By Monika
Iceland Accommodation Explained: What to Know Before You Book.
Choosing accommodation in Iceland can feel a bit overwhelming at first – trust me, I’ve been there.
Between remote cabins, cozy guesthouses, family-run farms, and hotels sprinkled across some of the most dramatic landscapes in the world, figuring out where to stay in Iceland (and what actually makes sense for your itinerary) takes a little strategy.
After multiple trips to Iceland – from road-tripping around the Ring Road to exploring hidden corners of the highlands – I’ve picked up a lot of practical tips about what really matters when booking places to stay in Iceland.
Things like which areas are worth an overnight stop, how early you need to book, and the pros and cons of different types of accommodation you should consider to avoid surprises when you arrive.
In this guide, I’m sharing everything I’ve learned from my experience so you can choose the right accommodation for your trip.
Let’s make your Iceland stay as magical as the trip itself!
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- Iceland Accommodation Explained: What to Know Before You Book.
- What types of accommodation can you find in Iceland?
- What amenities should I expect?
- How far in advance should I book accommodation in Iceland?
- Is it better to stay in one place or move around?
- What’s the best place to stay if I don’t have a car?
- Is Iceland's accommodation expensive?
- Best areas to stay on the Ring Road
- Where to stay in the Highlands?
- Special and unique places to stay in Iceland:
- FAQ:
What types of accommodation can you find in Iceland?
Iceland offers a wide range of places to stay, including hotels, guesthouses, hostels, cabins, apartments, cottages, and farm stays in more rural areas.
- Hotels: found in towns and major tourist hubs. Reliable, comfortable, often with breakfast included.
- Guesthouses: often family-run, warm and welcoming, sometimes with shared bathrooms.
- Cabins & Cottages: cozy, often in very scenic, remote or countryside settings.
- Hostels: budget-friendly and social, great for solo travelers and those looking to meet people.
- Farm Stays: a favorite among travelers – often offering homemade breakfasts, Icelandic hospitality, and often animals!
- Apartments: ideal for families, larger groups or anyone who wants a kitchen and more space.
What amenities should I expect?
Many places offer cozy basics rather than luxury, but you’ll often get stunning views, peaceful settings, and warm local hospitality.
What you’ll find:
- Comfortable beds – we stayed in many different types of accommodations in Iceland, but they all had one thing in common – no matter the size of the bed, they were always VERY comfy!
Good to know: it’s very common to find single beds in your hotel or apartment. Sometimes the host may ask you if you’d like them put together into a double, but it’s not always an option.
- Duvet covers vs. a comforter and a top sheet
I grew up in Europe and this is the way the beds are made there so it wasn’t a surprise for me, but it’s definitely different that what’s typical for the US.
Good to know: most often, even with a double bed, you’ll get single comforters, individual for each person.
- Hair dryers are usually provided
- You may have a washer, but dryers are not commonly available – in most cases you’ll get a drying rack to hang your clothes.
Good to know: even if your apartment does have a clothes dryer, expect the cycle to be long, a couple of hours on average, so if you plan to do some laundry during your trip, bring quick-drying clothes!
- If your accommodation has a kitchen, it will have all cooking essentials like pots, pans, dishes etc., and we found that many also had some basic spices, olive oil and delicious Icelandic COFFEE
- Wi-Fi is usually available, so you can stay connected
- Rooms are often small but very clean and well laid out
- Rooms are well-heated and on warmer days you may have to open a window for some fresh air
How far in advance should I book accommodation in Iceland?
If you’re visiting between June and September, it’s best to book as soon as you know your travel dates, at least 6 months ahead, especially in popular areas like the South Coast, Snæfellsnes Peninsula, or the Golden Circle.
In the winter months, you’ll still want to book early for areas with limited options, but there’s usually much more availability and choices.
If you’re traveling with a larger group and would like a room that accommodates everyone (i.e. a 4-people family) – book even earlier!
For our second trip in August, we grabbed the last “family room” in Hotel Jökull in September the prior year!
Helpful hint: whenever possible, try to book your accommodations with free cancellation as close to your travel dates as possible – that way you have some flexibility in case your plans or itinerary change.
Is it better to stay in one place or move around?
It really depends on your itinerary.
For a full Ring Road trip, you’llchange accommodation as you go.
If you’d like to explore South Iceland all the way to Höfn, it’s also easier to book different places to stay along the coast to break up the long drive and have more time to spend at different sites.
If you only have a few days, you can base yourself in the Reykjavík and take day trips.
That’s what we did for our first trip – we stayed just outside Reykjavik, in Kópavogur (at Icelandic Apartments) and had a great time driving to different areas each day.
Rent a proper car for your adventure with a 5% discount automatically applied to your reservation from a trusted local company I always rent from – Blue Car Rental!
What’s the best place to stay if I don’t have a car?
In this case, I recommend staying in Reykjavik.
It will be easy to explore the city (it’s very walkable) and also take guided tours to other areas of Iceland.
Most tour companies have meeting points in a central place in the city (like a bus stop or a landmark), but a lot of them also offer pick-up from your accommodation.
Here are some popular and highly rated choices:
Read more: How to See Iceland Without a Car: Best Tours and + Itinerary.
Is Iceland’s accommodation expensive?
Generally, yes – Iceland is known for high travel costs.
However, booking early and staying outside major tourist hubs can help lower the cost.
Booking guesthouses with shared bathrooms and hostels can also help stretch your budget.
We stayed in Klausturhof guesthouse with bathrooms shared by the entire floor, and it was always pristine and well-stocked with basics like body wash and shampoo.
I also stayed at Start Hostel near the airport, and both the room and the bathroom were spot on, and breakfast (included!) was amazing.
I have many tips on how to plan a trip to Iceland on a budget but there is one that’s accommodation-related: book a place with a kitchen or at least a breakfast included. Eating out in Iceland is very expensive and preparing your own meals will save you both money and time.
And hotel breakfasts in Iceland are amazing, often including home-baked bread and local meats, cheeses, jams, and so much more! Hotel Jökull even had cod liver oil to boost your immunity and energy for another day of exploring!
Best areas to stay on the Ring Road
As I mentioned above, if you’re traveling around the Ring Road, you’ll want to change places to stay to avoid backtracking, if not every day, then at least every couple of days.
Here are popular towns to stay in:
South Coast:
We stayed in Prestshús 2 Guesthouse, Klausturhof Guesthouse and Selfell Guesthouse.
READ MORE: Best Things to Do in Vik, Iceland – Your Ultimate Guide.
- Glacier lagoons and Höfn area
We stayed in Hali Country Hotel and Hotel Jökull.
North Iceland:
We stayed in Saga Apartments in Akureyri and in Fjalladýrð Guesthouse in Möðrudalur.
Learn more about the Möðrudalur Farm and why it’s a must for your itinerary!
West Iceland:
I haven’t stayed overnight in this region but the most popular towns for visiting this stunning area are located on Snæfellsnes Peninsula: in Borgarnes, Grundarfjörður and we can’t skip the iconic Hotel Búðir.
The Golden Circle
We stayed in BSG Apartments, Bella Apartments and Miðdalskot Cottages.
Where to stay in the Highlands?
The Highlands are remote, and accommodation options are limited. The most popular and most visited areas are Kerlingarfjöll and Landmannalaugar, and the best places to stay there are
- Highland Base at Kerlingarfjöll (Kerlingarfjöll)
- The Highland Center Hrauneyjar (Landmannalaugar)
The Golden Circle hotels are also a good base for travelling to those areas.
Special and unique places to stay in Iceland:
Are you looking for a unique experience? Check out
For a bit of luxury, consider staying at The Retreat at Blue Lagoon Iceland with easy access to the iconic Blue Lagoon spa right from your room!
My last accommodation tip for you? Take your shoes off inside! It’s expected and shows respect to your host and their place.
FAQ:
Reykjavík area is the easiest base for short trips, offering plenty of options for dining, tours, and transportation. For road trips or exploring the Ring Road, staying in multiple regions (South Coast, the Golden Circle, North Iceland, Snæfellsnes) is much more convenient.
Underestimating driving distances and weather. Choose stays that logically match your itinerary rather than crossing the island back and forth. Always check the road status and weather forecast.
Yes, unless you’re staying in Reykjavik. You’ll definitely want a rental car for rural stays. Some accommodations are remote and not accessible by public transit.
Book as early as possible – especially for summer, winter holidays, and popular regions like the South Coast or Snæfellsnes Peninsula. Iceland has limited lodging outside major towns, and places with the best locations or views often sell out months ahead. Last-minute deals are rare, and prices usually increase closer to the busy summer season.
Absolutely – they’re a great option. You’ll often get homemade breakfasts, friendly Icelandic hospitality, and a true taste of countryside life. Not to mention friendly farm animals!
Check out Prestshús 2 Guesthouse and Möðrudalur Fjalladýrð Farm – we loved both places!
Are you ready to plan your trip? Don’t miss my tips for first-time visitors to Iceland and my guide to mistakes to avoid in Iceland.
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Get organized with this printable, fillable 45-page ICELAND TRAVEL PLANNER – keep track of flights, hotels, tours, daily itineraries and even your trip budget!
BONUS! The planner has journal pages for your memories!
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- Best Black Sand Beaches in Iceland – a Practical Guide.
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For more Iceland inspiration and travel guides click HERE.
About Monika
An avid traveler and a passionate trip planner, mildly obsessed with being organized and prepared 🙂
Well aware of how precious travel time is, I’m here to share my experience and help you get the most out of your vacation time.
“Taking the hassle out of trip planning”
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