Reykjavik on a Budget

Planning Your Trip

We’ll begin with a few tips for your planning stages. If you’re on our website, that probably means that you’re looking at renting/have already rented a campervan. That’s a great first step to helping you save money on a trip to Iceland.

For Reykjavik, your next step should be to look at accommodation.

Accommodation

Of course, the easiest way to save money on accommodation in Reykjavik is to simply sleep in the campervan one more night. The Reykjavik Campsite is only 15–20 minutes on foot from downtown Reykjavik, meaning you’ll be able to park your camper and enjoy the sights of downtown Reykjavik.

If not, several hostels are available in the downtown area. If you’re looking for a private room rather than a hostel, many guesthouses are available in the city. The following section provides more information.

Timing

Another thing to consider when traveling on a budget is the time of year you’re choosing to go. Peak season, from June to August, is the most popular time to visit Iceland – and the most expensive.

We love the shoulder season, from April to May or September to October. Not only are the prices better across Reykjavik but there’s also a chance to see the northern lights above the city. For a budget trip to Reykjavik, this is the best time to go. Although winter is even cheaper, you might be limited to what you can do during that time.

Transportation

You might think you have to consider transportation costs when planning a budget trip to Reykjavik. But Reykjavik is a compact and walkable city, as long as you’re staying near the downtown area.

Food and Drinks

Cooking for yourself with supplies from the supermarket is always going to be the most affordable way to eat, not just in Reykjavik but anywhere (another reason why keeping your camper an extra night might be worth it). But it would be a shame not to eat out at least once during your stay. Below, we’ve also rounded up some budget restaurants in Reykjavik for you to consider.

Tap water in Iceland is also some of the purest in the world, so you don’t have to buy bottled water (hint: bring a reusable water bottle!). We’ll go into some budget-friendly Reykjavik restaurants below. But first…

Budget-Friendly Accommodation Options in Reykjavik

If you’re staying in Reykjavik for a night or two without a campervan, accommodation will be one of the biggest expenses. There are of course budget-friendly options in the city, but in general, prices remain quite high. Here are some of the best options for budget-conscious travelers:

Hostels

Reykjavik has plenty of hostels that offer affordable accommodations for budget travelers. Hostels tend to be the best option for campervan travelers.

Some of the most popular hostels in Reykjavik include Kex Hostel, Loft Hostel, and Reykjavik Downtown HI Hostel.

Guesthouses

Guesthouses are another great option for budget travelers. They offer private rooms at a lower price point than hotels. Some of the most popular guesthouses in Reykjavik include Aurora Guesthouse, Galtafell, and Guesthouse Sunna.

Food and Drink: Eating Out in Reykjavik on a Budget

Food and drink can be expensive in Reykjavik, but there are ways to save money and still enjoy the local cuisine. If you’ve had enough of the camping food, here are some tips for budget-friendly dining in Reykjavik:

• Eat Street Food: Street food is an excellent option for budget travelers in Reykjavik. You can find delicious and affordable food options, including hot dogs, fish and chips, and soup, at local food trucks and stalls. The most popular street food area in Reykjavik is the Old Harbor area.
• Happy Hour Deals: Reykjavik's bars and restaurants often offer happy hour deals, where you can enjoy discounted drinks and food. These deals usually take place in the early evening, so be sure to check out the local bars and restaurants to see what deals they offer.
• Bring Your Own Alcohol: Alcohol can be expensive in Reykjavik, but you can save money by bringing your own. Another option is to purchase your alcohol at the duty-free shop at the airport before picking up your luggage. Here, you’ll find massive discounts on price compared to what’s available in the country. 
• Water: As mentioned earlier, Icelandic tap water is some of the purest in the world, so there's no need to spend money on bottled water. Bring a refillable water bottle with you and fill it up anywhere you like. 

The Best Budget Restaurants in Reykjavik

Icelandic Street Food

This relatively new restaurant in Reykjavik has exploded in popularity thanks to their amazing budget-friendly fare. At this restaurant you can enjoy some delicious Icelandic soups and get free refills and complementary waffles. Not bad at all!

Noodle Station

Simple yet delicious, Noodle Station is a great choice if you’re craving a bowl of Thai noodles. The premise is simple: choose either vegetable, chicken, or beef, and either spicy or mild. Kick back and enjoy, perhaps counting the krona you saved on your meal.

Bæjarins Beztu Pylsur

Reykjavik’s famous hot dog stand, where one hot dog will set you back less than 500 krona.

Mandi

A Reykjavik institution, Mandi is famous in the capital for their delicious kebabs. A favorite with the after dark crowd, this place will be jam-packed when everyone is leaving the bars to go home.

Nonnabitti

Another famous late-night spot for budget food, Nonnabitti does fantastic subs with all kinds of different ingredients. Again, open late.

Activities and Sightseeing

Reykjavik has plenty of free and low-cost activities and sights for budget-conscious travelers. Here are some of the best options for exploring the city without spending a lot of money.

The Best Free and Cheap Things to do in Reykjavik

Reykjavik is not famous for being a cheap city, but if you know where to look, you can find cool places that won't break the bank.

Admire Reykjavik’s Famous Landmarks

The best thing about Reykjavik is that most of the city’s main attractions are already free. Hallgrímskirkja, Harpa Concert Hall, the Tjornin Pond, the Sun Voyager Austurvöllur Square, and the Parliament Building – all of these are completely free to view. The only thing that you can expect to pay for is if you feel like taking the lift to the top of Hallgrímskirkja for views over the city.

Join a Walking Tour

Walking tours of Reykjavik are one of the easiest – and most cost effective – ways to get to know Iceland’s capital. Your local guide will have a near-endless amount of knowledge about Reykjavik’s history, the best sights, and plenty of insider recommendations. Alternatively, you can explore the city on your own, wandering between the major sights quite easily thanks to Reykjavik’s compact size.

Visit a Museum or a Gallery

Many of the museums and galleries in Reykjavik have very low admission fees. These places allow you to learn about Iceland's history, culture, art, and natural environment. Some of the most popular options include the National Museum of Iceland, the Wonders of Iceland exhibit inside the Perlan, the Reykjavik Art Museum, and the Icelandic Phallological Museum.

Enjoy the Natural Landscapes

Reykjavik is surrounded by stunning natural landscapes, and there are several outdoor activities that you can enjoy for free or at a low cost. A beautiful forest surrounds the Perlan, while nearby, the city’s geothermal beach makes for another option to enjoy some time outside. From here, a path heads in either direction; follow it and you will eventually make it all the way out to the Seltjanarnes Peninsula, where the Grótta Lighthouse sits at the tip.

Conclusion

Reykjavik can be expensive, but there are plenty of ways to save money. Staying in a campervan or choosing a budget hostel or guesthouse keeps accommodation costs lower. Cooking some meals and eating at affordable spots like street food stalls helps with food expenses. Walking is the easiest way to get around, and there are lots of free things to see, like famous landmarks and coastal paths. Planning ahead, checking for happy hour deals, and buying alcohol at Duty-Free can also help cut costs. With a bit of effort, you can explore the city without spending too much.