Upon my first visit to Iceland's capital in 2015, it was impossible not to notice that it was a city on the rise and well-aware of its tourist appeal. Call it the Game of Thrones effect. So what's changed? Since my second visit in February 2016, prices have soared even higher and the town is ever friendly to a still-increasing influx of tourists (and their money.)
Even despite the outrageous prices, from $15 for a "cheap" beer or $27 for a bowl of soup, Reykjavik is charming, and if you don't mind eating in your Airbnb from time to time, a visit can be worth it.
Please note all establishments listed below represent only a portion of what is available in reykjavik and simply reflect my personal experience!
KEX Hostel is something of a hipster hub in Reykjavik, for travelers and locals alike, due to it's trendy bar and restaurant and intentionally grungy vintage industrial aesthetic. KEX does a lot of things right: the beds are comfortable, the prices are good (if you go with the massive 16-bed mixed gender dorm), the place is secure (with plenty of lockers), kitchens on every floor, and generally cool vibe. I found the bathroom situation to be a little lacking though, and the dim, moody lighting can make things feel a little dirty. And while the slightly fringe location makes it a little off the beaten path for your typical tourist, getting to other places downtown (in a fairly small city) will cost you in walking time.
I didn't stay in this hostel, so I have no right to an opinion about it, but it's located very centrally on a main commercial street and every time we passed the downstairs bar/restaurant looked trendy and lively.
As with any international vacation, the further in advance you book, the better your options for a deal. There are loads of flats available on Airbnb, many very conveniently located in the city's epicenter and thus walkable to most attractions and destinations. Another perk of getting an Airbnb - access to a kitchen, so you can rely on cheap groceries for meals instead of overpriced restaurant menus.
FOOD & DRINK
While expensive, we didn't have a bad meal while in Reykjavik. Local staples include lamb and fish dishes, though the cuisine is clearly diversifying due to demand. I was shocked to see so many vegan and vegetarian options, not only in nice restaurants but at fast food establishments as well. Another thing to note about eating out in Reykjavik - while the nightlife gets started late, most restaurants close their kitchens around 10pm, and also in the afternoon between lunch and dinner.
Restaurants & cafés
Islenski Barrinn (Iceland Bar)
bar/restaurant // $$
Maybe for tourists, but not heavy-handed. The menu features lots of "authentic" Icelandic foods (as far as this American would ever know) with a more modern-rustic presentation, if that is somehow a thing. Great selection of local and craft beers, as well as a decent wine list, the interior feels like a cozy cabin. Prices are pretty on par for Reykjavik's downtown, but the quality of the food, atmosphere and service at least made it feel worth it.
hotel/restaurant // $$
Apotek is a hotel with a restaurant on the main floor, which actually offers some decent lunch and happy hour specials, despite it's somewhat douchey, trendy appearance. We missed the window for such a deal, but I did order the burger and it was one of the best I've ever had.
cafe/restaurant // $$
Laundromat is lauded by just about every visitor to Reykjavik, and reasonably so. It's laid-back and cool, think diner in Portland, Oregon. Great spot for breakfast/brunch.
restaurant // $
Asian food in Iceland is fortunately better than the Mexican food. Super casual with counter service, this place is relatively cheap. Chicken ramen is just the thing to warm your cold, cold heart.
Te & Kaffi
cafe // $
Great budget option if you're trying to save some cash (and you probably are.) You can get two pieces of toast, with cheese and ham, butter and jam, for around $10. Sounds like a simple hobo meal, but it's pretty filling and delicious.
bakery/cafe // $$
Sandholt offers a sit-down restaurant as well as a take-away bakery/cafe next door with a variety of sandwiches, breads, and sweets. We grabbed a few pastries and coffees to go, and while they resemble high-end French baked goods, the prices were average. I'm guessing the sit down option is more expensive but Sandholt has been lauded and called "best bakery in Iceland," so perhaps worth it for a mid-day meal.
food court // $
Reykjavik's own upscale food court, featuring a coffee shop, ice cream, Mexican food, vietnamese, bars, and more. Perfect if you're with a group or can't decide what you want.
restaurant // $$$$
For a fancy, modern meal complete with cocktails incorporating traditional Icelandic ingredients, check out Grillmarkaðurinn, hidden behind Caruso at the corner of Lækjargata and Austurstræti. The interior is beautiful and chic, and while the food is a splurge, it's fun, innovative, and delicious. As tourists we had to try whale and puffin, and Grillmarkaðurinn offers an appetizer of sliders featuring both as well as langoustine.
cafe // $
If you're a hipster coffee snob, Reykjavik Roasters won't disappoint. Their coffee, while it took forever, was hotter than the sun. And tasted pretty good, I guess. The scone with cheese and jam was excellent.
Baejarins Beztu Pylsur
hot dog stand // $
People line up at this "famous" stand for authentic Icelandic hot dogs, replete with all the toppings - ketchup, mustard, remoulade, and raw and fried onions. And it's not all hype - the dogs are delicious, affordable, and the place is open late.
cafe/bar/restaurant // $$
Very chill bar & restaurant with a local vibe, great place for a casual meal and a beer. The fish burger here was great.
bar // $
As of the time I'm writing this, every Monday night at Gaukurinn is open-mic night in English, featuring mostly Icelandic performers committed to making you laugh in their second language. It's definitely worth checking out for the uniquely Icelandic perspective, "reasonably" priced beers at happy hour (comparatively speaking) and refreshing lack of frat boys. And I believe Tuesday nights are karaoke - trust, Icelandic people can sing.
bar // $
Right around the corner from Gaukurinn is Paloma Bar, a good old standard bar with no gimmicks, no pretense, and good music.
bar // $$
If you like traditional Irish pubs with traditional Irish/British bartenders, this place definitely sells alcohol.
bar // $$$
Wanna pretend you're in Hawaii instead of frigid Iceland? Wanna pay too much money for a bad tiki drink prepared by a 15-year old? Sure you do, it's vacation. While the drinks leave a lot to be desired, the DJ here on a Saturday night was on point (if you like classic 80s and 90s hits.)
craft beer bar // $$
This bar is small, as the name suggests, but offers a wide selection of craft and local beers. The atmosphere almost feels more like a hotel cafe, they really make a point of not playing music, so don't come here with boring people.
Skuli Craft Bar
craft beer bar // $$
Probably your best bet for getting the latest and greatest from the local Icelandic craft beer scene, which can otherwise be hard to find.
craft beer bar // $
Kex (same as the hostel listed above!) is a favorite hangout spot because they've got a full bar and reasonably priced food. The craft beer selection is A+, and they've even started making their own proprietary beers.
Mikkeller & Friends
craft beer bar // $$
The craft beer scene in Iceland is exploding, however slowly, and Mikkeller & Friends is at the epicenter. A favorite among locals and visitors alike, it guarantees the best selection of global craft brews in a cozy environment.
SIGHTS & ATTRACTIONS
Stay tuned for an in-depth post about Iceland as a whole, as the best parts of it are found in nature far from the cities. Below are a few things in or very near to Reykjavik, easily do-able without a rental car.
People will sometimes talk shit about The Blue Lagoon, because it's touristy, but like, duh. It's also awesome. If you like swimming, spas, hot tubs, etc. The Blue Lagoon is a great way to spend a day, especially if you're hungover. And it's big enough that even if there are a lot of people, it doesn't feel crowded. You'll need to take a ~1 hour bus ride from Reykjavik to get there, but they run quite often.
Golden Circle Tours
The most popular sight-seeing option for tourists staying just in Reykjavik, I think these depart quite often and are offered by numerous tour companies. They include the must-see sights within about an hour or two of the city, including Þingvellir National Park, Gulfoss, Kerid, Geysir, and more.
The Settlement Exhibition
An indoor display of an ancient longhouse settlement excavated in Downtown Reykjavik. If you like vikings, history, really old stuff, it's something to do.
Whale Watching & Puffin Tours
We didn't do one of these! They are a little pricey, and time-consuming, so plan in advance and leave early in the day. Also, I believe puffins can only really be spotted in certain areas in the summer!
Indoor and outdoor pools and baths frequented by locals. Entry is only about $10, so it's a great value if you're looking to relax and can't be bothered with the Blue Lagoon trip. Do note: no photos allowed anywhere in the facility!
The Icelandic Phallological Museum
From their website: "The Icelandic Phallological Museum contains a collection of more than two hundred and fifteen penises and penile parts belonging to almost all the land and sea mammals that can be found in Iceland". This museum is pretty gross, and weird, but hey, when in Iceland.
The Northern Lights
The Northern Lights are typically more visible in the winter months, because in summer, Iceland hardly gets dark enough to see them. If you haven't rented a car, there are plenty of companies offering excursions to see the Northern Lights since getting out of the city and away from light pollution also increases your chances of a good viewing. You can check this website to get a forecast of aurora activity, and of course you'll need clear skies too!
This is the really cool church in the center of Reykjavik. The distinct architecture is meant to recall the appearance of the basalt column formations that can be found all over Iceland. For something like $6 you can take an elevator to the top for a pretty nice view of the city spread out below.