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Hotels in Reykjavik: eight places to stay, from harbour to lava field
It is a winter afternoon and already dark when the streetlights come on along Laugavegur. Steam rises from the cafés, and somewhere above the harbour a faint green band is beginning to move. Reykjavik is small enough to walk end to end, so choosing a hotel mostly means choosing which street you want to wake up on.
Stay in 101 Reykjavik, the postcode for the centre, between the old harbour and Laugavegur. You can walk to restaurants and museums, and most tour pickups are close by. For northern lights and nature from your bed, The Retreat at Blue Lagoon is the option outside town.
Picolo picks
- Best for romance#8 The Retreat at Blue Lagoon
- Best for a first visit#1 Hotel Borg
- Best for value#7 Hotel Eyja
The old town around Austurvöllur
1. Hotel Borg
Art deco facing parliament
Hotel Borg looks straight across Austurvöllur at the Althing, Iceland's parliament. The building is one of the city's best-known art deco landmarks, and the rooms keep the period feel with dark wood, black and white details and tall windows.
It is classic without feeling stuffy, and the position is hard to beat: step outside and you are in the middle of everything. It is a strong pick for a first visit and anyone who likes a hotel with a sense of history. Rooms facing the square can pick up some noise from the bars at weekends, so ask for the back if you sleep lightly.
The old town around Austurvöllur
2. Konsulat Hotel
An old merchant street, freshly furnished
Konsulat Hotel sits on Hafnarstræti, the street linking the old town and the harbour, in a building that once held shops and offices. Inside it is modern and cosy, with greens and greys and plenty of soft textiles.
It works well for couples and for travellers who want a little more personality than the big chains offer. Harpa and the harbour are just below, and dinner is a short stroll in any direction. As part of the Hilton group, it lets you earn and spend points, and the bar is a calm place to thaw out after a day on the road.
The old town around Austurvöllur
3. Kvosin
A quiet base in the oldest quarter
Kvosin overlooks a small square just behind Austurvöllur, in the oldest part of the city. Rooms are spacious and simple, with Nordic timber furniture and pale colours.
It is a sensible pick if you want room to spread out while staying right in the centre, and it works for groups travelling together. There is no big hotel lounge or buzzing bar, so evenings are spent out in town. In Reykjavik that is hardly a hardship, with some of the best kitchens only a few streets away.
By the old harbour and Harpa
4. The Reykjavik EDITION
Harpa on one side, mountains on the other
The Reykjavik EDITION stands right beside Harpa, facing the harbour. Rooms are large and pared back in greys and warm browns, and many look out over the water towards Esja.
This is the city's most contemporary luxury hotel, with a rooftop bar, a basement club and a spa. It appeals to travellers who want a big-city hotel with somewhere to go after dinner. If you prefer quiet and cosy, the smaller old-town hotels will feel more like Iceland. Rates are among the highest in town, so watch for offers outside summer.
Laugavegur and Hverfisgata
5. Sand Hotel
Icelandic craft on the main street
Sand Hotel sits halfway along Laugavegur, yet the entrance keeps most of the street noise at bay. Rooms are light and dressed with Icelandic design, wool and sheepskin, and there is a bakery downstairs.
Book it if you want to be where things happen, with shops and coffee outside the door. Couples and friends on a long weekend will feel at home. Some rooms are compact, so upgrade a category if you are staying more than a couple of nights. If breakfast is not in the rate, the bakery is the obvious answer.
Laugavegur and Hverfisgata
6. Canopy by Hilton
Local touches and a long breakfast
Canopy sits between Laugavegur and the harbour, in a block where old and new buildings have been stitched together. The interior borrows from Iceland, from volcanic stone to knitwear, and the breakfast has a reputation for generosity.
It is a dependable choice for families and friends who want modern rooms, good service and easy access to both restaurants and tour pickups. It has a little more of the chain about it than the smallest places, but it is thoughtfully done and unfussy.
Laugavegur and Hverfisgata
7. Hotel Eyja
Eco boutique a short walk uphill
Hotel Eyja lies east of the centre, about ten minutes on foot from Laugavegur. Rooms have four-poster beds and wooden floors in a mix of Scandinavian and Balinese style, and the hotel is known for its organic breakfast.
This is our value pick: a warm boutique hotel for less than you would pay in the heart of 101. Couples who do not mind a short walk will like it. If you want bars on the doorstep, stay closer in. Nearby Hlemmur, the old bus terminal, is now a food hall with several small kitchens.
Out in the lava fields
8. The Retreat at Blue Lagoon
A lagoon of your own
The Retreat sits beside the Blue Lagoon on the Reykjanes peninsula, close to Keflavík airport. Rooms have floor-to-ceiling windows onto the lava, and guests use a private section of the milky blue lagoon and a large spa.
It is a romantic choice for your first or last night in Iceland, when you are heading to or from the airport anyway. Volcanic activity on Reykjanes has closed the area several times since 2023. Check the latest status shortly before you travel and book on flexible terms.
How Picolo chooses
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