The 9 Best Hostels in Iceland (Updated 2025)

"Set in a former biscuit factory (kex means “biscuit” or “cookie”), I found this 200-person, Scandi-industrial-chic hostel offers mixed and female-only dorms, private doubles and family rooms; the dorms have really thick mattresses and lockers though no curtains. It’s very social — the bar area makes meeting people easy — and the complex houses long-term artists and designers, which adds a hip, creative element. There’s a heated outdoor terrace, kitchen facilities, and it’s centrally located with in-house tour experts for Reykjavik travel advice." - Matthew Kepnes