Where to Stay in Reykjavik, Iceland: Best Areas for First-Time Visitors

When considering where to stay in Reykjavik, Miðborg is usually the easiest and best area for first-time visitors. However, if you are considering budget, whether you rent a car, how close of a walk you want to be to the main area, or want a quiet neighborhood, there are more options available.

I spent just over a week in Iceland and chose to base my whole stay in Reykjavik. Even though we had enough time to complete the Ring Road, the idea scared me a bit for our first time in Iceland. I wasn’t ready for the possibility of four seasons in a day while driving, since I don’t experience four seasons in a year!

Reykjavik actually proved to be a wonderful base for exploring the southern portion of Iceland. We stayed on the border of Miðborg and Hlíðar, which meant we saved a little money, but had about a 15 to 20 minute walk to the main area.

I’ll break down the main areas and include the highlights for each, so you can decide where to stay in Reykjavik that suits your trip!

Quick Comparison Table: Where to Stay in Reykjavik

Neighborhood	Best For	Vibe	Walkability to Center	Highlights
Miðborg (101)	First-timers, no car	Central, walkable	Excellent	Hallgrímskirkja, Harpa, restaurants, nightlife
Vesturbær	Culture, seafood, harbor views	Local, waterfront	Very good	Old Harbour, Grandi, museums, whale watching
Hlíðar	Budget travelers, quieter stay	Calm, residential	Good (15-20 min walk)	Klambratún Park, Kjarvalsstaðir, easy access to center
Laugardalur	Families, rental car travelers	Green, spread out	Limited (car recommended)	Geothermal pool, botanical garden, zoo

Miðborg (101) | Walkable and Central

When considering where to stay in Reykjavik, this is the main area! Miðborg is the main downtown part of Reykjavik and where you will want to consider basing yourself.

During my 8 day Iceland itinerary, I based myself here and it worked out well. However, we chose a more budget friendly option on the border of Miðborg and Hlíðar, so I actually had about a 15 to 20 minute walk to the main area.

If you plan to rely on public transport, tours, or taxis, I’d suggest this area as your base. It’s very walkable with plenty of restaurants and things to do.

Vesturbær | Local and Waterfront

After Miðborg, Vesturbær is the next best area. Most of the hotels are close to the water on the north end, because that is where the main sites are located.

Additionally, the north side of Vesturbær is very close to the main downtown area of Reykjavik, so you can enjoy the best of both worlds!

The main drawback of this neighborhood is you have fewer accommodations to choose from, but if you like one, it’s a worthwhile area to consider!

Just be sure to check the location, especially if you book a home or apartment stay as it could be further away from the desirable areas.

Hlíðar | Quiet and Still Close

I technically stayed in Hlíðar, but it was right on the border of Miðborg. This area was nice, but about a 15 to 20 minute walk to the main downtown area of Reykjavik.

It’s worth staying here if you want to save some money and don’t mind extra walking. Or even using a scooter for a portion of the journey.

When you consider the things to do in Iceland, most are outside of Reykjavik, so proximity is mainly helpful for breakfast and dinner. Hlíðar is a good middle ground being close enough to the main area of the city, but also being on the other side of higher traffic areas.

Laugardalur | Family-Friendly and Green

During my 8 day Iceland itinerary, I don’t think I ever ventured into this area at all. It’s further out and more residential. However, if you’ve rented a car and prefer a quieter area, this is worth checking out.

Best for families, outdoor-focused travelers, or those who rented a car and want a quieter stay.

Reykjavik Accommodations Interactive Map

Getting Around Reykjavik

As a tourist, I got around Reykjavik on foot. Otherwise, we used taxis and tours with pickup and one day we rented a car. However, there are a few more options to consider!

Taxis are expensive, so if you use them be sure to confirm price beforehand. I learned that the hard way on arrival. They don’t use Uber or Lyft, but they do use Hopp, so consider downloading that or asking locals on arrival for advice.

If you stay more on the outskirts of Reykjavik, they have scooters you can rent to cut your walk in half. I have used scooters in other cities, and if the weather is cooperating, it can be a fun way to get around.

Reykjavik also has public buses, but again, I didn’t use them. However, I felt very safe in Reykjavik, so it’s worth considering if you wanted to save some money in what is a more expensive destination.

Ultimately, if you just want to walk while in Reykjavik, consider staying in Miðborg. Alternatively, Vesturbær is a good option as the hotels are located in the desirable tourist area and within good proximity to the main downtown areas.

Final Thoughts on Where to Stay in Reykjavik

While I stayed on the edge of Miðborg and Hlíðar, I think staying in the heart of Miðborg is better if your budget allows. You will want to frequent that area for dinners and any other downtime during your vacation in Iceland.

Of course, if you want to save some money, or just prefer a quieter area, the other neighborhoods are great as well! While Reykjavik is the main city in Iceland, it never felt overwhelmingly large and as three girls traveling, we always felt safe in Iceland.

Choosing where to stay in Reykjavik is not a high stakes decision, but if you want to be close to the main areas, it’s worth considering what zone will work best for your trip.

If you’re considering hopping to another country, check out my Faroe Islands guide or explore more destinations in Europe.