Ring Road Accommodation Guide – Where to Stay in Iceland

A very sensitive topic – accommodation in Iceland!

*A word of warning: the accommodation situation in Iceland has gotten out of hand. As in, too many tourists and not enough places available to house them all! It is now extremely important to reserve your lodging faaaaaaar ahead of time if you’re traveling to Iceland. ESPECIALLY Reykjavik and the South coast. I’m talking up to 6 months to a year in advance! Because if you don’t, you run the risk of NOT having a place to stay – like zero options remaining, OR paying upwards of $500+ USD for a room. FOR ONE NIGHT.

Yeah, like I said: out of hand.

But like the good planners and researchers you are, you won’t have to worry about that problem!

Obviously, the Ring Road is an awesome way to see some of the best sights around Iceland. In my opinion, there’s no better way to see Iceland than renting a car and driving around the country!

Don’t forget to book your rental car!
Get 5% off your total at Blue Car Rentals. Use code: #LWV at checkout for a discount!

I’ve rounded up places to stay around the entire Ring Road to help you choose the best place for your travel needs.

Each location includes options for three price points – budget: hostel, average: guesthouse, and luxury: hotel. I always try to give you information on places I’ve personally experienced, so I’ve marked the places I’ve stayed at with an *.

How to search for Iceland Accommodation

Accommodation Types

Iceland Hostels

  • Dorm-style sleeping arrangements, private rooms sometimes available but at a higher rate
  • Shared communal spaces and bathrooms
  • Kitchen for cooking your own food
  • Bring your own or pay extra for bedding/towels

Iceland Guesthouses

  • Simple rooms in a private home
  • Private rooms, shared or private bathrooms
  • Personalized service
  • Sometimes a kitchen for cooking, sometimes not
  • Often includes breakfast, but could be an extra fee

Iceland Hotels

    • Hotels are pretty standard
    • Private rooms, private bathroom
    • No options for cooking, but usually have a restaurant on site.
  • Even though there are some nice hotels in Iceland, “luxury” probably don’t match up to worldwide standards


Reykjavik is the capital of Iceland, and other than it’s charming, quirky feel, it hosts a great restaurant scene. No wonder travelers opt to spend 1-3 nights in this beautiful city. You’ll find LOTS of options for accommodation ranging from luxury hotels to small guesthouses. Some people even choose to stay in Reykjavik and do day trips out of the city!

READ MORE:   Vik Travel Guide | South Iceland

Golden Circle

The Golden Circle is the most popular route in Iceland, and definitely one you don’t want to miss! The main attractions are Thingvellir National Park, Geysir, and Gullfoss waterfall. While the Golden Circle can be done in a day, it’s nice to have accommodation close by to leave more time for sightseeing!


Hardly anyone comes to Iceland without going to Vík. Famous for its black sand beaches and basalt columns spiking out of the ocean, it’s easy to see why travelers make their way down the coast. Not to mention that church overlooking the colorful homes – it’s a pretty Instagrammable town!


After Vik, the next big town is Hofn. The main stops along the way are Jokulsarlon glacier lagoon and Vestrahorn. There is a lot of ground between these two places, so I often times suggest staying in the middle to cut down driving time.

Grocery Store Prices
19 Easy Ways to Save Money in Iceland

East Iceland

The East is a breathtakingly gorgeous part of Iceland – one of my favorites, in fact! Unfortunately the Ring Road cuts off the fjords, but still leaves plenty to see along the drive. A good stopping point is Egilsstadir, the main town in the East.


Myvatn is a very diverse region of Iceland with lakes, geothermal areas, and craters. There is a LOT to see in this area, so I suggest staying right around the lake.


The second largest city in Iceland and know as the capital of the north, Akureyri is a city that sits in the middle of a large fjord. This area has some of the most beautiful mountains in the country and provides a break from the countryside from the rest of the Ring Road (for those looking for some good restaurants and night life!)

Snæfellsnes Peninsula

Known as “mini-Icealnd” the Snaefellsnes peninsula is home to a diverse landscape of mountains, fjords, lava fields, and glaciers. The main attraction is Mount Kirkjufell and the waterfalls.

Planning a trip to Iceland?

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*To help me keep making great videos and posts throughout the year, reserve your accommodation through my affiliate link. It’s no extra cost to you and a big help for me to show you new ways of planning the best trip ever!

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  • Steph
    August 22, 2017 at 6:11 pm

    We stayed at mostly Icelandair hotels and loved them. I’ll have to look up where we stayed in Hofn because that wasn’t the same brand of hotels and it was hands down the most beautiful place I’ve ever stayed. Eeeeek! I can’t wait to make another trip here.

  • Pam
    August 21, 2017 at 10:27 pm

    Just an FYI – I just tried the discount code for Blue car rentals and it didn’t work. I’ll check with them later to be sure but it didn’t show up on the receipt.

    • Jeannie
      September 9, 2017 at 12:44 pm

      Thanks for your message Pam. I checked with them and there seemed to be an issue if you used #BlueLWV vs #BLUELWV. This has now been resolved, hope that helps!

  • Rosie
    August 18, 2017 at 1:43 pm

    I visited Iceland last December, and we booked our AirBnB about 10 months in advance. We had a great little place in Reykjavik that was so, so much cheaper than hotels and it was about a 10 minute walk into the city centre. Most of the hotels we looked at were so expensive, even for the most basic ones.

  • Amanda
    August 16, 2017 at 2:54 pm

    I heard recently that Iceland is having a hard time keeping up with the tourists! Craziness. I was there back in 2014 and it must have been before the chaos. I didn’t feel it was too busy, and we had no issues finding places to stay. We only booked one hotel for our first night, and the rest of the time we stayed in Airbnbs. It worked out well! Seeing these photos of Iceland makes me want to go back so badly. <3 It's good to know we should plan way ahead of time if we do return!

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