12 Must-Visit Trendy Hotels in Iceland

Iceland blew my mind the first time I visited. The otherworldly landscapes of bubbling hot springs, massive glaciers, and black sand beaches make it feel like you’ve landed on another planet. But what made my trips truly unforgettable were the incredible places I stayed along the way.

I’ve explored many of the best places in Iceland, and the accommodation scene has evolved dramatically in recent years. From the glass-roofed suite near Reykjavik, where I watched the northern lights dance overhead without leaving my bed, to that converted farmhouse in the Golden Circle, where the owner served homemade skyr for breakfast. These trendy hotels aren’t just places to crash after a day of adventure—they’re experiences that enhance everything about your Icelandic journey. Here are 12 standout properties that perfectly blend style with the raw beauty of Iceland.

Top Unique Stays in Iceland

Looking to discover unique places to stay in Iceland? Beyond the typical accommodations, the country offers plenty of distinctive options waiting to be explored. Relax at the Panorama Glass Lodge, offering stunning views of the Northern Lights. Experience the charm of The Little House by the Sea, a cozy retreat with coastal beauty. Unwind at The Reykjavik Domes, providing a unique glamping experience near the city.

Whether you’re into stargazing, coastal retreats, or glamping, here are 12 of Iceland’s most exceptional places to stay!

1. 5 Million Star Hotel (The Bubble Hotel)

Ever dreamed of falling asleep with the Northern Lights dancing directly above your bed? The aptly named 5 Million Star Hotel offers transparent bubbles nestled in Iceland’s pristine wilderness, about 90 minutes from Reykjavík.

These unique geodesic domes provide unobstructed views of the aurora in winter and midnight sun in summer. I’ve never seen the Northern Lights more vividly than through these crystal-clear walls. Each bubble includes heated floors and comfortable bedding, though bathrooms are shared in a nearby service house.

Located near the Golden Circle route, guests can easily explore Thingvellir National Park, Geysir, and Gullfoss Waterfall during daylight hours. Perfect for couples seeking a romantic night under stars or photographers chasing the perfect aurora shot. The hotel strictly limits bookings to preserve the tranquil atmosphere, so reserve months in advance.

2. Panorama Glass Lodge

Want to soak in a private hot tub while watching the Northern Lights paint the sky? The Panorama Glass Lodge has exactly what its name promises—panoramic glass walls that frame Iceland’s dramatic landscapes.

Located on a secluded peninsula about 30 minutes from Akranes (and an hour from Reykjavík), these four exclusive cabins blend luxury with wilderness immersion. Each features a private hot tub perfectly positioned for Northern Lights viewing, plus a fully-equipped kitchenette and plush king bed.

What truly sets these lodges apart is their thoughtful privacy—despite the transparent design, clever positioning ensures you’ll never see neighboring cabins. With the Glymur waterfall and Hvalfjörður fjord nearby, adventure awaits by day. At night, soak in your geothermal tub while watching the sky dance above your glass ceiling bedroom.

3. Original North

Craving an Instagram-worthy escape that none of your friends have discovered yet? Hidden in northern Iceland’s remote Tröllaskagi Peninsula, Original North offers modernist A-frame cabins that deliver solitude without sacrificing style.

Located about 30 minutes from Akureyri, these architectural gems feature floor-to-ceiling windows framing views of Eyjafjörður, Iceland’s longest fjord. Each cabin provides a perfect base for exploring the dramatically less-touristed north. The minimal Scandinavian design creates an atmosphere where the wild landscape becomes the star.

Summer brings midnight sun-illuminating midnight hikes, while winter delivers crowd-free aurora viewing. I rarely experienced such perfect isolation that still allows easy access to northern Iceland’s untapped wonders. The onsite saltwater hot tub sits perfectly positioned for fjord views, while Arctic Heli Skiing offers adventures you simply can’t find in the south.

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4. The Little House by the Sea

Want to wake up to the sound of waves crashing just steps from your bed? Perched on Iceland’s dramatic Snæfellsnes Peninsula, the aptly named The Little House by the Sea has coastal charm in its purest form.

This standalone cottage sits just steps from crashing North Atlantic waves, about 2.5 hours from Reykjavík and 15 minutes from Stykkishólmur. Floor-to-ceiling windows frame views of Breiðafjörður Bay and distant mountains, creating a hypnotic seascape that changes hourly with Iceland’s mercurial weather.

The peninsula’s location provides easy access to Snæfellsjökull National Park, where Jules Verne’s “Journey to the Center of the Earth” begins. After days exploring black sand beaches and glacier hikes, return to watch seabirds diving from your private deck. The kitchen comes stocked with local coffee and breakfast essentials. What truly makes this place magical is falling asleep to rhythmic waves.

5. Ormurinn Cottages

Ever stayed in a building shaped like a dragon? Resembling something between Viking longhouses and modern architectural marvels, the uniquely serpentine Ormurinn Cottages (“The Dragon”) wind along a hillside in East Iceland, about 30 minutes from Egilsstaðir.

Their distinctive curved design maximizes views of Lake Lagarfljót, home to Iceland’s version of the Loch Ness monster. Each interconnected unit features turf roofs that blend seamlessly into the landscape while providing superior insulation.

The eastern location puts you perfectly positioned to explore Iceland’s least-visited treasures, including Hengifoss waterfall and the East Fjords. Floor-to-ceiling windows frame the mystical lake, while geothermal heating keeps interiors cozy year-round. I appreciated having access to pristine wilderness without sacrificing comfort. Summer brings remote highland hiking, while winter delivers Northern Lights viewing with virtually no light pollution.

6. The Reykjavijk Domes

Need to recharge in nature without missing out on Reykjavik’s legendary nightlife? For travelers seeking wilderness immersion without venturing far from civilization, The Reykjavik Domes offer an ingenious solution.

Located just 10 minutes from downtown Reykjavik in the Heiðmörk Nature Reserve, these geodesic domes deliver glamping with serious style. Each dome features a private hot tub, a luxurious king bed, and transparent walls for aurora viewing in winter. Despite the proximity to Iceland’s capital, the surrounding birch forest creates a surprising sense of isolation.

What makes these domes special is the balance they strike—wild enough to spot Arctic foxes, yet close enough to enjoy Reykjavik’s renowned restaurants after a day exploring. I’ve never found an accommodation that so perfectly bridges urban convenience with natural immersion without compromising either experience.

• Read Next: 12 Best Things to Do in Reykjavik, Iceland

7. Ion Adventure Hotel

Want to sip cocktails in a floating glass bar while watching the Northern Lights? Jutting dramatically from an otherworldly lava field, the Ion Adventure Hotel resembles a spacecraft that’s landed in Iceland’s most geothermally active region.

Located about 40 minutes from Thingvellir National Park, this architectural marvel sits perched on stilts above the Nesjavellir Geothermal Power Station. The award-winning design features floor-to-ceiling windows throughout, with the showstopping Northern Lights Bar suspended in air for 360° aurora viewing.

The hotel’s location in the Golden Circle provides easy access to Gullfoss and Geysir, while the onsite Silfra Restaurant serves hyperlocal farm-to-table cuisine. The partially exposed outdoor hot pool lets you soak in mineral-rich geothermal water while watching for Northern Lights in winter. I was fascinated by how it transforms Iceland’s harsh volcanic landscape into sophisticated luxury.

8. Blue Lagoon Retreat

Tired of sharing your Instagram moments with crowds of tourists? The exclusive Blue Lagoon Retreat elevates Iceland’s most famous attraction from tourist hotspot to genuine luxury experience.

Nestled in an 800-year-old lava field on the Reykjanes Peninsula (20 minutes from Keflavík Airport), this architectural masterpiece offers 62 suites with private access to a secluded section of the iconic milky-blue geothermal waters. Floor-to-ceiling windows blur boundaries between indoors and the otherworldly landscape.

The underground Retreat Spa provides treatments using the lagoon’s healing minerals. What distinguishes this property is its tranquil atmosphere that contrasts dramatically with the main lagoon’s crowds. The Moss Restaurant serves refined Icelandic cuisine with wine pairings from its impressive cellar built into volcanic rock. I’ve never experienced a more seamless arrival—transforming potential jet lag into floating bliss.

9. Kvosin Downtown Hotel

Want to live like a stylish local in the heart of Reykjavík? Behind a historic façade in Reykjavík’s oldest neighborhood, the Kvosin Downtown Hotel delivers apartment-style accommodations with boutique hotel service.

Located directly opposite Austurvöllur Square and Alþingi (Iceland’s Parliament), these 24 spacious rooms occupy a carefully renovated 1900s building. Each features kitchenettes, dining areas, and living spaces—some with balconies overlooking the square or Reykjavík Cathedral.

The location proves unbeatable, with Harpa Concert Hall and the harbor just five minutes away by foot. What distinguishes Kvosin is its balance of historic charm and modern amenities. The ground-floor Klaustur Bar boasts Iceland’s most impressive selection of wines and spirits. I particularly appreciated how the hotel’s neighborhood location lets you experience authentic Reykjavík living rather than feeling like a tourist.

10. Hotel Rangá

Want to be woken up when the Northern Lights start dancing? In the heart of South Iceland, Hotel Rangá has earned its reputation as the premier Northern Lights hotel in the country.

Located about 90 minutes from Reykjavík near the town of Hella, this log cabin-style luxury resort sits directly under one of Iceland’s most active aurora zones. The hotel’s Aurora wakeup service ensures you’ll never miss a display, while their three on-property observatory domes house powerful telescopes for stargazing with resident astronomers.

The location provides perfect access to the South Coast attractions, including Seljalandsfoss, Skógafoss, and black sand beaches. The acclaimed Rangá Restaurant serves farm-to-table Nordic cuisine featuring local lamb and salmon from the eponymous Rangá River flowing just outside. I was impressed by the perfect balance of luxury and authentic Icelandic hospitality.

11. Hotel Húsafell

Looking for a luxurious base to explore lava fields, waterfalls, and Europe’s second-largest glacier? Nestled between Langjökull glacier and Hallmundarhraun lava field in West Iceland, Hotel Húsafell has sophisticated luxury in one of the country’s most diverse landscapes.

Located about 90 minutes from Reykjavík, this eco-conscious design hotel serves as the perfect base for exploring Víðgelmir Cave, Hraunfossar waterfall, and Into the Glacier ice tunnel tours. The 48 rooms feature contemporary Nordic design with artwork by renowned Icelandic artist Páll Guðmundsson, who grew up on this very land.

The property’s geothermal pools range from swimming-temperature to hot-pot warm, all with stunning mountain views. What truly makes my stay memorable was the hotel’s commitment to sustainability—it runs entirely on renewable energy from its own hydroelectric power plant while serving hyperlocal ingredients from its own ponds.

12. Klettar Farm

Want to bottle-feed lambs in the morning and soak in a private hot tub beneath the Northern Lights at night? For travelers seeking authentic Icelandic farm life without sacrificing comfort, Klettar Farm has an immersive experience about 15 minutes from Vík on Iceland’s South Coast.

This working sheep farm offers five luxuriously converted cottages featuring floor-to-ceiling windows framing views of the Mýrdalsjökull glacier and Reynisfjara black sand beach. Each cottage features a private hot tub positioned for optimal Northern Lights viewing in winter.

The location provides unbeatable access to Dyrhólaey Arch, Skógafoss, and the infamous DC-3 plane wreck. What makes this accommodation truly special is the balance between privacy and engagement—owners offer optional farm tours where guests can participate in seasonal activities. I particularly enjoyed the farm-produced breakfast items, including freshly laid eggs and homemade bread.

Frequently Asked Questions (FAQs) about Unique Places to Stay in Iceland

Are you looking for more content about where to stay in Iceland? Here are some common questions (and answers) I get asked a lot about Iceland’s most unique hotels.

Which area is best to stay in Iceland?

The best area to stay in Iceland depends on what you’re looking for. For first-time visitors, Reykjavik is a great starting point because it offers a mix of culture, history, and access to famous sites like the Golden Circle. If you’re into nature and want to escape the crowds, the South Coast or West Iceland are fantastic for their breathtaking landscapes and quieter atmosphere.

Where do most people stay when visiting Iceland?

Renowned as one of the best places to live in winter, most visitors tend to stay in Reykjavik because it’s the capital and has a variety of accommodations to suit different budgets. It also serves as a convenient base for popular day trips. For a more unique experience, visitors often choose places like the Golden Circle area, Akureyri in the North for a less touristy vibe, or even remote locations like the Westfjords.

How many days should I spend in Iceland?

Ideally, spend at least 7 to 10 days in Iceland. This gives you enough time to explore the Golden Circle, the South Coast, and parts of the West or North. If you can only spare a few days, focus on Reykjavik and nearby attractions. For a more in-depth exploration, especially if you want to circle the entire island on the Ring Road, consider extending your trip to 2 weeks.

Is Iceland expensive?

Yes, Iceland is known to be quite expensive. Dining out, accommodations, and activities can add up. To save money, consider self-catering accommodations, use public transportation or rent a smaller car, and look for free natural attractions like waterfalls and hiking trails. Planning and booking in advance can also help manage costs.

Can you see the northern lights in Reykjavik?

Yes, but it’s not guaranteed. The Northern Lights are visible in Reykjavik, especially on clear, dark nights. However, light pollution in the city can make them less vivid. For the best experience, I recommend heading out to less populated areas, where the skies are darker. The period from September to April is your best bet for catching this natural wonder.

What is the best time of year to go to Iceland?

The best time to visit Iceland really depends on what you want to do. For warmer weather and to experience the midnight sun, visit in the summer months (June to August). For Northern Lights, winter (September to April) is ideal. Keep in mind, though, that winter also means shorter days and potentially challenging weather. Spring and autumn can be great for fewer tourists and lower prices, but the weather can be unpredictable.

Final Thoughts on Iceland’s Unique Places to Stay

Wrapping up, Iceland is a land of stunning contrasts and unforgettable experiences. From my travels, Hotel Rangá stands out as my personal favorite. It strikes the perfect balance between luxury and adventure, which makes it an ideal base for exploring the South Coast’s natural wonders. The hotel’s cozy atmosphere and exceptional views of the Northern Lights are truly unmatched.

Remember, when planning your trip, consider what you want to see and do. Reykjavik is great for culture and convenience, while the countryside offers tranquility and natural beauty. Budget wisely, as Iceland can be pricey, but the experiences are worth every penny. And no matter when you visit, Iceland’s landscapes and warm hospitality will leave you with memories to cherish for a lifetime. Whether you’re chasing the Northern Lights, exploring volcanic landscapes, or soaking in geothermal spas, there are unique hotels in Iceland that promise an adventure like no other.