3 Ways to Not Blow Your Budget on Accommodation in Iceland

In this post I will focus on my experience at hostels, camp sites and an Airbnb flat, during our nine day trip to Iceland in early September, in Reykjavík and the South. 


Iceland is very different from Spain and Portugal where I have spent the best part of 2015 so far. Finding excellent hostels for weekends away affordably there had been painless. For an equivalent in Iceland, we were looking at 60€/night – quite the contrast. Even so, many places en route outside of Reykjavik are quite isolated with few options and thus even more expensive.

We ended up booking a stay at Hlemmur Square, a hostel on the main street. It worked out at about £25/night which ‘isn’t bad for Iceland’ and we were lucky enough to get our own private room. Breakfast however is not included, but you can pay for it as an extra (£9 which was quite expensive). It is a continental breakfast though, and we opted to do this the day we left for the Golden Circle, to fill up on lots of food! Alternatively, walk across the street and pick up breakfast from the convenience store.

If you are looking for somewhere affordable to stay in Reykjavik with a comfortable bed, then this hostel is the place, but it isn’t somewhere I’d rave about.

There is also a camp site in Reykjavik, so if you’re looking to save even more money than a hostel, you know where to go.

Camping in Iceland

The camping season in Iceland ends with the summer tourist season (31st August) according to online tourist information. Our travel dates were the 3rd-11th September but we managed to make it work! We were expecting to be camping out of season, in closed campsites (no services – running water, toilets etc.) or maybe even wild camping, as this is actually allowed in certain areas of the country (not in National Parks). Yet after much research, I managed to find a small list of campsites open during our trip, that were still open! We spent four nights camping and every time, we were at open campsites, with facilities and even quite a few other campers (we were not the only crazy ones!).

The average price per person was about 1200-1700ISK/night, which works out at roughly £7. And a 200-400ISK add-on to have a hot shower. Paying £7/8 for accommodation each night was much better than paying the price of hotels/B&Bs!

Still, after four nights of camping in the wet, the ferocious wind and the unforgiving cold, despite our thermals, thick sleeping bags and sleeping bag liners, we were so relieved to arrive at our AirBnB accommodation in Keflavik, near the airport, where we would spend our final two nights in luxury.

Whenever we told people that we had been camping, they would look at us like we were crazy. They were probably right. The weather was particularly bad during our trip. If I could return to Iceland in the future, I would invest more in my accommodation and stay in hotels or B&Bs, anywhere that isn’t camping. When you’re out and about in the cold all day, doing adventurous activities such as snorkelling or glacier hiking like us, what you really need is a nice, warm, comfortable bed to sink into at the end of the day, not a hard sleeping mat in a tent you fear is going to blow away with the wind!

Still, I’m pleased that for this trip we did go camping, as we saved so much money and put it elsewhere to do some incredible things! Below I have listed the campsites we used:

  • Geysir Camp Site

On the Golden Circle and within walking distance of Geysir and the shop and cafés. Click here for the Official Website

This was my favourite campsite. The shower and toilet areas were spotlessly clean and we were so close to all the amenities at Geysir. The lady who runs it is friendly and welcoming.

  • Vik Camp Site (two nights here)

Very close to the Gas Station where you can eat at the café (amazing burgers!). Easy to find when you arrive in town thanks to signposts.

The toilets and showers were much less clean here. There is a room where you can eat and cook food in the hut, but there were limited tables and it was very busy. There is free WIFI though!

Vik is the rainiest place in Iceland, and it sure did rain. On our final night here, the wind was exceptionally bad. Amazing views over the mountains though. It was the most scenic campsite in my opinion!

Click here for their TripAdvisor page

  • Skaftafell 

Glacier in Skaftafell

How often to you get to camp near to a glacier? This was also a very scenic campsite but also a little bit chillier for obvious reasons.

Very close to the Visitor’s Center and the starting point to hike to Svartifoss (Black Waterfall), which we did on our final morning there. Free WIFI in Visitor’s Center.

The ground is very bad to pitch a tent in, which is ridiculous as it is a campsite!

Facilities are good, however you have to buy a shower card to use the showers, which you have to pay for with your debit/credit card, no cash allowed. It is 500ISK per shower, the most expensive one we encountered AND the hot water only lasts 5 minutes, which we were not impressed with at all. Maybe stay at the hotel down the road or use a campavan.


After the horror of our camping episode, (well, it wasn’t that bad, but we were relieved that it was over!) we arrived at our Airbnb accommodation, excited to return to civilisation, central heating and a real mattress. Our hosts were the most welcoming Airbnb hosts I have been lucky enough to stay with and I could not recommend them highly enough. I would 100% go back to stay with them if I could go back to Iceland.

The kitchen had been stocked for us with yogurts, milk, cheese, fresh juices, cereal bars, fresh fruit, a selection of breads, hot drinks, nutella… it was like looking into heaven! Never had an Airbnb host been so generous with food. After only surviving on snacking and an average of one proper meal a day (due to the lack of food services during our trip), we couldn’t be more grateful. We were even able to air our very wet tent in the garage to dry. As you can see, they went out of their way and were extremely hospitable.

If you would like accommodation near Keflavik airport during your trip to Iceland, I would obviously recommend this place. Here is the link to ‘Natalia Home guesthouse,’ which is rated 5* on Airbnb


Of course, these are not the only budget options when travelling to Iceland. Hiring a campervan or Couchsurfing both come to mind. I hope this post helps some readers who might be thinking about planning a trip to Iceland and looking for budget accommodation for their trip around the Golden Circle and the South.


3 thoughts on “3 Ways to Not Blow Your Budget on Accommodation in Iceland

  1. Pingback: Hiking on a Glacier | Robyn Bobbing Around

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