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Top Hotels in Reykjavik Under $100: Best Budget-Friendly Gateway


After hearing about how beautiful the scenery and music festivals are, one of the first things that people learn about Iceland is its high cost. That is unquestionably the case, but there are ways to save expenses, such as by picking the appropriate lodging.

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There is no rule that says you must forgo nice amenities, locations, or style while booking one of the budget hotels in Reykjavik. Over the past few years, a number of mid-priced and low-cost hotels have popped up that either cater to a younger, more independent audience or have a simple, friendly style. Listed below are our top picks for Reykjavik’s cheap hotels.

List of Hotels in Reykjavik under $100

#1. KEX Hostel

 Skúlagata 28, 101 Reykjavik, Iceland 

Starting from $30

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Amidst the enchanting Icelandic vistas, KEX Hostel stands as a junction of contemporary ease and rustic allure. A fusion of modern convenience and industrial aesthetics, KEX Hostel has captivated travelers in pursuit of authentic Icelandic experiences.

Atmosphere and Design:

Stepping into KEX Hostel, you’re embraced by an ambiance that’s simultaneously inviting and dynamic. Housed within a refurbished biscuit factory, the hostel preserves its industrial charisma with exposed brick walls, wooden beams, and upcycled furniture. Communal spaces are thoughtfully crafted to encourage camaraderie and relaxation.


KEX Hostel provides a range of lodging options to cater to diverse traveler preferences. From private sanctuaries for a more intimate retreat to shared rooms that foster social connections, the hostel offers a comfortable and budget-friendly haven after a day of exploration.

Culinary Delights:

A distinctive feature of KEX Hostel is its culinary offerings. The onsite gastropub serves a tantalizing array of Icelandic and international dishes, crafted from locally sourced ingredients. Beyond mere dining, the restaurant acts as a hub for gastronomic exploration and connections. Whether savoring traditional Icelandic seafood or indulging in comfort cuisine, the hostel’s eatery is a culinary voyage in itself.

Events and Community:

KEX Hostel takes pride in nurturing a sense of community among its guests. Regular events such as live music performances, trivia nights, and film screenings infuse vibrancy into the atmosphere. These gatherings offer ample opportunities for travelers to bond, exchange tales, and form enduring bonds, transforming strangers into fellow adventurers.

Exploring Reykjavík:

Strategically located in the heart of Reykjavík, KEX Hostel serves as an ideal gateway for unearthing the city’s rich cultural and natural treasures. Within walking distance, iconic landmarks like Hallgrímskirkja, the Harpa Concert Hall, and the quaint streets of the Old Harbor await exploration. The hostel’s knowledgeable staff is ever ready to offer suggestions and facilitate tour bookings to uncover Iceland’s renowned landscapes, including the ethereal geothermal spas, awe-inspiring waterfalls, and the enchanting Northern Lights.


KEX Hostel also champions sustainability and environmental responsibility. Initiatives such as energy-efficient systems, waste reduction, and local sourcing underscore its commitment to being an accountable and eco-conscious accommodation choice.

#2. Bus Hostel Reykjavik – Reykjavik Terminal

Skógarhlíd 10, 105 Reykjavk, Iceland 

Starting from $40

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Situated within the bustling Reykjavik Terminal, the Bus Hostel Reykjavik stands as a dynamic and inviting accommodation option for travelers eager to explore the awe-inspiring wonders of Iceland. This innovative and thoughtfully designed hostel offers a seamless fusion of modern comfort, convenience, and connectivity, making it an ideal starting point for an unforgettable Icelandic adventure.

Central Location:

The Bus Hostel Reykjavik enjoys a prime location within the Reykjavik Terminal, a major transportation hub that connects travelers to various destinations within Iceland. This strategic position ensures easy access to transportation networks, making it a convenient choice for those arriving by bus, airport shuttle, or other forms of transport. Its proximity to transportation options streamlines travel logistics and allows guests to efficiently navigate the island’s diverse landscapes.

Contemporary Design and Comfort:

The interior of the Bus Hostel Reykjavik reflects a modern aesthetic combined with cozy elements. The hostel’s design is a marriage of simplicity and functionality, creating a relaxing atmosphere where guests can unwind after a day of exploration. The rooms are well-appointed and thoughtfully laid out, providing a comfortable space to rest and rejuvenate.

Communal Spaces and Social Vibes:

The hostel boasts well-crafted communal spaces designed to foster interaction and camaraderie among guests. The common areas provide ample opportunities to connect with fellow travelers, share stories, and make new friends. These spaces range from inviting lounges to communal kitchens, ensuring that guests can socialize, cook, and exchange travel tips in a friendly and engaging environment.

Culinary Delights:

A highlight of the Bus Hostel Reykjavik is its onsite restaurant, which serves up delectable Icelandic and international cuisine. The restaurant is more than just a place to dine; it’s a gastronomic experience that tantalizes the taste buds with local flavors and global influences. Guests can indulge in authentic Icelandic dishes or savor international favorites, all within the comfort of the hostel premises.

Gateway to Adventure:

The Bus Hostel Reykjavik’s strategic location offers easy access to a plethora of attractions and activities that Iceland is renowned for. From the majestic waterfalls to the stunning geothermal landscapes, guests can embark on guided tours or create their own adventures, knowing that the hostel’s central location will simplify their travel arrangements.

#3. Hostel B47 Reykjavik, Iceland

Situated within the vibrant streets of Reykjavik at Baronstigur 47, Hostel B47 welcomes travelers with its unique blend of warmth, comfort, and local charm.

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This inviting accommodation offers an authentic Icelandic experience, where guests can unwind, connect, and explore the captivating beauty of Reykjavk and its surroundings.

Tranquil Location:

Situated in the heart of Reykjavik, Hostel B47 boasts a tranquil location that provides both the convenience of being close to city attractions and the tranquility of a peaceful neighborhood. This balance ensures that guests can easily access cultural landmarks, shopping districts, and dining options while enjoying a restful retreat away from the urban hustle and bustle.

Quaint Design and Comfort:

The design of Hostel B47 reflects a blend of contemporary aesthetics and cozy elements, creating an atmosphere that feels like a home away from home. The rooms are thoughtfully designed to provide a comfortable and relaxing space for guests to recharge. Whether you’re staying in a private room or a shared dormitory, the hostel aims to offer a restful night’s sleep for all travelers.

Social Spaces and Community Vibes:

Hostel B47 fosters a sense of community with its well-designed social spaces. The common areas are tailored for interaction, allowing guests to meet fellow travelers, share stories, and forge new friendships. From comfortable lounges to communal kitchens, these spaces are curated to encourage a vibrant atmosphere of camaraderie.

Local Experiences:

One of the highlights of Hostel B47 is its commitment to providing authentic local experiences. The friendly staff is well-versed in the city’s offerings and is more than happy to provide recommendations for hidden gems, lesser-known attractions, and cultural events. This local insight allows guests to explore Reykjavík beyond the tourist hotspots and discover the city’s true essence.

Exploring Reykjavík:

From Hostel B47’s central location, guests can easily set out to explore Reykjavík’s rich cultural tapestry. Landmarks such as the Hallgrímskirkja, the National Museum, and the charming streets of the Old Harbor are within walking distance. The hostel’s staff can assist in planning city tours, museum visits, and other activities to ensure a well-rounded Reykjavík experience.

#4. Baron’s Hostel

47 Barónsstígur, 101 Reykjavík, Iceland 

Starting from $52

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Settled in the scenic city of Reykjavík, Iceland, Baron’s Hostel stands out as a warm and inviting haven for travelers in search of a distinctive and memorable stay. Recognized for its intimate ambiance, exceptional service, and optimal location, Baron’s Hostel has become a preferred choice among budget-conscious travelers, solo adventurers, and groups alike.

Location and Accessibility:

Positioned advantageously in the heart of Reykjavík, Baron’s Hostel enjoys a prime setting, serving as an excellent starting point for exploring the city’s renowned attractions. Conveniently located within walking distance of landmarks such as the Harpa Concert Hall, Hallgrímskirkja Church, and the bustling downtown district, guests can readily engage with local culture and immerse themselves in the vibrant surroundings. The hostel’s proximity to key public transportation hubs and major roadways further facilitates ease of access, enabling visitors to embark on day trips to Iceland’s awe-inspiring natural landscapes.

Comfortable Accommodations:

Baron’s Hostel offers a diverse range of accommodations tailored to cater to various preferences and group sizes. From shared dormitories designed for comfort and privacy, with individual bunk configurations and secure storage options, to cozy private rooms exuding a sense of homey tranquility, guests have the freedom to select the lodging that best suits their needs.

Inviting Atmosphere:

One of Baron’s Hostel’s distinguishing characteristics is its inviting and friendly atmosphere. The staff members are celebrated for their hospitality and dedication to assisting guests, whether with travel recommendations or the arrangement of tours and activities. The communal areas provide inviting spaces where travelers from all corners of the globe can connect, exchange stories, and cultivate new friendships. Whether through shared moments over cups of authentic Icelandic coffee or the exchange of invaluable travel insights, these communal spaces foster a genuine sense of camaraderie, contributing to an enhanced overall experience.

Immersive Local Adventures:

Beyond offering accommodations, Baron’s Hostel takes pride in curating immersive experiences for its guests. The staff frequently organizes events, workshops, and guided tours that allow visitors to delve deeply into Icelandic culture, art, and natural wonders. From captivating Northern Lights expeditions to enlightening walking tours through Reykjavík’s historic neighborhoods, these offerings provide guests with a unique opportunity to forge a more profound connection with Iceland’s rich heritage and breathtaking landscapes.

A Commitment to Sustainability:

Aligned with Iceland’s ethos of environmental responsibility, Baron’s Hostel integrates eco-conscious practices into its daily operations. Through initiatives such as energy-efficient lighting and proactive waste reduction measures, the hostel demonstrates its dedication to minimizing its ecological footprint, contributing to a more sustainable future.

#5. Dalur HI Hostel

In the awe-inspiring landscapes of Reykjavík, Dalur HI Hostel stands as a haven for travelers seeking a unique and tranquil experience. With its picturesque surroundings and commitment to sustainable practices, this hostel offers much more than just a place to stay.

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Dalur HI Hostel is a gateway to the unparalleled beauty of Iceland, where guests can immerse themselves in nature, culture, and authentic Icelandic hospitality.

Unparalleled Location:

Dalur HI Hostel Reykjavík is strategically situated, offering a blend of convenience and natural beauty. Located in the heart of Reykjavík, guests can easily access the city’s vibrant cultural scene, museums, and historical sites. Moreover, the hostel is just a stone’s throw away from the mesmerizing landscapes that Iceland is renowned for – from stunning fjords to captivating waterfalls and geothermal wonders.

Serene Accommodation:

The hostel provides a variety of accommodation options to suit different preferences and group sizes. Whether you’re a solo traveler, a couple, or a group of friends, Dalur HI Hostel has you covered. The cozy and well-appointed rooms ensure a comfortable stay after a day of exploration. Cleanliness and guest comfort are top priorities, guaranteeing a restful night’s sleep.

Sustainable Practices:

Dalur HI Hostel takes its responsibility towards the environment seriously. The hostel is dedicated to minimizing its ecological footprint through various sustainable practices. From energy-efficient facilities to waste reduction initiatives, the hostel strives to create an eco-friendly atmosphere. Guests can feel good about their stay, knowing that their accommodation choice aligns with environmentally conscious values.

Immersive Experiences:

What sets Dalur HI Hostel apart is its commitment to creating immersive experiences for its guests. The hostel organizes a range of activities that allow travelers to connect with Icelandic culture and nature on a deeper level. Guided hikes through breathtaking landscapes, opportunities to witness the Northern Lights, and encounters with local wildlife are just a few examples of the memorable experiences offered.

Warm Icelandic Hospitality:

Icelanders are known for their warmth and hospitality, and Dalur HI Hostel is no exception. The friendly and knowledgeable staff are eager to assist guests, providing insider tips on the best places to explore, dine, and experience the local way of life. Their genuine passion for sharing Iceland’s treasures enriches every guest’s stay.

Gateway to Adventure:

Dalur HI Hostel serves as a perfect starting point for unforgettable adventures in Iceland. Guests can embark on day trips to the Golden Circle, soak in the healing waters of the Blue Lagoon, or venture out to explore the untamed beauty of the Icelandic wilderness. The hostel’s prime location ensures that every guest’s bucket list can be checked off with ease.

Final words

When it comes to budget-friendly accommodations in Reykjavik, these hotels redefine the notion of affordable luxury. While Iceland may have a reputation for its high costs, these carefully curated options provide travelers with more than just a place to stay – they offer unique experiences that perfectly complement the breathtaking landscapes and vibrant culture of the country.

From the industrial charm of KEX Hostel to the convenience of Bus Hostel Reykjavik, the warmth of Hostel B47, the intimate ambiance of Baron’s Hostel, and the tranquil beauty of Dalur HI Hostel, each establishment brings something special to the table. Regardless of which budget hotel you choose, your stay in Reykjavik is sure to be enriched by comfortable accommodations, engaging communal spaces, and authentic Icelandic hospitality.


What amenities can I expect in budget hotels in Reykjavik?

In Reykjavik, inexpensive hotels frequently provide standard amenities like Wi-Fi, cozy beds, and private toilets. Although they might not have luxurious amenities, many of these hotels offer pristine and welcoming lodging.

Are there any hotels in Reykjavik that cost less than $100 per night?

Yes, it is possible to find hotels in Reykjavik that are affordable for less than $100 per night. Reykjavik is renowned for having a higher cost of living, but there are still a number of options accessible for tourists on lower budgets.

What are some recommendations for reducing the cost of hotels in Reykjavik?

If you want to stay in Reykjavik on a budget, think about staying in hostels, guesthouses, or low-cost hotels. Additionally, making your reservations far in advance, taking advantage of special offers, and being flexible with your trip dates can all help you obtain a good deal.

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