Top 10 Hostels in Iceland

Finding a place to stay in Iceland doesn't have to be that difficult. We collected the best top 10 hotels in Iceland, good for your sleep and your pocket!

young woman enjoying her hostel room - best hostels in Iceland

blog author By Samuel Hogarth shield verificationVerified Expert

    In the last few decades, hostels have continued to increase in popularity. They’re a great alternative to hotels or glamping in Iceland when all you want is somewhere to lay your head at night and somewhere to cook. Additionally, hostels provide the opportunity to meet lots of like-minded people; other travelers who want an adventure just as much as you do. In fact, I’ve made lifelong friends from my stays in various hostels around the world. If you are planning to hike or take road trips in a certain area, there will likely be others in the hostel who want to do the same. Connecting with others and taking these trips together only enriches the experience. The trips become chances to learn more about other cultures and gain tips for other travel ideas, both in and out of Iceland. Many great hikes I’ve undertaken have been on the advice of other travelers.

    Because of the increasing demand, European hostels continue to increase in both quantity and quality. And Iceland is no exception; there is a range to choose from, depending on your budget and what vibe you are looking for. Let’s take a look at ten options, both in the capital of Iceland, Reykjavík, and around the rest of Iceland.

    Youth Hostels in Reykjavík, Iceland

    For those who are over 30, don’t be put off by the ‘youth hostel’ label. I’ve shared hostel rooms with people from 18 up to 70, so there is no upper age limit. It all depends on how open you are to share a room and communal kitchen with several people. Some hostels do offer private rooms for a higher rate, but you can expect to still be using a shared kitchen. So, regardless of your age, if you want to interact with people from all over the world and have enlightening conversations, stay in a hostel.

    What should you expect in a Reykjavík hostel? For starters, most, if not all will have free Wi-Fi, although this is limited in some cases. Secondly, there are generally lockers in the room that are free to use, but you have to provide your own padlock. Some hostels will offer only mixed dorms, and others have the option of female-only dorms. The more people that are in your room, the cheaper the bed will be.

    Bring a sleeping mask and earplugs to prepare you for snorers and those that come in late at night. And remember, since you have chosen to stay in a communal room, to be considerate to those around you. Sometimes people sleep during the day in the rooms or just want to relax and read. Most hostels will have a lounge or bar where you can be as noisy as you want. Put yourself out there; start up conversations and see what you can learn.

    KEX Hostel is one of the most famous hostels in Reykjavík. Housed in an old biscuit factory, KEX is proud to call itself a ‘social hostel’. They have a bar and restaurant, as well as heated outdoor patios, so even when it’s cold you can sit outside and watch the world go by. They mix the vintage with the contemporary to create a brilliant atmosphere. A great place to stay for people who want to socialize and party. It’s also on the waterfront, so you have a wonderful view of the ocean and the faraway mountains of Iceland.

    HI Hostels in Reykjavík

    HI, or Hostelling International, is a worldwide group dedicated to sustainable practices and high standards. Any of their hostels offer a comfortable stay. There are three branches in the capital city, each of which offers a unique experience.

    Young woman with her hostel mates - Best Hostels in Iceland

    If you are searching for a party atmosphere, I recommend staying at Loft HI Hostel. With a mixture of live music events, movie nights, karaoke nights and pub quizzes, this hostel will give you the party you’re looking for. They even have a rooftop terrace to people watch from. If you want to stay in downtown Reykjavík but would prefer a slightly quieter experience, visit the Downtown HI Hostel. Here, you have a selection of a private room or dorm room, with private or shared bathrooms. There are also laundry facilities here, and a simple complimentary breakfast.

    You also have the Reykjavík City HI Hostel. It’s 2km away from the center, so you’ll have a little more breathing room here. If you want to venture into in downtown area, they have a bike rental service, or there is a public bus that stops out the front of the hostel. And it’s right next to Reykjavík’s biggest geothermal pool.

    Top Hostels in Iceland

    The Hostelling International chain has 35 hostels in various cities in Iceland. So, if you like the consistency of quality and environmental awareness, you have the option of staying with them wherever you go. First of all, there is the Hafaldan HI ‘Old Hospital’ Hostel, located in Seyðisfjörður, on the east side of Iceland. Yes, it has been converted from a hospital to a hostel, which gives it a quirky vibe. You can also relax in the in-house sauna after a day of exploring.

    For easy access to the Golden Circle route, stay at the Laugarvatn Hostel. It’s a short drive from Þingvellir National Park (where Iceland’s parliament meetings were held for hundreds of years) and the famous Geysir (boiling water shooting from the ground, several meters into the air). Who knows, if conditions are right, you may even see the northern lights from here. They have a hot tub too.

    There are also plenty of great places to stay that aren’t part of the HI chain. For those following Route 1 (Iceland's Ring Road) take a stop at Puffin Hostel in Vík, on the south coast. It’s a simply decorated place with a great location; only a short walk from Vík’s famous black sand beach. There is also a museum, Kötlusetur, next door to the hostel.

    If you are heading north, Akureyri Backpackers is a great hostel to stay at while enjoying Iceland’s second-largest urban area, Akureyri. It’s very affordable and provides access to those natural wonders found at the top of the island, such as Lake Myvatn.

    tidy hostel room - best hostels Iceland

    Places to Stay in the Highlands

    The Volcano Huts, located in Þórsmörk Nature Reserve in Iceland's highlands, give you a chance to immerse yourself in the country’s natural beauty. They’re very remote, only reachable by a mountain bus or by hiking. The best part is that the Volcano Huts are at the edge of the Laugavegur Hiking Trail, one of the most famous treks in Iceland. It’s not a cheap place to stay, but the experience makes it worth it.

    Another great place to stay up in the highlands is the Dalakofinn Hut. It’s very remote, again only accessible by hiking. It’s a great spot from which to visit the famous colorful rhyolite mountains or the Hekla Volcano.

    It’s worth noting that F roads (the roads that lead up to the highlands) are only open from June to September, and even then only 4x4 vehicles are permitted on them. These roads are not without their challenges, so ensure that you are prepared for a slow, careful journey up a gravel road. If you're looking for a cheap 4x4 rental, we recommend you take a look at our Dacia Duster rentals in Iceland, or find the best option for you in our selection of 4x4 rentals in Iceland.

    Samuel Hogarth, Reykjavik Cars.

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