Iceland’s accommodation options are quirky at best and incredibly pricey at worst.

Thanks to the recent influx of tourism, though, there are usually at least a few options to choose between.

In this Iceland accommodation guide, we’ll take a look at everything you need to know so you can make the best decisions.

Wherever you decide to travel in Iceland, the accommodation will be pretty similar and different all at once.

If you’re staying in multiple towns, there are certain themes you’ll notice throughout all of them, but each still come with its own quirks and difference.

Here’s what to expect – and what you need to know – when planning an Iceland trip.

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What you need to know about accommodation in Iceland

As with anything travel-related, it helps to know a little about what you’re getting yourself in for before you go.

And when it comes to accommodation in Iceland, you’re probably in for at least a few surprised – and not just because of the prices!

Here’s what to expect when booking (and staying in) your Iceland accommodation.

The showers are the best

Let’s start with the good news, shall we? I would bet 100 Króna that the showers you have in Iceland will be among the best showers you have in your entire life.

Icelandic showers are generally of the waterfall variety, usually with a second shower head that you can hold by hand. They’re usually pretty powerful, too, which makes hair washing more enjoyable than usual. I think Iceland may well be the only country where I’ve had to turn the water pressure down!


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Your water is heated naturally

Iceland is a country with high geothermal activity, and that means most of the water you use will be heated that way.

This isn’t just good news for your travel carbon footprint.

It also means you never have to worry about getting hot water because the hot water is always pumping.

When you’re in a country that gets as Iceland does, it’s a true blessing to come home to – especially if you’re visiting Iceland in winter.

You’ll never appreciate a hot shower more than after a long day of chasing waterfalls in the wind and hail.

You’ll know you’re in Nordic territory

Most Icelandic hotels wouldn’t look out of place anywhere in Scandinavia.

They have everything you’d expect of a Scandi room: functional furniture, minimalist features and a layout that just works. 

They all come with (powerful!) heating systems and everything you need for a hygge night.

If you book a double room, expect twin beds pushed together rather than one large double bed. And if you do find a double bed in your room, you can be sure there will be two separate duvets.

RELATED READ: Already been to Iceland? Now try the Lofoten Islands.

Sometimes they have a northern lights wake up call

Some hotels in Iceland have a free northern lights service. If the northern lights appear, they’ll call your room free of charge.

That means you never have to compromise on sleep or experience.

You can sleep FOMO-free, knowing that someone will wake you up if there’s anything worth waking up for.

The lobby might be a lot nicer than the room

Most of the hotels in Iceland have really incredible lobby areas.

You’ll usually find a well-lit reception area, sofas and seating areas, and oftentimes a bar. One hotel we stayed in even have cute swinging chairs hanging from the ceiling!

Just don’t expect the same extravagance in your room.

While most hotel rooms in Iceland are nice, they’re also fairly basic and made to be functional rather than photo-worthy.

Still, it’s nice to have a cool place to hang out in the hotel – and the lobby is usually where the WiFi is best, anyway!

Hot tubs and saunas are fairly common

Not every hotel in Iceland has its own hot tub or sauna, but many of them do. There’s nothing better than braving the icy air for a few seconds before jumping into the warmth. If you’re lucky enough to get northern lights, I can’t imagine a better place to watch them from!

You won’t be spoilt for choice

Iceland has enough accommodation to go around, but not nearly as much as you’d expect for such a tourism-heavy destination.

Which is good news if you struggle with serious travel decision fatigue – Iceland may be your easiest trip yet.

You won’t have to worry too much in Reykjavik, where there’s a good variety of accommodation options.

In some towns, though, you might only have a choice of one or two hotels.

Breakfast is nearly always included

Almost every hotel in Iceland includes breakfast, and it’s usually pretty generous.

Expect a buffet of bread, meats and fish, along with fruits, vegetables, jams and yogurts. Pretty much your standard breakfast buffet.

Even the smallest hotels usually offer both hot and cold breakfast options, as well as tea, coffee and juices.

The WiFi is usually open

You rarely need to worry about bashfully asking for the WiFi password in Iceland because it will usually be open or displayed somewhere super obvious.

Generally speaking, it’s also pretty fast – Iceland has some of the fastest internet speeds in the world.

We stayed in about 8 hotels in total and only one of them had terrible WiFi – and, even then, it worked pretty well in the lobby area.


Stay connected throughout your trip with SkyRoam pocket WiFi.

This handy little device will give you unlimited data so you’ll never be without maps, emails and a way to contact home.

Bring your own toiletries 

Miniature toiletries are usually a given in hotels, but not in Iceland!

You should find soap, shower gel and maybe some shampoo in your room, but never expect anything more. 

I generally like to travel with my own products anyway because it’s better for both my hair and the environment.

But if you usually depend on those miniature bottles, you’ll want to prepared for this trip.

The rooms are pretty dark

I have no idea why but hotel rooms in Iceland are dark.

If you’re travelling to Iceland in January, be prepared for this.

There just isn’t much lighting and, even when there is, it’s usually placed in a pretty inconvenient way. Even the nicest hotels we stayed in were like this – and they were sometimes the worst!

Maybe it’s just how Icelanders like their rooms. I guess you could even call it mood lighting. But really it’s just bizarrely placed lights.

Accommodation in Iceland

Choosing the best Iceland accommodation

Despite its rank as one of the most popular travel destinations right now, Iceland doesn’t have an overwhelming amount of accommodation to choose from.

Like anywhere, there are several standard options to choose from.


Hotels are the common type of accommodation in Iceland. Most of them are pretty similar – basic, but modernly furnished – and around the $100-200 price mark. 

Apart from a couple of exceptions – like The Retreat at the Blue Lagoon – luxury hotels don’t really exist in Iceland. I guess there just isn’t a demand for it!

Most hotels are fairly small, boutique-style hotels that offer a very comfortable stay.

Although international chain hotels are pretty much non-existent in Iceland, there are several hotels chains with multiple properties across the country.

If you plan on travelling the entire ring road, you will probably end up staying in at least one of these – sometimes they’re the only option! 

The chain hotels we stayed in were all very modern and comfortable, so it might be worth sticking to them if you want peace of mind when booking.

The most popular chains are Fosshotel, Icelandair and Keahotels.


If you fancy something a little more personal, Iceland has plenty of guesthouses.

They’re generally smaller than the big hotels and often found on farmlands – which is why they’re sometimes called farm stays.

Guesthouses can vary from one house with several guest rooms, to larger sites with multiple buildings.

Sometimes they come with living room-style areas and kitchens, too, so it could be a good option if you like to prepare your own food (or coffee!).


If you plan to spend a couple of nights or more in Reykjavik, an apartment can offer a little more space.

They tend to be more affordable than a hotel, too, so staying in an apartment could also save you some money.

We stayed in two different apartments in Reykjavik and really liked them.

The WiFi was fast, the locations were perfect and they provided a full set of toiletries in the bathroom.

They were also both easy to check in to, too, with a dedicated reception and staff on-hand should you need anything.


Like most places, Airbnb is always an option too.

It’s a good way of finding more affordable accommodation if you’re on a budget, but it’s very limited outside of the cities. If you can find somewhere that’s free, it’s a great way of getting a more local experience!


If you’re prepared to brave the unpredictable weather, camping is also an option in Iceland.

There are campsites all over the country where you can pitch a tent for a very reasonable price, but it’s probably something you’d only want to do in the summer.

It can get incredibly cold in the winter – not to mention the noisy winds and rain!

Renting an RV

If you want both comfort and convenience, it’s easy to rent an RV in Iceland. It’s a great way to see the country, especially if you’re a fellow photographer or want to travel the ring road at your own pace. has everything from full-size family motor homes to smaller Toyota Hilux campers.

Reykjavik in January Iceland

Iceland accommodation tips

A few more things to keep in mind before you book…

Always book before you arrive.

Unlike other places, where you can rock up and find a room, you’ll want to book your Iceland accommodation in advance.

Rooms book up quickly, so book as soon as you’re ready.

Bring a credit/debit card with good international rates.

Iceland is a virtually cash-free society. You could probably get through your entire trip without a single coin or note!

It makes it really easy to pay for things – and avoids the need to withdraw money constantly – but don’t get caught out on bank fees.

Make sure you come prepared with a card that has a good conversion rate and minimal fees.

RELATED READ: If you’re interested on which cards and accounts I use as a full-time traveller, I wrote an entire post on the topic here.

Make sure you pack the right adapters. 

Like most of Europe, Iceland uses plugs with two round prongs.

Make sure you pack an adapter if you have electronics that have any kind of plug.

You may also want to pack a multi-plug or multi-USB plug (or one like this which combines the two!) because there can be limited plug sockets.

Don’t forget your travel insurance.

The one thing you should never leave without (apart from your passport!), you’ll want to make sure you have adequate cover for Iceland.

The unpredictable weather can cause flight delays and other disruptions, so make sure you’re covered should anything go wrong.

I use World Nomads because they cover adventurous activities (like glacier walking!) that other insurers won’t. You can read more about why I recommend them in this post or get an instant quote below:

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iceland accommodation guide