Downtown Reykjavik
Photograph: Shutterstock
Photograph: Shutterstock

Where to stay in Reykjavik

From natural landscapes to buzzing downtown, Reykjavik’s neighbourhoods cover all the bases

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What can one expect from the world’s northernmost capital that boasts a little over 150,000 people? Well when it is Reykjavik, you can expect a little bit of everything. From a quaint old harbour, to art and leisure districts to a bustling downtown packed with a variety of things to do, Reykjavik has it all.

And the plus side of small cities? You are rarely far from any of the action. Couple that with the Reykjavik City Card, and you have free (yes, free!) unlimited access to the public bus, pools and museums. Wherever you choose to rest, here’s our ultimate neighbourhood guide to Reykjavik. 

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Shruthi Basappa is a writer based in Reykjavik. At Time Out, all of our travel guides are written by local writers who know their cities inside out. For more about how we curate, see our editorial guidelinesThis guide includes affiliate links, which have no influence on our editorial content. For more information, see our affiliate guidelines

Where to stay in Reykjavik

1. Grandi

Best for: maritime experience

Grandi used to be a slender stretch of sand that connected Reykjavik and the island of Örfisriey. Today, Reykjavik’s oldest harbour, now reformed hip district has that extra something that only time and tide lend. If you stay at the Grandi by Centre Hotels you are close to the action all around — whether you start at the far end of the peninsula with a bird’s eye view across the natural wonders of Iceland at FlyOver Iceland,  experience flowing molten lava (indoors!) at Lava Show, experience the world of underwater gentle giants at Whales of Iceland, or walk to the other tip of Grotta, Seltjarnarnes, to catch a stunning sunset (or Aurora if the time is right) this district delivers on that maritime experience and some. Dining options are aplenty: from a delectable South-Indian weekend-only brunch at Hraðlestin, to flaky pastries at Hygge Microbakery, fresh-off-the-boat fried cod and haddock at Fish & Chips Vagninn to pizzas with a view at Ráðagerði.

2. Downtown

Best for: music, food and design 

Stretching from Ingólfstorg to the end of Laugavegur, Downtown Reykjavik is the heart of the city. Take it all in at once from the spires of Hallsgrimskirkja, walk down rainbow street and do as locals do with waffles and art at Mokka Kaffi. Live music venues are aplenty – Mengi, Gaukurinn, Hús Máls og Menningar all have impressive line-ups of of-the-moment ambitious music. Quench that thirst with an ice-cold beer at Einstök Bar, natty wines at Vinstukan, French champagnes at plush Apero Vínbar and make some reckless decisions at designer store Stefansbúð, Sif Benedicta or Icelandic design mecca, Epal. Wake up in one of the rooftop rooms of the decadent Iceland Parliament Hotel or the historic Apotek Hotel (both overlooking Austurvöllur, the Parliament square) and grab breakfast at Deig, Brauð og Co, Laugavegur, or iconic Sandholt close by. Pop into Listasafn Reykjavik for scintillating installations. Dinner options run the gamut from Michelin-starred restaurants like Dill and Óx to casual local fav’s like Skál and Jómfrúin, to late-night kebabs at Arabian Taste

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3. Laugardalur

Best for: art, outdoors, family-friendly

Smack dab in the middle of Reyjkjavik is its lung - Laugardalur. With a family zoo, sports arena, art galleries and parks, this is a slice of suburbia tinged with high culture the city is known for. Staying at the Hotel Reykjavik Grand offers spectacular views  and old-school hospitality. Skip the fancy spas for a true Icelandic pool experience at Laugardalslaug. It’s the equivalent of a British pub where locals meet. Wrap up your hot pot sessions, with a hot-dog from the stand outside, then walk up the hill to Skúbb for their award-winning seasonal scoops. Asmundarsafn, dedicated to the works of Ásmundur Sveinsson, is an architectural delight both inside and the gardens outside. You may be familiar with his works dotted around town. If you have young ones in tow, and still want a slice of culture, head to Klambratún, the city’s biggest planned park. With dedicated playgrounds, grassy mounds to roll over (or sled in snowy winters), and plenty of room to roam, or just watch the clouds drift by. Seek refuge at Kjarvalsstaðir, a stunning gallery that is a visual treat and houses Klambrar Bistro to satisfy those post-park munchies.

4. Hafnarfjörður

Best for: small town vibes

Locals will be quick to remind you that Reykjavik as most know it is in fact a collection of 5 distinct towns that make up Greater Reykjavik. Hafnarfjörður is certainly the most charming town with their unabashed love for all things elves, trolls and lava fields. The Viking Village is unapologetically kitsch but with comfy rooms and a secret sauna. Grab a beer at Fjörukrain, walk over to Pallett Kaffi for excellent coffee and a slice of Britain a la scones, clotted cream and vintage cookbooks or at Brikk, a very Icelandic bakery with mayo salad sandwiches and bakes. Stroll around the harbour and grab lunch at 40-year old Kænan where time seems to stand still or at more contemporary Von. Make a day of exploring the cute downtown, and enjoy your sandwich amidst bird calls at Helligerði

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