A coastal landscape with green hills, a rocky cliff, and a calm sea.

Find Cheap Hotels in Southern Iceland

  • Change your mind

    Book hotels with free cancellation

  • Treat yourself

    Save instantly and earn perks with One Key
    Learn about One Key

  • Be picky

    Search almost a million properties worldwide

Check availability on Southern Iceland Cheap Hotels

Tonight
18 Oct - 19 Oct
Tomorrow
19 Oct - 20 Oct
Next weekend
23 Oct - 25 Oct
In two weeks
30 Oct - 1 Nov

Our top choices for Southern Iceland cheap hotels

A modern interior with wooden flooring, black brick walls, and large windows offering a city view. Tables and chairs are arranged for dining.
A modern bar area with a long counter, four black chairs, and a large mirror above the counter.
A modern interior with a piano, seating area, and a staircase.
A bar area with a brick wall, bar stools, and a counter with bottles.

1. The Barn - Hostel

The Barn - Hostel
Vik I Myrdal
Canada
Ankit
£69
includes taxes & fees
16 Nov - 17 Nov
The Barn - Hostel
A bunk bed with a wooden slat wall, a small shelf, and a plaid curtain.
A rustic building with a sign reading 'Fox Hostel' and a large glass door entrance.
A snow-covered landscape with a building featuring large glass windows and outdoor seating.
A kitchen with a stove, a kettle, and a cup on the counter.

2. The Fox Hostel

The Fox Hostel
Hrífunesvegur
United States
Joe
£56
includes taxes & fees
1 Nov - 2 Nov
The Fox Hostel
A modern building with a grey facade, a wooden accent wall, and a large window.
A conference room with large windows, a whiteboard, and a poster of animals.
A kitchen with a wooden countertop, a coffee machine, a microwave, and a toaster. There are framed pictures on the wall and a window with a view of the outside.
A reception area with a fireplace, a baby changing station, and a map of the hostel.

3. Höfn HI Hostel

Höfn HI Hostel
Höfn
United States
Anna
£69
includes taxes & fees
3 Nov - 4 Nov
Höfn HI Hostel
A stainless steel kitchen with a central island, overhead ventilation, and a row of pots below.
A parking area with cars, a building labeled "Entrance Restaurant & Reception," and a waterfall in the background.
A hotel room with two beds, a desk, and a chair.
A staircase with dark carpeted steps leading to a landing, adjacent to a window with a view of a hilly landscape.

4. Skogar Hostel

Skogar Hostel
Rangárþing eystra
United States
Aidan
£88
includes taxes & fees
1 Nov - 2 Nov
Skogar Hostel
A hotel room with a bed, desk, chair, TV, and a window with a view.
A kiosk with various snacks and drinks, including chips, pasta, noodles, and beverages, displayed on a chalkboard wall.
A modern building with the sign "START" on the facade, featuring a flat roof and large windows.
A buffet with various food items and beverages.

5. Start Hostel

Start Hostel
Reykjanesbær
Canada
Jessica
£104
includes taxes & fees
6 Nov - 7 Nov
Start Hostel
A modern living room with a dark sofa, a round coffee table, and several potted plants.
A modern office space with a sofa, chairs, a table, and a large window.
A multi-story building with a yellow facade, white trim, and a central entrance.
A modern hotel room with a skylight, a bed, a bedside table with a lamp, a mirror, a sink, and a framed picture on the wall.

6. Old Town Reykjavik

Old Town Reykjavik
Downtown Reykjavik
Canada
Tatiana
£62
includes taxes & fees
17 Nov - 18 Nov
Old Town Reykjavik
A building with multiple windows and a flat roof, under a night sky with green aurora lights.
A compact kitchen with a white table and chairs, a microwave, a toaster, and a sink.
A hallway with a mirror, a door with emergency exit signs, and a fire extinguisher.
A room with a beige sofa, a glass coffee table, a black chair, and a small orange table.

7. Hostel Fjordur

Hostel Fjordur
Hafnarfjörður
United States
Kanchan
£71
includes taxes & fees
18 Nov - 19 Nov
Hostel Fjordur
A modern bedroom with a black bed, a wooden floor, a fur rug, a bedside table with a vase, and a hanging light fixture.
A parking lot with several cars and a building with multiple windows.
A spacious indoor seating area with leather couches and chairs, large windows offering a view of the street outside.
A modern lounge area with seating arrangements, a wooden table, and a large window with a view of the outside.

8. Bus Hostel Reykjavik

Bus Hostel Reykjavik
Hlíðar
United States
Deborah
£80
includes taxes & fees
18 Nov - 19 Nov
Bus Hostel Reykjavik
A two-story house with a snow-covered roof and a white picket fence.
A double bed with white bedding and black and white patterned pillows, a bedside table with a lamp, and a painting on the wall.
A wooden deck with a metal railing, overlooking a street with buildings and a mountain in the background.
A kitchen with a microwave, stove, and checkered backsplash.

9. Refurinn Reykjavik Guesthouse - Hostel

Refurinn Reykjavik Guesthouse - Hostel
Vesturbær
United States
Justina
£98
includes taxes & fees
26 Oct - 27 Oct
Refurinn Reykjavik Guesthouse - Hostel
A bunk bed in a room with a dark wall and a wooden floor.
A parking lot with several cars parked in front of a building with large windows and a flat roof.
A conference room with a long table, chairs, a sofa, and framed pictures on the walls.
A hallway with paintings on the walls, a wooden door, and a desk with a bird sculpture.

10. ASTIN ER SVARID HOSTEL

ASTIN ER SVARID HOSTEL
Keflavík
Canada
Darren
£121
includes taxes & fees
19 Oct - 20 Oct
ASTIN ER SVARID HOSTEL
View all properties

Find out more about Southern Iceland

Discover cheap things to do in Southern Iceland

Southern Iceland offers a trove of memorable experiences that won’t break the bank. Start your adventure at the iconic Seljalandsfoss waterfall, where you can walk behind the cascade for an unforgettable view—perfect for family photos. Just a short drive away, Skógafoss waterfall presents another stunning sight, and the surrounding area features a hiking trail that leads to even more scenic views, all free to explore. For a unique geological experience, visit the Sólheimasandur plane wreck, an eerie yet fascinating sight that requires a picturesque 4km walk from the parking area—ideal for those who enjoy a bit of adventure. If you’re keen on exploring the great outdoors, the black sand beaches of Reynisfjara near Vík are a must-see, where you can marvel at the basalt columns and take in the dramatic coastal scenery, all at no cost. When it comes to budget-friendly accommodation, consider staying in Vík, where a range of affordable hotels and guesthouses offer comfortable lodgings with easy access to these attractions. This charming village not only serves as a convenient base for day trips but also boasts local eateries where you can sample traditional Icelandic dishes without overspending. With stunning landscapes at your doorstep and a welcoming community, Southern Iceland is a delightful choice for a family adventure.

How to get cheap hotels in Southern Iceland?

✅ The length of stay in Southern Iceland often varies depending on the nature of the trip, but many travellers opt to stay for several days or up to a week to take in Southern Iceland's notable landmarks and points of interest.

✅  If you're looking for cheap hotels in Southern Iceland in 2026, book your hotel well in advance. Reserving your stay at least a few weeks or months ahead of time can help you take advantage of amazing rates on cheap hotels in Southern Iceland, and if your plans change you can find many options of hotels with free cancelation.

✅  To find affordable hotels in Southern Iceland on Expedia, start by entering your travel dates and the number of individuals in your group. Once you've provided this information, you can refine your search results by filtering for budget hotels in Southern Iceland.

✅  Use the filtering tools offered by Expedia to refine your search results by location, price limits, amenities such as breakfast included, and other factors that matter to you. This will help you quickly locate the ideal budget-friendly hotel that fits your specific requirements.

✅  If you're looking to save money on a cheap hotel in Southern Iceland, the ideal time to go is usually during the off-season in Southern Iceland. On Expedia, you can find hotels from £89*.

✅  Southern Iceland offers numerous budget-friendly attractions and activities for travellers, such as art and exhibits at free museums and galleries or exploring Southern Iceland on foot.

✅  One of the best ways to find cheap hotels in Southern Iceland is to search Expedia for properties that provide family-friendly accommodations and features such as activities and complimentary meals, and then sort these by price.

*Prices and availability are subject to change. Additional terms may apply.

Top Southern Iceland Hotel Reviews

Fosshotel Glacier Lagoon

Fosshotel Glacier Lagoon

10/10 Excellent
"beautiful views and excellent service"
Alyssondra 1-night trip
Posted 4 hours ago
Fosshotel Glacier Lagoon
Alda Hotel Reykjavik

Alda Hotel Reykjavik

10/10 Excellent
"Location was convenient, staff was friendly and helpful, breakfast buffet was plentiful with delicious options, and we even enjoyed the hot tub and sauna. Great place to stay!"
Casey 3-night trip
Posted 4 hours ago
Alda Hotel Reykjavik
Reykjavik Marina - Berjaya Iceland Hotels

Reykjavik Marina - Berjaya Iceland Hotels

10/10 Excellent
"Nice room - clean functional, adequate size. Very stylish and expansive series of cozy settings in the ground-floor lobby area (library, cinema, lounge, bar, etc.) that we enjoyed hanging out in. Quite walkable location. No hotel parking, but on-street parking was easy with parking app."
Richard 2-night trip
Posted 6 hours ago
Reykjavik Marina - Berjaya Iceland Hotels
Center Hotels Plaza

Center Hotels Plaza

10/10 Excellent
"Location location Location. You couldn't ask for a better location than this hotel. Right in the heart of everything. Shopping, restaurants, bus stop, taxi stand, attractions, parking, surrounded by color full buildings and minutes to the famous church. Our room was big enough for our luggage and all of our stuff as we have been traveling for weeks. Only concern was there is no counter top to place your toiletries. I would go back and stay at this hotel. Breakfast was good. Inviting lobby and friendly staff. 2 thumbs up."
Saira 1-night trip
Posted 11 hours ago
Center Hotels Plaza
Fosshotel Reykjavik

Fosshotel Reykjavik

8/10 Good
"Yes good."
Rajpaul 2-night trip
Posted 2 days ago
Fosshotel Reykjavik

Explore a world of travel with Expedia