7 Best Budget Guesthouses & Hostels In Reykjavik, Iceland

Where to stay in Reykjavik on a budget? While Iceland is an expensive country to visit, you can save by staying at a hostel. In this travel guide, I share the best budget guesthouses and hostels in Reykjavik so you can plan your trip easily.

Kex Hostel

The moment you step inside Kex Hostel, you’ll feel like you’ve walked into a living, breathing piece of art.

Its exterior, a giant grey façade, hides a secret treasure of unique design and aesthetic pleasure.

This old biscuit factory beautifully blends industrial aesthetics with warm retro touches, creating a vibe that’s as cozy as it is stylish.

A cozy room at Kex Hostel in Reykjavik, Iceland.

Every nook and cranny of Kex Hostel is filled with up-cycled furniture and delightful oddities. It’s a paradise for Instagrammers and design lovers!

The rooms exude an industrial-chic vibe, boasting stunning views across the bay that will capture your heart the minute you lay eyes on them.

Kex Hostel is one of the best budget hostels in Reykjavik, Iceland.

You can wake up to a scrumptious breakfast that’ll fuel your adventure-packed day. Choose from a range of options, including organic Icelandic jams, local cheeses, freshly-baked bread, and homemade porridge.

If you prefer whipping up your meals, Kex Hostel provides guest kitchens fully equipped for your cooking escapades.

Kex Hostel is one of the best budget hostels in Reykjavik, Iceland.

After a day out exploring, kick back at the DRINX bar. Sip on local beers, try unique cocktails, and savor the moment as you listen to jazz nights and local bands.

Guesthouse Sunna

Picture this: You wake up, stretch out, and pull open your window to a splendid view of the iconic Hallgrímskirkja.

Well, at Guesthouse Sunna, that’s not a dream but a daily reality. Located right next to the cathedral, the guesthouse is a hop, skip, and a jump away from popular cafes, restaurants, shops, and art galleries.

Guesthouse Sunna is one of the best hostels in Reykjavik, Iceland.

Each room here is spacious, bathed in natural light, and offers a window overlooking the cathedral.

The sight of this architectural marvel first thing in the morning and last thing at night is a treat few accommodations can offer. The homey atmosphere and friendly staff are just the cherry on top.

Start your day right with a delectable breakfast, including boiled eggs, oats, and cookies.

Guesthouse Sunna is one of the best places to stay in Reykjavik, Iceland.

Be sure to ask the staff for their personal recommendations on local hotspots.

And don’t forget to visit the local swimming pool and sauna to truly immerse yourself in Icelandic culture.

Igdlo Guesthouse

Nestled in a peaceful Reykjavik suburb, Igdlo Guesthouse is your key to experiencing the Icelandic lifestyle.

The rustic hostel stands out with its lovely garden – a bloom of colorful flowers and lush green trees that is an oasis of calm in the middle of the city.

Igdlo Guesthouse is one of the best budget hostels in Reykjavik, Iceland.

Every room at Igdlo Guesthouse is a fresh breath of air, with bright and airy interiors and parquet wood floors.

The mini-kitchen, where you can prepare your meals, opens up to a balcony with a view that’s worth a thousand words – the Northern Lights dancing across the sky.

Kitchen at Igdlo Guesthouse in Reykjavik, Iceland.
Mini kitchen at Igdlo Guesthouse in Reykjavik, Iceland.

There’s a traditional Icelandic breakfast every morning, complete with complimentary coffee and tea to keep you warm.

Loft – HI Hostel

If you want to make friends along the way, Loft – HI Hostel is your go-to place. This party hostel, located in the heart of Reykjavik, boasts a social atmosphere that’s second to none.

The rooms here are as colorful and inviting as the city itself, featuring comfortable private rooms or bunk beds.

Loft - HI Hostel is one of the best budget hostels in Reykjavik, Iceland.

Each room has private bathrooms and a hairdryer, with some offering heartwarming city views.

Kick-start your day with a continental buffet breakfast packed with fresh fruits, eggs, cheese, hummus, cream cheese, and fresh bread.

If you fancy something different, you can explore the numerous dining options in the surrounding area.

Loft – HI Hostel is well-known for its on-site bar and a fun-filled evening lineup. Whether it’s live music, stand-up comedy, weekly yoga, pub quizzes, or poetry nights, there’s always something to look forward to.

Loft - HI Hostel in Reykjavik, Iceland.
Onsite bar at Loft – HI Hostel.

And let’s not forget the rooftop terrace, offering beautiful views of the cityscape and nearby attractions.

B14 Hostel

For those in search of a quiet getaway, B14 Hostel offers the perfect balance of relaxation and city life.

Located close to landmarks such as Harpa and the National Museum of Iceland, B14 makes exploring the city a breeze.

B14 Hostel is where to stay in Reykjavik, Iceland.

Inside, the hostel is a serene haven, with interiors painted in calming neutral colors of black, brown, and gray. Wooden floors, intriguing paintings, and beautiful flower spots enhance the tranquil ambiance.

Rooms are minimalist yet comfortable, offering private curtains for a sense of solitude even in shared spaces.

B14 Hostel in Reykjavik, Iceland.

The common areas, featuring large sofas, offer a quiet space for focusing. Cereals and milk are free here – great for saving money.

While it’s not a party hostel, it’s located near shopping districts and lively pubs, perfect for experiencing Reykjavik’s nightlife.

Hostel B47

A seamless blend of modern-day tech and old-world charm, Hostel B47 is a haven for any traveler. Located in downtown Reykjavik at Baronsstigur, it’s the perfect base for exploration.

The moment you walk in, you’re greeted by decorations that are bound to uplift your spirits – photos of old rock stars, vibrant wall paintings, and even old musical instruments exhibited in the corridor.

The ambiance is cozy, almost making you forget you’re in the heart of a bustling city.

Hostel B47 is a budget stay in Reykjavik, Iceland.

Food lovers will appreciate the hostel’s dining area, which serves tasty food at wallet-friendly prices.

Hostel B47 is a budget accommodation in Reykjavik, Iceland.

But the culinary adventure doesn’t stop there. The hostel is surrounded by pubs and clubs that promise a delightful exploration of the city’s vibrant nightlife.

Bus Hostel Reykjavik

Step inside the Bus Hostel Reykjavik, and you’ll find yourself in a world that’s as quirky as it is charming. Once a bus garage, it’s now a trendy hostel offering an authentic local experience.

The hostel’s lounge is packed with retro furnishings, rugs, and eccentric paintings, creating an ambiance that’s both elegant and warm.

Rooms are spacious and bright with large windows, and some even come with comfy chairs, nightstands, and small lamps.

Bus Hostel Reykjavik is one of the best budget hostels in Reykjavik, Iceland.

While they don’t serve breakfast, you can still get your morning fix of Skyr, coffee, and other hot beverages. Their sweet treats, including cakes and brownies, are a must-try!

Tips for staying at hostels in Reykjavik

  • Book early: Hostels in popular areas tend to fill up quickly, especially during the peak tourist season. Make sure to book your accommodation well in advance to secure a spot.
  • Local recommendations: Take advantage of the staff’s local knowledge. They often have insider tips about the best places to eat, shop, or visit, which may not always appear in travel guides.
  • Be respectful: Remember, hostels are communal spaces. Be considerate of others by keeping noise levels down, especially during the night, and cleaning up after yourself in shared areas.
  • Pack light: Space can be limited in hostels, so try to pack light. This will make your stay more comfortable and make it easier to move around.

Frequently asked questions

What is the best area to stay in Reykjavik?

The best area to stay in Reykjavik is Midborg or downtown Reykjavik 101. 101 is the postal code for the area. This neighborhood is bustling with local attractions like the Viking-themed Sun Voyager sculpture, the iconic Hallgrimskirkja church, and the modernistic Harpa concert hall.

How much do hostels in Reykjavik cost?

On average, hostels in Reykjavik range from $30 to $60 per night. However, prices fluctuate according to seasons and availability. So, I suggest checking the hostel’s website or online booking platforms for the most accurate and current prices.

Are hostels in Reykjavik safe?

Absolutely! The hostels in Reykjavik are generally safe. As with anywhere, it’s important to follow common safety practices. Choose hostels with positive reviews and secure locker facilities. It’s always a good idea to carry your own padlocks for extra security.

What amenities can I expect at a hostel in Reykjavik?

Hostels in Reykjavik typically offer amenities like free Wi-Fi, communal kitchens for cooking, common areas for socializing, and laundry facilities. Some even have their own bars and organize social events, perfect for meeting fellow travelers and making new friends.

What to pack for hostels in Reykjavik?

When packing for your hostel stay, remember to bring a padlock to secure your belongings, a towel, earplugs, and an eye mask for those light nights during the Icelandic summer. A travel adapter is a must for charging your devices. I also recommend packing a reusable water bottle and a pair of flip-flops for communal showers.

Final thoughts

The key to an incredible trip to Reykjavik isn’t just about finding the right places to visit; it’s also about finding the right places to stay. Each of these budget hostels in Reykjavik offers its own unique experience that will enrich your journey.

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