Top Capsule Hotels in Iceland in 2026

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Our top choices for Iceland capsule hotels

A futuristic room with a bed, a control panel, and a circular light fixture on the ceiling.

1. Blue Viking Pods

Reykjanesbær

Rene

A room with a futuristic design, featuring a central control panel, a hexagonal mirror, and polka-dotted bedding.

2. Space capsule Hostel by Welcome Iceland

Budardalur

Srinivas

3. Galaxy Pod Hostel

Holt

Tanya

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Top Iceland Hotel Reviews

Reykjavik Residence Apartment Hotel

10/10 Excellent

"Great location, great value and great hosts. Only improvement point is the bedsheets were a bit scratchy!"

CityHub Reykjavik

10/10 Excellent

"Checked in after midnight, and the staff was very kind and helpful. I did not do laundry as I was there only a few hours before heading out in the morning. I walked from the bus station, so not sure about parking. The breakfast to go was very clutch, as holding a hot coffee on my chill morning walk was amazing."

Alda Hotel Reykjavik

8/10 Good

"The family room was lovely and big with a huge bed and a sofa bed. There was plenty of room for storage although no actual wardrobe. Room 313 had a lovely view across the Main Street which was very pretty with all the lights. The breakfast was excellent and the times that we visited were not crowded at all. There is a Starbucks attached to the hotel and we parked at the Stjörnuport parking garage 5 minutes along the street using the Parka parking app. Only negatives were that the bathroom shower had some mould on the fixtures, the sink was cracked and the water leaked under the unusual folding shower doors."

Grandi by Center Hotels

8/10 Good

"We loved everything about this hotel except for one major thing (will get to this in a second). The location was great: easy walking distance of downtown, but far enough away that it was nice and quiet. The interior was gorgeous, and our room was clean and modern. We also loved that it was right next to a cafe which made it easy to grab breakfast or a quick coffee. With all of these things, the price of staying was very reasonable. Our only compliant is how hot our room got. My wife and I both like to sleep on the cooler side, but we couldn't control the temperature of the room. There's a gauge on the heater, but even when we turned it all the way down, the room remained very warm, and both my wife and I would wake up sweating in the middle of the night. We could crack the window, but that meant we had to leave the curtains open to let the cool air in, and because we were on the first floor, we couldn't do that. Side note: we also had one of the employees at the front desk tell us that our windows were one way and no one could see in from the outside, but when we walked outside the hotel, it was apparently this was not true at all. Anyways, if the hotel could fix the temperature issue, the hotel would be perfect and we'd love to stay here again when we come back."

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