The 7 Best Hotels
in Reykjavik
Reykjavik's hotel scene arrived late and then moved fast. A decade ago the city ran on guesthouses and mid-range chains; today it has its first proper 5-star property on the old harbour front, a Danish organic boutique brand with a geothermal hot tub in the garden, and a pod hotel concept that most European capitals still don't have. The transformation tracks Iceland's tourism surge almost exactly — and the quality across price points is now strong enough to be genuinely selective.
One thing that doesn't change: Iceland is expensive. A €150 room in Reykjavik is a mid-range room, not a luxury one. The compensation is that the gap between price tiers is compressed — a €100 budget pick here delivers cleaner design and more thoughtful service than a €100 room in most Western European capitals. Factor in that almost every hotel on this list is within 3 kilometres of the centre, which in a city this walkable means you're never far from Laugavegur, Hallgrímskirkja, or the old harbour.
We narrowed the qualified pool of 17 Reykjavik hotels (each with a Google rating of 4.5 or above and at least 50 verified reviews) to seven — two splurges, three mid-range picks, and two budget finds. Each was chosen for a specific reason beyond competence. Use the list on the right to jump to the right pick for your trip.
The Reykjavik EDITION
Reykjavik's first 5-star hotel — 253 rooms on the old harbour at Austurbakki 2, with Mount Esja filling the view across the water and a full spa that takes Iceland's geothermal tradition seriously rather than just gesturing at it. Part of Marriott's EDITION lifestyle brand, it brought a level of food and beverage programming the city previously had to import: Tides Restaurant runs breakfast through dinner with harbour views, and the bar draws a local crowd on weekend nights. Service is the most consistently polished on this list.
- First 5-star hotel in Reykjavik
- Harbour-front location at Austurbakki 2
- Tides Restaurant open breakfast to dinner
- Full spa with geothermal-inspired treatments
Tower Suites Reykjavík
Eight suites on the 20th floor of Katrínartún 2 — one of the tallest buildings in the city — each with full 360° panoramic views taking in the ocean, Esja mountain, and Reykjavik's corrugated-iron rooftops in every direction. No two suites are identical; each has its own layout and character. The altitude alone makes this different from everything else in Reykjavik, and the northern lights visibility from this height on a clear October night is, by most accounts, the best available from inside the city.
- 8 suites on the 20th floor — highest rooms in Reykjavik
- 360° panoramic views: ocean, Esja, city rooftops
- Each suite has a distinct layout and character
- Northern lights visibility from the room on clear nights
Eyja Guldsmeden Hotel
The Reykjavik outpost of Denmark's Guldsmeden group, a boutique brand built around organic materials and a wellness philosophy that predates the word becoming overused. The hotel has a geothermal hot tub in the garden, an organic breakfast sourced locally that takes a serious 45 minutes to eat properly, and rooms with ocean and Esja mountain views — a combination the city's larger hotels struggle to match at this price point. Brautarholt 10 is a 12-minute walk from Laugavegur, quiet enough to sleep.
- Geothermal hot tub in the garden
- Organic locally sourced breakfast included
- Ocean and Esja mountain views from rooms
- Danish Guldsmeden group — consistent quality across cities
Sand Hotel by Keahotels
A 78-room boutique directly on Laugavegur 34 — the city's main street for restaurants, bars, and independent shops — with Scandinavian-palette rooms in warm woods and neutral tones, a terrace with city views, and the consistent service quality that Keahotels, the largest Icelandic hotel group, has built its reputation on. The location is the primary argument: equidistant from the old town to the west and Hlemmur square to the east, nothing in Reykjavik requires more than a 15-minute walk.
- Directly on Laugavegur — best street location on this list
- 78 rooms with Scandinavian design palette
- Terrace with city views
- Keahotels — largest Icelandic group, consistent service standard
Hotel Reykjavik Centrum
A hotel on Aðalstræti — the oldest documented street in Reykjavik — sitting directly above the Reykjavik 871±2 Settlement Museum, where Viking-age longhouse foundations dating to around 871 CE are preserved under glass in the basement. The corrugated-iron facade is a deliberate reference to the building style that defines the old town; the 89 rooms are modern inside. This is one of the few hotels in any city where the ground beneath the lobby is a genuine archaeological site.
- Directly above the Reykjavik 871±2 Settlement Museum
- Viking longhouse foundations preserved on-site
- On Aðalstræti — Reykjavik's oldest street
- Corrugated-iron facade referencing old town architecture
Midgardur by Center Hotels
The most-reviewed hotel on this list — 1,828 Google reviews at 4.6 — positioned at the eastern end of Laugavegur, directly across from Hlemmur food hall. Three room tiers at different price points share the same central address and the same front desk reliability that Center Hotels, Reykjavik's longest-established mid-market group, applies across its properties. The breakfast is included at higher tiers and worth accounting for in the overall cost calculation: Icelandic breakfasts trend substantial.
- 1,828 Google reviews — most reviewed on this list
- Three room tiers at different price points
- Across from Hlemmur food hall
- Center Hotels group — Reykjavik's most established mid-market operator
CityHub Reykjavik
Private sleeping pods with app-controlled lighting, sound, and room service — the CityHub concept treats the shared lounge, bar, and social spaces as the real product, and the pod as the place you sleep. Hverfisgata 46 is one street north of Laugavegur and a 10-minute walk from the old harbour. Each pod is genuinely private, not a dorm configuration; the CityHost app handles check-in, city recommendations, and late checkout requests without a front desk queue. The 4.8 Google rating on 245 reviews — the highest raw rating on this list — reflects a consistently delivered, well-thought-out experience.
- 4.8★ on 245 reviews — highest rating on this list
- App-controlled private pods — not a dorm
- Generous shared lounge, bar, and social spaces
- One street north of Laugavegur, 10 min walk to old harbour
How we chose these hotels
Our editorial team reviewed the full hotel landscape across Reykjavik and selected seven across budgets: two splurges (the EDITION for full-service harbour luxury, Tower Suites for altitude and views), three mid-range options (Eyja Guldsmeden for organic boutique credentials, Sand Hotel for location on Laugavegur, Hotel Centrum for historical layering), and two budget picks (Midgardur for reliability and review volume, CityHub for the most innovative low-cost concept in the city).
None of these hotels paid to be included, and we have no commercial relationship with any of them. Hotel websites linked above are official direct-booking pages. Prices are estimated nightly ranges in EUR for a standard double room and will vary by season and availability — Reykjavik rates fluctuate significantly between the summer peak (June–August) and the quieter winter months.
When to visit Reykjavik
June through August is the midnight sun season — days are essentially endless, the city is at full volume, and prices peak. September through November offers the northern lights without the deep cold of winter and is the most balanced time to visit. December through February is genuinely cold (regularly below -5°C) but the aurora visibility is highest and the city's thermal pools — including the recently opened Sky Lagoon at Kársnes harbour — feel appropriate rather than optional.
For everything else — neighbourhoods, food, day trips to the Golden Circle and the South Coast — see our complete Reykjavik travel guide.