Where to Stay in Iceland: 4 Incredible Hotels We Loved (With Photos & Honest Reviews)
Planning a trip to Iceland and wondering where to stay? Whether you’re road-tripping the Ring Road, exploring the Snæfellsnes Peninsula, or chasing waterfalls on the South Coast—where you sleep each night can make or break the experience.
After spending over a week exploring the best of Iceland, here are four unforgettable places we stayed—each with their own unique vibe, stunning views, and travel-worthy locations. We saved the best for last…
1. Fosshotel Reykjavik
📍Location: Reykjavik city center
🔗 Visit Hotel Website
Why We Chose It:
Fosshotel Reykjavik is Iceland’s largest hotel—and it makes a perfect home base for exploring the capital. It’s walkable to all the best restaurants, bars, and sights like Hallgrímskirkja and Harpa.
Our Thoughts:
This hotel felt modern, clean, and comfortable—exactly what we needed after a red-eye flight. The breakfast buffet (which includes Icelandic skyr, meats, and hot dishes) was a welcome perk before our road trip began. Underground parking and on street parking on site was also convenient if you’re renting a car.
Pros:
Central location
Amazing breakfast buffet
Comfortable beds and black-out curtains
Great for first or last night in Iceland
Worth noting:
It’s a big hotel, so it doesn’t have the “boutique” vibe some travelers might prefer—but it’s extremely reliable and well located.
Best For:
Couples, first-time visitors, or anyone starting their Iceland itinerary in Reykjavik.
2. Hótel Búðir
📍Location: Snæfellsnes Peninsula, near Snæfellsjökull National Park
🔗 Visit Hotel Website
Why We Chose It:
Nestled in one of the most picturesque spots in Iceland, this historic countryside hotel has been on our bucket list for years. It’s near black sand beaches, dramatic lava fields, and the iconic black church Búðakirkja.
Our Thoughts:
This was hands down one of the most scenic places we stayed. The hotel has an old-world charm with cozy decor, warm hospitality, and panoramic views from every window. We enjoyed an incredible dinner at the on-site restaurant featuring local Icelandic dishes, and their breakfast buffet the next morning was the perfect way to start a day of exploring.
Pros:
Incredible remote location with views of the sea and Snæfellsjökull glacier
On-site restaurant with amazing local cuisine
Breakfast buffet
Historic charm meets cozy luxury
Worth noting:
There’s not much else around—so this is best for travelers looking to unplug and soak in nature (literally and figuratively).
Best For:
Couples, photographers, or anyone seeking a quiet, scenic escape.
3. Fosshotel Núpar
📍Location: Between Vík and Jökulsárlón Glacier Lagoon
🔗 Visit Hotel Website
Why We Chose It:
If you’re road-tripping the South Coast, Fosshotel Núpar is ideally located between major stops like Vík, Fjaðrárgljúfur Canyon, and Jökulsárlón. It’s also a great launch point for glacier tours or Diamond Beach.
Our Thoughts:
The location was super convenient, and the panoramic views of lava fields right outside our room were wild. While it’s more of a functional stay, it had everything we needed—including a breakfast buffet and a dinner restaurant on-site, which was a huge bonus given how remote the area is.
Pros:
Convenient stopover on the Ring Road
Great views of Icelandic landscapes from your room
On-site breakfast buffet and restaurant
Easy access to top South Coast attractions
Worth noting:
It’s not a luxury experience, but it’s perfect for a comfortable, quiet stay between stops.
Best For:
Road trippers, glacier explorers, or anyone doing a 1-night stop between Vík and the East.
4. ÖÖD Hekla Horizon
📍Location: Near Hekla Volcano in South Iceland
🔗 Visit Hotel Website
Why We Chose It:
We wanted at least one stay that felt totally unique—and the ÖÖD Hekla Horizon delivered. This mirrored glass cabin feels like a stay on another planet, tucked away in nature with views of volcanoes, fields, and possibly the Northern Lights.
Our Thoughts:
Absolutely surreal. The cabin is beautifully designed and surprisingly cozy. We made dinner in the kitchenette, soaked in the view, and felt completely off-the-grid (without actually roughing it). Our favorite part? The sauna and hot tub, which we used to unwind at the end of a long day of adventuring. This was hands down our favorite place to stay in Iceland.
Pros:
Ultra-private mirrored cabin with panoramic views
Sauna and hot tub
Modern design with high-end amenities
Once-in-a-lifetime type of stay
Worth noting:
There’s no restaurant or store nearby, so bring food to cook—or stock up before you arrive. And yes, the glass walls mean early sunrises if you forget your sleep mask, luckily they also provide blackout curtains.
Best For:
Couples, architecture lovers, and anyone wanting to feel like they’re staying in a design magazine.
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