When it comes to raw natural beauty – it’s tough to beat Iceland

With hundreds of accommodation options (and many of them very expensive), it can be difficult to know exactly which hostel to stay, which is why I wrote this list of the 20 best hostels in Reykjavik.

Organized by YOUR travel needs, this list of 20 best hostels took a bunch of things into consideration, so you can find which hostel best suits you, and you can get on exploring this incredible country.

So whether you are looking for a place to party, or the cheapest bed to grab a good night’s sleep – our list of the 20 best hostels in Reykjavik and Iceland will get you where you need to be!

Let’s do it.

Quick answer: The best hostels in Reykjavik

What to Expect from Hostels in Reykjavik

Hostels are generally known to be one of the cheapest forms of accommodation on the market. That doesn’t just go for Reykjavik, but pretty much every place in the world. However, that’s not the only good reason for staying at a hostel. The unique vibe and social aspect is what makes hostels TRULY special. Head down to the common room, make new friends, share travel stories and tips, or just have a great time with like-minded travellers from all over the world – you won’t get that opportunity in any other accommodation. 

Best Hostels in Reykjavik

If you want to be a backpacking master, the most important parts of picking a hostel are 1) making sure it’s within your budget and 2) making sure it suits your personal travel needs. This is why I split up the best hostels in Iceland and Reykjavik into a few different categories. You can decide what’s more important to you (partying, saving money, privacy, space to work) and easily book from there!

Some other things I took into consideration…

  • Location – This wasn’t too difficult. Iceland is small. Reykjavik is smaller. While it can be challenging to get around without a car, the island as a whole is fairly compact, and all of the hostels are in places you’d hope they’d be – near the sights!
  • Price – Unfortunately, for all of it’s nature-glory, Reykjavik is a premium destination and it comes at a premium price. Expect to drop around $50 a day, and much more if you are not careful about where you eat. Plan your food as strategically as possible, because restaurants are not cheap.
  • Amenities – The Reykjavik hostel scene is a bit on the stingy side… Not a lot of freebies, so try and save money where you can. A few hostels did offer free (or cheap breakfast) so try and pinch a penny where you can.

Reykjavik, and Iceland in general, is known for being a pretty pricey place to explore. Securing budget accommodation is, therefore, of particular importance to backpackers who want to enjoy the varied attractions and activities without breaking the bank.

When looking for those budget accommodations, you’ll find the best options on HOSTELWORLD. This platform offers you a super safe and efficient booking process. All hostels are displayed with a rating and previous guest reviews. You can also filter your personal travel needs easily and find the perfect place for you.

Things DO go missing sometimes…

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The 5 Best Hostels in Reykjavik and Iceland

We’ve split Reykjavik’s best hostels into different types, such as best hostel for solo travellers, best hostel for couples, and best hostel for digital nomads, to make your final choice easier.

1. Overall Best Hostel in Reykjavik – Kex Hostel

Kex Hostel best hostels in Reykjavik
Kex Hostel is our pick for top hostel in Reykjavik
  • $$
  • Restaurant/Café/Bar
  • Tour Desk
  • Bike Hire

Solid all-around, Kex Hostel is our pick for the overall best hostel in Reykjavik. It has awesome facilities and modern rooms with an industrial-chic vibe, with a choice of private rooms and dorms for four, six, and 16. Sleeping up to 200 guests, there are heaps of potential new buddies to bond with.

Close to central Reykjavik restaurants, nightlife, shops, and attractions, the sociable onsite bar-cum-restaurant might tempt you to stay indoors some nights too. Unwind on the patio, kick hunger to the curb in the kitchen, stay connected with Wi-Fi, and plan your Icelandic travels at the tour desk. Other bonuses include laundry facilities, bike hire, a book exchange, and luggage storage.

Why you’ll love it here:

  • Super central location
  • Two kitchens
  • Instagram-worthy design

You’ll find KEX Hostel in the centre of Reykjavik in a buzzing area packed with cafés, bars and music venues. Browse handmade items in the boutiques, learn about Iceland’s history in one of the museums or relax in a geothermal swimming pool. Any art lovers out there? The National Gallery of Iceland is just a 20 minute walk away too.

Once you’re done exploring, head back to the hostel and chill in one of the social areas with your fellow backpackers. It’s the perfect spot to exchange some travel stories. Hungry after a long day? No problem, simply head to one of the two kitchens and prepare a tasty three-star meal! There’s so much space and equipment that even the heftiest dinner can be served up with ease.

2. Best Hostel for Solo Travelers in Reykjavik – Laekur Hostel

Laekur Hostel best hostels in Reykjavik
Laekur Hostel is one of the best youth hostels in Reykjavik
  • $$
  • Bar/Café
  • Luggage Storage
  • Steam Room

Laekur Hostel has comfortable dorms for four, six, and eight, all beautifully decorated in a traditional Nordic style. Located in a quiet and high-class area, the stylish youth hostel in Reykjavik is just a short walk from many of Reykjavik’s major attractions.

Sociable travellers can mingle in several awesome common areas, and there’s a communal kitchen where you can save money by cooking your own meals. You don’t even need to worry about doing your dishes afterwards—there’s a dishwasher! If you really can’t be bothered cooking, however, there’s an onsite café-cum-bar. Wi-Fi is free and lockers are provided.

Why you’ll love it here:

  • Super homely vibes
  • Bright rooms
  • Family-room options

There aren’t many hostels in the world where you walk in and instantly feel like you’re at home – Laekur Hostel is one of those! Thanks to the charming nordic style, really cool common areas and some of the kindest staff you’ll ever meet, staying here is a solo travellers dream come true!

Each bed, no matter if dorm or private room, is equipped with a small reading lamp and an international plug socket to keep your electronics charged! The beds themselves are pretty simple, yet stylish and very comfortable according to previous guests. If you happen to bring your family or friends on the next trip, you can even opt for the family room options.

3. Best Cheap Hostel in Reykjavik – Galaxy Pod Hostel

Galaxy Pod Hostel best hostels in Reykjavik
Japanese-esque, Galaxy Pod is our top hostel for solo travelers in Reykjavik
  • $$$
  • Onsite Bar/Café
  • Key Card Access
  • Elevators

One of the best cheap hostels in Reykjavik, Galaxy Pod Hostel provides all the facilities you would expect from a top hostel, and has a sociable vibe, but allows plenty of privacy come bedtime. A brilliant option for travellers who are completely over clambering up ladders and sleeping in bunk beds, Galaxy Pod Hostel has cool little pods, each with a power outlet, light, mirror, shelf, hangers, and alarm clock.

They’re like tiny capsule hotel rooms (almost!). Communal areas include a TV room, lounge with PS3 and Wii, bar, and kitchen, providing plenty of opportunities for lone backpackers to meet and mingle.

Why you’ll love it here:

  • Cool design
  • Fully equipped kitchen
  • Epic views from the common room

It might feel like you’re sleeping in a funky Japanese hostel, but you’re actually 10min from centre of Reykjavik. It’s also outside the pickup restriction zone (we don’t really know why it’s forbidden to pick someone up) so pick up’s are right in front and parking is free. The hostel offers single or double space pods instead of regular bunk beds in shared dormitories and also provides lockers in all of rooms.

Plenty of previous travellers have enjoyed their stay here, and all of them were very impressed with how much bang you’ll actually get for your buck! Privacy, clean sheets, cool common spaces, great views of the city and even a bar… the list of why this hostel is truly epic goes on. No matter what kind of traveller you are, Galaxy Pod Hostel will make you fall in love with the place!

4. Best Party Hostel in Reykjavik – Reykjavik – Loft HI Hostel

Reykjavik – Loft HI Hostel best hostels in Reykjavik
Loft HI Hostel is the best party hostel in Reykjavik
  • $$
  • Bar/Café
  • Games Room
  • Steam Room

Although the Icelandic capital isn’t really known for its wild nights of hedonism (it’s generally too freaking pricey!), the energetic award-winning Reykjavik – Loft HI Hostel is one of the best party hostels in Reykjavik. Head to the bar for happy hour each afternoon and join in with fun events like karaoke sing-alongs, music performances, extravagant drag shows, quizzes, and more. There’s something for hippies-at-heart too, with yoga, crafts, and similar.

Socialise and relax in the lounge, with board games, foosball, a book exchange, and free-to-use computers, soak up the views from the roof terrace, and cook up a meaty feast on the BBQ. Wi-Fi is free and the hostel has a tour desk and laundry facilities.

Why you’ll love it here:

  • Free events
  • Rooftop terrace
  • Happy hour

You simply can’t NOT like the Scandinavian interior design. It’s clean, it’s welcoming and still very modern – the perfect place to call home for a couple of nights. Fall asleep in one of the super comfy beds (we’re quoting previous guests here) in one of the spacious dorms or charming private rooms.

if you’re visiting during winter, be sure to head up to the rooftop terrace at night to see the Northern Lights! It’s an incredible thing watch and it’s even better if you can experience it with one or two of your bunk bed buddies.

Speaking of, you’ll have absolutely no problems making new friends at Loft HI Hostel! A quick drop in at the common room will give you the chance to chat with like-minded travellers, exchange cool stories. And maybe come up with some new travel plans. If you need some inspiration on what to do in Reykjavik, simply stop by at the reception and ask the friendly staff for some insider knowledge.

5. Best Hostel for Digital Nomads in Reykjavik – Bus Hostel

Bus Hostel best hostels in Reykjavik
Spacious common area and desks make Bus hostel our top pick for Digital Nomads in Reykjavik
  • $$
  • BBQ
  • Meeting Rooms
  • Bar

A well-equipped Reykjavik backpackers’ hostel, Bus Hostel is also one of the best hostels for digital nomads in Reykjavik. Free Wi-Fi and free-to-use computers, along with quiet spots to sit and think, make cracking on with work easy. Meeting rooms are available if you’re in town for networking and hustling up new deals.

Affordable and with a choice of private rooms and dorms, do note that you’ll need your own sleeping bag if staying in a dorm. Take a break from work to cook a tasty meal in one of the two kitchens, or get sociable in the cosy lounge and bar.

Why you’ll love it here:

  • Plenty of workspaces
  • Bike rental
  • Free parking

We’re not going to lie, it’s definitely not the most stylish hostel. Rooms and common spaces are pretty simple and basic, but that’s absolutely enough for a great and comfortable stay. It might not be totally Instagram-worthy, but it offers some massive bang for your buck.

For the active travellers, head to the reception and ask the staff about the bike rental. Cruising through the streets of Reykjavik during summer is something we can highly recommend. If you’re visiting in winter and bring your own car, you’ll be happy to hear that there’s free parking available for all hostel guests.

Once you’re done with work an exploring the area, come back home and prepare a tasty meal at the communal kitchen. This is also a great way to meet other travellers and get chatting. the kitchen is fully equipped and pretty spacious, so you can let your cooking skills shine!

More of the Best Hostels in Reykjavik

Although the Icelandic capital doesn’t have a whole heap of hostels to choose from, we’ve searched high and low to find you another 8 top hostels in Reykjavik and nearby areas, giving you more choices when it comes to the perfect place to stay.

Another Cheap Hostel in Reykjavik #1 – Oddsson

Oddsson best hostels in Reykjavik
Oddsson is the best cheap hostel in Reykjavik
  • $
  • Restaurant/Bar
  • Fitness Centre
  • Book Exchange

Describing itself a being for “thrifty people with expensive taste”, Oddsson is the best cheap hotel in Reykjavik for budget backpackers. Price may be reasonable (for Reykjavik!) but that doesn’t mean the hostel is lacking in any way. You’ll find restaurants and bars for chilling and chatting in the building, a shared lounge and kitchen, a book exchange, and free Wi-Fi. The sound-proof rooms have lockers (you’ll need your own lock), though do note that you’ll need your own sleeping bag and towel if you don’t want to pay to rent them and bump the price up.

Another Cheap Hostel in Reykjavik #2 – Reykjavik Downtown Hostel

Reykjavik Downtown Hostel best hostels in Reykjavik
Reykjavik Downtown Hostel is considered on of the best cheap hostels in Reykjavik and all of Iceland.
  • $
  • Café
  • Luggage Storage
  • Bike Hire

A recommended hostel in Reykjavik for travellers that want to stay in a quiet area that’s still within reach of the action, Reykjavik Downtown Hostel sits close to the harbour and all of central Reykjavik’s attractions. Pick the helpful staff members’ brains for all the top travel tips for exploring Iceland’s diversity, and swap travel stories in the lounge, kitchen, and café. Regular social events take place, including movie nights and live music. Tours and car hire are easily arranged, and long-term luggage storage is possible.

Another Cheap Hostel in Reykjavik #3 – Base Hotel

Base Hotel best hostels in Reykjavik
One more awesome cheap hostel in Reykjavik is Base Hotel!
  • $
  • Free Parking
  • Key Card Access
  • Travel Desk

Another Reykjavik hostel near the airport, Base Hotel has mixed and female-only dorms for six as well as private rooms. The low prices make this one a recommended hostel in Reykjavik for budget travellers who need a night or two close to Keflavik Airport. There are few facilities beyond sleeping accommodation, but many guests are simply passing through. Airport transfers are easy to arrange. Key card access and lockers help to create a secure environment. There’s an onsite café and laundry facilities, ideal if you don’t want to deal with a mountain of washing when you get home.

Best Hostel for Couples in Reykjavik – The Capital-Inn

The Capital-Inn best hostels in Reykjavik
With affordable private rooms, the The Capital-Inn is our top hostel for couples in Reykjavik
  • $$
  • Restaurant
  • Bike Hire
  • Laundry Facilities

The comfortable double rooms, complete with private bathroom and TV, make this one of the best hostels for couples in Reykjavik. A popular hostel in Reykjavik, The Capital-Inn boasts a large kitchen with two separate well-equipped cooking areas to prevent waiting around and getting hangry. The onsite restaurant serves tasty food if you want a date night away from DIY meals. Laundry facilities, bicycle rentals, and free Wi-Fi are available, though do note that you will need your own towel and sleeping bag if staying in a dorm bed.

Best Hostel Near Golden Circle, Iceland – Vatnsholt

Vatnsholt best hostels in Reykjavik
More of a bed and breakfast, Vatnsholt is a great budget accommodation in the Golden Circle
  • $
  • Restaurant/Café/Bar
  • Bike Hire
  • Laundry Facilities

Situated around 50 kilometres outside of Reykjavik city, Vatnsholt is part of the glorious Golden Circle, close to the magnificent Selfoss Waterfall. A perfect place for groups of friends and families to crash and enjoy Iceland’s dramatic countryside, the farm has private rooms for two, three, and six. Most rooms share bathrooms. Savour delicious farm-fresh meals in the onsite restaurant, make friends with the farm animals, and bond with human pals over a board game. Outdoor active adventures abound, with bike and boat rentals and lake fishing close to hand.

Best Hostel in Eyrarbakki – Bakki Hostel and Apartments

Bakki Hostel and Apartments best hostels in Reykjavik
Bakki Hostel is one of the best hostels in Eyrarbakki Iceland
  • $
  • Bar
  • Lockers
  • Free Parking

Located in Eyrarbakki (an orgasm of natural wonders), around 50 kilometres from Reykjavik, Bakki Hostel and Apartments is conveniently located for both the Icelandic capital and the stunning delights of the Golden Circle. With a cool story to tell, the building was once an old fish factory! Don’t worry, there are no lingering smells! There’s a ten-bed mixed dorm and a six-bed dorm for females only. All guests can feel a little fancy with rain showers and lavish living rooms, and lockers add to your peace of mind.

Self-catering facilities, free Wi-Fi, free parking, and hair dryers are available, and there’s a small bar that adds to the sociable atmosphere.

Best hostel in Hafnarfjordur, Iceland – Route 1 Guesthouse

Route 1 Guesthouse best hostels in Reykjavik
Route 1 Guesthouse is the best hostel in Hafnarfjordur Iceland
  • $$
  • Free Parking
  • Sim Cards
  • Peaceful Atmosphere

Located in Hafnarfjordur, Route 1 Guesthouse may only have private rooms (for two, four, and five) but it makes our list of top Reykjavik hostels for its good amenities, clean and smart designs, peaceful atmosphere, and reasonable prices for budget backpackers travelling in a group. Around a 20-minute bus ride from downtown Reykjavik, the hostel has a shared kitchen and offers free Wi-Fi and parking. Stock up on supplies for your home-made meals at two nearby supermarkets.

Best Hostel with a Private Room in Reykjavik – Hlemmur Square

Hlemmur Square best hostels in Reykjavik
Hlemmur Square is an affordable budget backpackers and the best hostel with a private room in Reykjavik…
  • $
  • Onsite Restaurant/Bar
  • Pool Table
  • Tour Desk

A perfect Reykjavik pad for budget backpackers and fancy flashpackers, Hlemmur Square offers a combination of affordable dorm beds and fancy private rooms with flashes of luxury. Splashes of colour breathe life into the property and the spacious rooms have blackout curtains and big lockers. Grab a drink or bite to eat in the restaurant/bar and unwind in one of the comfy lounges. Challenge friends, old and new, to a game of pool or a board-game marathon, make full use of the two kitchens, explore with rented bikes, book exciting trips, and surf the net with free Wi-Fi. If you’re looking for a private room and you’re not too keen on these options, why not go for a bed and breakfast in Reykjavik instead – You’ll be surprised at how affordable some of them are!

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Hostel B47

Hostel B47 best hostels in Reykjavik
Hostel B47 is a top backpackers hostel in Reykjavik
  • $$
  • Wheelchair Accessible
  • Free Parking
  • Steam Room

Hostel B47 is a top hotel in Reykjavik for travellers who like staying in a building with a bit of olde-worlde character; the hostel is located in an interesting historic house. Vibrant wall art adds a modern and rather quirky twist. Communal areas include a lounge, a dining area, and a basic kitchen. Vending machines are ideal if you get an attack of the midnight munchies. Wi-Fi is free and parking is also free, great news for people enjoying a self-driving adventure around Iceland.

101 Hostel

101 Hostel best hostels in Reykjavik
101 Hostel is a top hostel for solo travelers in Reykjavik
  • $$
  • Steam Room
  • Bike Hire
  • Luggage Storage

A top youth hostel in Reykjavik for backpackers who love meeting other travellers, 101 Hostel has everything you need for a comfortable stay in the city centre. Dorms sleep five, six, eight, or 11, and the property is wheelchair accessible. Chill out and socialise in the common room, or impress your fellow travellers with your culinary skills in the kitchen. Don’t fret about using too many dishes; no need to waste precious time with boring chores thanks to the dishwasher. Rent bicycles to explore Reykjavik and relax in the steam room after a day of sightseeing.

Reykjavik City Hostel

Reykjavik City Hostel best hostels in Reykjavik
Reykjavik City Hostel is one of the coolest hostels in Reykjavik and Iceland
  • $$
  • Wheelchair Friendly
  • Bike Hire
  • Games Room

The award-winning Reykjavik City Hotel is bursting with amenities and has a terrific location. It’s a top hostel in Reykjavik for travellers seeking wellness and relaxation. Within a ten-minute bus ride of downtown, you won’t go far to benefit from Iceland’s famous thermal waters—the hostel is right next door to the awesome Laugardalslaug thermal pool. There are indoor and outdoor social areas, a games room, kitchen, BBQ, tour desk, and café-bar, and the hostel offers free Wi-Fi and parking, hair dryers, laundry facilities, bike hire, and more. And, if all that wasn’t enough, the hostel regularly organizes social events too.

Reykjavík Hostel Village

Reykjavík Hostel Village best hostels in Reykjavik
Reykjavík Hostel Village is a top hostel in Reykjavik
  • $$
  • Tour Desk
  • BBQ
  • Free Parking

A great youth hostel in Reykjavik for travellers who love shopping, Reykjavik Hostel Village is just a few steps from the city’s liveliest shopping street: Laugavegur. There are private rooms and dormitories spread across three buildings. All rooms are bright and cheerful. There are no communal cooking facilities but you can start your day with a spring in your step after filling up on the buffet breakfast (extra charge) or toss something tasty on the BBQ. Groups of friends that really want to cook, however, can book a private apartment with a kitchen.

IGDLO Guesthouse

IGDLO Guesthouse best hostels in Reykjavik
IGDLO is a highly reviewed youth hostel in Reykjavik
  • $$$
  • Laundry Facilities
  • Luggage Storage
  • Free Parking

Although not strictly a hostel, the family-run IGDLO Guesthouse is still a great choice for backpackers in Reykjavik. Single rooms are available for solo travellers, the four-bed room is perfect for families or groups of buddies, and there are also rooms for couples. All rooms share bathrooms. The friendly members of staff are a great source of info about local must-sees and the guesthouse is in a prime location just a short walk from Reykjavik’s main bus station. There’s a shared kitchen and dining area, an outside terrace, and laundry facilities. Wi-Fi and parking are free.

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Vibrant Iceland Hostel

Vibrant Iceland Hostel best hostels in Reykjavik
Vibrant Iceland Hostel is a top hostel for solo travelers and Digital Nomads in Reykjavik
  • $$
  • Steam Room
  • Free Parking
  • Wheelchair Accessible

Situated between Reykjavik city centre and the airport, the boutique Vibrant Ice Hostel can be found in Hafnarfjordur. We predict this could become one of the best hostels around Reykjavik in 2021, largely because of its chilled-out vibe, modern amenities, and offbeat feeling. It’s easy to get to and from by public transport. The peace and quiet follows you to bed for a restful sleep. Each bed has a curtain for complete privacy and a reading light. Meet other like-minded travellers and get Iceland inspiration in the common rooms and kitchen.

Start Hostel

Start Hostel best hostels in Reykjavik
Start Hostel is a great hostel near the Reykjavik airport
  • $$$
  • Free Breakfast
  • Free Parking
  • Lockers

A convenient Reykjavik hostel near the airport, Start Hostel is eight kilometres from Keflavik Airport and 47 kilometres from Reykjavik city centre. A fairly new property, it is clean, comfortable, and modern. The six-bed dorms are separated by gender, and there are private rooms for two, three, four, and five. There’s a large communal kitchen as well as a shared lounge and laundry facilities. Breakfast and Wi-Fi are included and parking is free, ideal if you’ve collected a car for a self-driving backpacking trip around Iceland.

FAQ about Hostels in Reykjavik

Here are some questions backpackers ask about hostels in Reykjavik.

Travel Safety Tips for Reykjavik and Iceland

And don’t forget Travel Insurance! We’ve put together a roundup of Travel Insurance for backpackers – check it out here, or if you’re low on time, get a quote from World Nomads, our favorite travel insurance provider.

Getting an estimate from World Nomads is simple – just click the button or image below, fill out the necessary info, and you’re on your way!

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Over to you

Get ready. Iceland is going to blow you away. Hopefully, with the help of this guide you’ll have a better understanding of the best hostels in Iceland so you can focus on the amazing sights this country has to offer.

And remember, if you are having a tough time deciding which hostel to book, our highest recommendation is Kex Hostel.

By now I hope our epic guide to the best hostels in Reykjavik has helped you choose the perfect hostel for your adventure!

If you think we’ve missed anything or have any further thoughts, hit us up in the comments!

Do you own or run a kick ass hostel? Want to be featured in this list? Get in touch at [email protected]


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