Reykjavik on a Budget
- Lee Wenxin
- Jul 15, 2019
- 6 min read
Updated: Mar 24, 2020

“Why is everyone in Iceland?” might be a thought running through your head as you scroll through your social media feed. Well, you are not wrong. The number of international visitors to Iceland has been steadily growing, from 488,600 visitors in 2010 to 2,224,600 visitors in 2017 according to the Icelandic Tourism Board, almost five times more than 2010.
A series of unfortunate events made the country a tourist hotspot. The 2008 global economic crisis lead to severe devaluation of the Krona, making the once expensive destination accessible at budget prices. Then again in 2010, the country plunged into international spotlight when the Eyjafjallajökull volcano erupted, and the media gave Iceland unprecedented publicity of its beautiful landscape.
With its abundance of stunning views of waterfalls, lakes, glaciers, volcanoes and rolling mountains next to the quaint city of Reykjavik, what is not to love about Iceland?
Facts about Iceland

#1 More than half of Icelanders believes in elves.
Elves are known to be the “Hidden People” (Huldufólk) that Eve hid from God when he visited. The story goes that when God came to visit Eve, she was not finished with washing all her kids, so she hid the dirty, unwashed children from God. When God asked if these were all her children, Eve lied and said yes. God being God knew she was lying, so he punished her by banishing the children to remain out of sight forever.
#2 Iceland has been ranked first in the Global Peace Index for 11 consecutive years.
Iceland has approximately two murders per year and a prison population of 200. There is even a waiting list to enter prison for those who have committed minor crimes and these people can continue going about their daily lives till it is their time to serve. Iceland does not have a military and has a population of approximately 700 policemen.
#3 Icelanders go by the patronymic naming system.
Surnames are the given names of commonly the father, with the suffix -son for sons or -dóttir for daughters. For example, the most common surname in Iceland is Jónsson, with Jóns being the father of the child.
#4 Most of the streets and houses in Iceland are heated by geothermal water, thus saving on electricity to run heaters.
A nice perk to living near volcanic mountains and hot springs.
#5 Reykjavik’s name translates to smoky (Reykja) bay (vik), named when the first settler stepped into Reykjavik and saw smoke rising out of hot springs.
Top Three Tours
The most fuss free way to go around Iceland would be by tours. Since most tours will cover the major attractions in Iceland, we picked out the most affordable tours of the bunch.
#1 Northern Lights (Reykjavik Excursions, www.re.is/day-tours/northern-lights-tour/, prices start from 41USD)
Most might tell you they came to Iceland for Northern Lights and it is easy to see why. Reykjavik is the northern most city in the world and offers many tours for northern lights, making it easily accessible for travelers. To see the green hued spectacle, choose a day that has clear skies and low cloud coverage. Most tours offer a rebooking so keep in mind another day if you did not spot the lights the first-time round.
#2 Golden Circle and Secret Lagoon (Reykjavik Sightseeing, https://reykjaviksightseeing.is/tours/golden-circle-secret-lagoon-tour, prices start from 86USD)

The first stop of the Golden Circle is Þingvellir National Park where American and Eurasian continental plates are pulling apart rapidly at the rate of 2cm per year. There you’ll see spectacular sights of the country’s largest lake. Next up, the Geysir Geothermal Area is surely a sight to behold. You’ll find yourself mesmerized by bubbling water that shoots up from the geyser every few moments or so.
Further down, the Gullfoss Waterfall is fully deserving of its title “Golden Falls”. The thundering sounds of water cascading down the canyon proves the sheer power of the waters. Finally, if you missed the Blue Lagoon, the Secret Lagoon is the good alternative. Soak off the exhaustions of a day of travelling in the geothermal water, surrounded by hot springs and a mini geyser.
#3 South Coast (https://reykjaviksightseeing.is/tours/south-coast-classic-tour, prices from 78USD)
The South Coast tour begins with the icy blue Solheimajökull Glacier, a glacial tongue extended from the Myrdalsjökull glacier. Reynisfjara black sand beach may be a familiar spot for some as it was the shooting location for Rogue One: A Star Wars Story, Game of Thrones and many other films. The black sand was formed when lava flowing into the ocean cooled upon contact with the water.
If you haven’t had enough of the views of the ocean, we stop by Vik, a small town overlooking the black sand beach for lunch. Ahead is Skógafoss waterfall, one of Iceland’s biggest waterfalls. On a sunny day, you may spot a rainbow or two. Legend has it that the pot of gold is still hidden somewhere. Equally magnificent is the Seljalandsfoss waterfall. The cliffs behind the waterfall has a walkway for guests to walk behind the waterfall. Just remember to bring a poncho as no one is spared from the continuous spray from the falls.

Dining
For a meal…
#1 Icelandic Street Food

If there is one place you should dine at for local delicacies, it is at Icelandic Street Food. You cannot beat this spot for its prices and quantity. It offers shellfish, lamb soup and traditional plokkfishkur (fish) all for unlimited refills. The dishes are interchangeable for refills, so if you ordered lamb soup first, you can go ahead and try the other two dishes as refills. Free flow desserts, including donuts and brownies are free for all. Prices start at 12USD for generous servings of lamb and shellfish in flavorful soup and creamy fish.
For breakfast or tea…
#2 Sandholt

Sandholt bakery is Rekjavik Grapevine’s 2019 winner for Best Bakery for a reason. The cozy spot is a great retreat from the cold and offers all sorts of pastries. Pair their whipped cream hot chocolate with a chocolate croissant for a satisfying late afternoon treat.
For a quick bite..
#3 Bæjarins Beztu Pylsur

The hot dogs at Bæjarins Beztu Pylsur are a die for. It was so good we turned back mid-hot dog and ordered another one for ourselves. The lamb-based sausage is tender, juicy and bursting with flavor paired with sweet mustard and remoulade. Inside you will find crunchy bits of fried onions, raw onions and a warm place in your heart.
For a home-cooked meal…

#4 Bonus and Kronan
Drop by Bonus or Kronan if you are planning to have a stay in, home-cooked meal. Both supermarkets offer produce at a reasonable price. One tip – skip the gift shops and find your candy and snacks at Bonus instead for a non-marked up price.
Places to stay
There are many affordable hostels and homestays you can pick from in Reykjavik but be sure to choose a place near the bus terminals where tours depart and the city center for shops and restaurants.
#1 Bus Hostel
Located right at the Bus Terminal and a short 15 minutes’ walk from the city center, Bus Hostel is a great no frills accommodation for convenience and comfort. Guests can choose from the 4-bed female dorm at 26USD or a 16-bed mixed dorm at 23USD.
#2 Airbnb
You can get a great deal from Airbnb while staying amongst locals. Case in point, I travelled with three friends and we managed to snag an entire two-bed apartment for ourselves for the price of 45USD each.
If you have one day left in Reykjavik…

#1 Join a free walking tour by City Walk Reykjavik and learn more about Iceland’s history and culture.
#2 Who says enjoying in geothermal water should cost a bomb? Soak in public swimming pools like Vesturbæjarlaug, Sundhöllin and Laugardalslaug for a luxurious time.
#3 Walk by the Old Harbor at sunset and marvel at the pink, purple and blue tinged sky. Those Tumblr images weren’t lying to us!
#4 Visit the Hallgrímskirkja Church, a structure inspired by the fascinating shapes formed when lava cools into basalt rock. Go up the church for a bird’s eye view of the entire Reykjavik.
A Word with Locals

Eiríkur Kúld has been a tour guide at Citywalk since 2014. A history graduate, he would know better than anybody about Iceland’s history and culture.
What is something in Iceland that you feel is a bit of a tourist trap?
The Blue Lagoon. It is beautiful no doubt, but it is extremely expensive and quite crowded. I find our public baths more comfortable. Any in Reykjavik is good.
Any recommendations of things to do off the beaten path?
To truly immerse yourself in Iceland’s beauty, rent a car hitchhike or even cycle around the countryside, travel from one fishing village to another or camp out in the wilderness. Iceland is a surprisingly big country and mostly open to those who want to enjoy it.
What is one thing you should not leave Reykjavik without trying?
Our salmon! I know there are many countries that claim to have the best salmon, but I still find Reykjavik’s the best. I like mine fried on a pan with a touch of lemon pepper.
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