
Deal

Earn a free night’s stay

Stay for 10 nights at any hotel worldwide to get a free night. Must be a Hotels.com Rewards members. Membership is free. T&Cs apply.
Get deal
Best Western
Deal

Free nights with Best Western Rewards points

Earn points and redeem a free night on worldwide stays. Destinations include Canada, USA and more. T&Cs apply.
Get deal
Marriott
Deal

Up to 25% off worldwide stays

Enroll and save 25% with Marriott Bonvoy Escapes. As a member, you can experience these exclusive benefits.
Get deal
Best Western
Deal

Up to 30% off Europe stays

Available on select stay dates at participating Best Western® Hotels & Resorts when you book 21 days in advance. T&Cs apply.
Get deal

Feature image: Grand Guesthouse Gardakot

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