Fagrabrekka Guesthouse in Iceland

Where to Stay in Iceland: From a Discerning Traveler

Last updated Jan 21, 2023 | Hotel Reviews Europe, Iceland

The southern coast of Iceland truly has the most spectacular sites! Walk behind a powerful waterfall, scramble up towering sea stacks, or witness the beauty of a slowly drifting glacier. Iceland is truly unique and offers some incredible experiences. The best way to see these top sites is a road trip over several days. I’ll show you our top three hotel picks of where to stay in Iceland to make your trip most enjoyable.

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Map of Where to Stay in Iceland + Top Sites  

Where to stay in Iceland Map

Where to stay in Iceland Map

My husband and I came up with a crazy, aggressive itinerary. We had 4 days to explore the Golden Circle, the south coast, and Reykjavik. I truly envy European’s month-long vacations, but oh well, we had to maximize what precious PTO days we did have. 

Do not get lost in the busyness of the map above. The whole point is to show all the top sites for the Golden Circle and the south coast. Once you see where the all sites are clustered, it will then make sense what hotel locations are best.  

4 days. 3 nights. 3 hotels. It can be done.  Although Iceland does not seem very big, the top sites along Iceland’s southern coast are quite spread out. It takes close to 5 hours to drive from Reykjavik to Jökulsárlón Glacier Lagoon, the most distant site along the southern coast.

Needless to say, you are not doing this as a day trip. You will need places to stay along the way. I am going to share our 3 personal hotel picks that made our trip enjoyable and seamless. 

Number 1 Icon

Fagrabrekka Guesthouse

Fagrabrekka Guesthouse was the first accommodation we stayed at on day #1 of our road trip. We arrived on a red-eye flight and drove straight from Keflavík International Airport past Reykjavik and hit all the top sites on the Golden Circle. If you are still trying to plan out your itinerary, check out my 19 Best Things to Do in Iceland. 

That evening we checked into Fagrabrekka Guesthouse. This adorable immaculately clean accommodation was our favorite place we stayed by far! It is located on a family farm that breeds Icelandic horses, which is the only type of horse allowed in Iceland. This friendly smart breed is considered to be one of the purest horse races in the world. 

Watching the Icelandic horses from our Fagrabrekka Guesthouse room in Iceland

Watching the Icelandic horses from our Fagrabrekka Guesthouse room in Iceland

The property has 4 “cottages”, each with its own veranda. The floor-to-ceiling glass windows offer some incredible views of the mountains and horses in the distance. There is something about being in nature that is instantly relaxing and melts away your stress. 

View from Fagrabrekka Guesthouse room in Iceland

View from Fagrabrekka Guesthouse room in Iceland

We were able to enjoy Iceland during the Midnight Sun, where daylight hours seem to go on forever. Thankfully, Fagrabrekka Guesthouse offered some great blackout curtains when we had to force ourselves to sleep. After arriving on a red-eye flight and driving around all day, we slept like a rock in this peaceful oasis. 

The next morning we were met by the lovely, gracious owner of the farm, Ragnhildur. We had a fantastic “farm-fresh” breakfast of local meats and cheeses, hard boiled eggs, vegetables, and homemade bread. What a great way to start the day! I instantly regretted not booking two nights. But we had to move on. 

Breakfast at Fagrabrekka Guesthouse in Iceland

Breakfast at Fagrabrekka Guesthouse 

UPDATESince the writing of this article, it appears Fagrabrekka Guesthouse is no longer accepting guests. I hope that changes soon as travel continues to pick back up! There is an incredibly adorable boutique alternative on booking.com in the same area with the same aesthetic.  Very highly-rated. Check availability below.

Number 2 Icon

Hotel Kria

Day #2 of our Icelandic adventure was jam-packed with some incredible sites. We witnessed two of Iceland’s most spectacular waterfalls,  Skógafoss and Seljalandsfoss Waterfall before driving to Diamond Beach and Jökulsárlón Glacier Lagoon.

In addition, we got some great exercise by hiking to the very unique Svartifoss Waterfall and walking around the out-of-this-world Fjaðrárgljúfur Canyon. If that was not enough, we squeezed in a quick visit to the Reynisdrangar sea stacks by midnight. The Midnight Sun really does energize you with superhuman energy. 

The Seljalandsfoss Waterfall in Iceland

Seljalandsfoss Waterfall in Iceland

Since Jökulsárlón Glacier Lagoon was going to be the furthest point on our road trip, we decided to make the town of Vik our home base. See the map above again for orientation. Vik is about the halfway point between Reykjavik and Jökulsárlón Glacier Lagoon. The town of Höfn would be the next logical location for your hotel stay if you were planning to travel the entire Ring Road.

Hotel Kria was another beautiful accommodation. Its 72 rooms and 1 suite have a very modern interior design. The hotel has two floors and two room types: standard and mountain view. Avoid the rooms in the front of the building if possible. They face the main road and gas station. Our request for a mountain-view room on the second floor was kindly accommodated.

Hotel Kria in Vik Iceland

Hotel Kria in Vik

View from our room at Hotel Kria in Vik Iceland

View from our room at Hotel Kria in Vik

We did not make it in time to have dinner at the hotel’s restaurant, which is known for serving delicious Icelandic cuisine made with seasonal ingredients. Instead we drove into town and had a tasty burger at the brewery, Smiðjan Brugghús. Their kitchen is open until 10 pm. The Soup Company would also be another solid choice. 

Eating burgers at Smiðjan Brugghús in Vik Iceland

Eating burgers at Smiðjan Brugghús in Vik Iceland

Breakfast is included in the room rate and includes a wide variety of both hot (eggs, bacon, sausage, etc) and cold items (bread, yogurts, pastries, etc). Breakfast is held in the main room with large floor-to-ceiling windows. 

On the second floor looking down at the breakfast room in Hotel Kria in Vik Iceland

On the second floor looking down at the breakfast room in Hotel Kria in Vik, Iceland

Although I prefer the small, personalized boutique stays like Fagrabrekka Guesthouse, this hotel location and experience still worked out great for our road trip.  

Number 3 Icon

Reykjavik Konsulat Hotel

On day #3 of our whirlwind road trip, we slowly made our way back to Reykjavik. Along the way, we stopped by to see some puffins and the Dyrhólaey Arch and then soaked in the Reykjadalur Hot Springs before checking in to our hotel in Reykjavik. 

Reykjadalur Hot Springs

Reykjadalur Hot Springs

The Reykjavik Konsulat Hotel, Curio Collection by Hilton is gorgeous! This building was built in the 1900s and used to be a department store. When it was transformed into a hotel, some features were still kept. You will see the exposed original stone walls in some of the rooms. 

The rooms are modern, and I loved the mid-century design touches. Very classy hotel. I will say I felt way underdressed when we first arrived. We came straight from hiking and soaking in the Reykjadalur Hot Springs, so you can imagine how we looked. Oh well, a quick shower did the trick and then we explored all the local Reykjavik sites. 

The Reykjavik Konsulat Hotel Curio Collection by Hilton in Reykjavik Iceland

The Reykjavik Konsulat Hotel Curio Collection by Hilton in Reykjavik, Iceland

The location is perfect. It is situated right next to Bæjarins Beztu Pylsur, the famous iconic hot dog stand in Iceland. You can read all about it in my Iceland Foodie Guide. Other sites within close walking distance include the major landmarks such as the Hallgrímskirkja Church and the Sun Voyager monument. Plus, my favorite bar in Iceland was a 1-minute walk away.

Eating a famous Icelandic hot dog at Baejarins Beztu Pylsur

Eating a famous Icelandic hot dog at Baejarins Beztu Pylsur

Perks of staying in this gorgeous hotel include a highly-rated on-site restaurant, full-service bar, and a fitness center. We used Hilton points and got incredible value for our stay. 

Final Thoughts

The most spectacular sites in Iceland are located along the Golden Circle and southern coast. Because the sites are all spread out, a road trip is a must. Picking the right hotels as your base is crucial for making a memorable, seamless experience. We were very happy with our three accommodation picks, especially Fagrabrekka Guesthouse! 

Questions about where to stay in Iceland?

Let me know in the comments below!


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