Where to Stay and What to See in South Iceland

Puffin flying in the south of Iceland

Where is the best place to stay in South Iceland? Are there any bungalows or cabins near the attractions of the South Coast and the Golden Circle? What is there to see in South Iceland? Continue reading for all you need to know about where to stay and what to see in South Iceland.

When marvelling over pictures of Iceland’s spectacular waterfalls, steaming hot springs, haunting deserts of black sand, glistening glaciers and magnificent coastlines, you could be forgiven for thinking that they must be taken from all over the island. It is more than possible, however, that all of these images came from just one region: South Iceland.

South Iceland is the home of the famous Skogafoss

It is, without a doubt, the most popular part of the country. After all, it is home to the two most famous sightseeing routes, the Golden Circle and the South Coast, both of which boast a diverse array of stunning features and landscapes. 

Almost all visitors to Iceland will want to spend at least a part of their holiday exploring it.

While it is possible to stay in Reykjavík and see Iceland’s south either through day tours or by renting a car, the hotels and hostels of Iceland’s capital do not appeal to everyone. 

After all, the country is very sparsely populated with enormous swathes of untouched nature, and many guests would much prefer to immerse themselves in the stunning landscapes rather than endure the hustle and bustle of the city.

Dyrholaey is located in the south of Iceland, not far from Vik

Thankfully, there are a wealth of cabins, cottages, bungalows and guesthouses strewn across the region, appealing to people of all budgets. 

Nestled amongst the sites of the Golden Circle, on the cusp of the South Coast, or right by the attractions, you have plenty of options that can help make your holiday tailor-made to your desires.

Furthermore, many of these places to stay in South Iceland have their own hot tubs on site, and are in nature remote enough that you can see the Northern Lights without even stepping outdoors in winter.

What to See in South Iceland

Tourists are having fun at DC-3 plane wreck in the south of Iceland

South Iceland’s attractions, as noted, are manyfold, representing the great diversity that can be found in the country. 

It is possible to explore the vast majority of the sites throughout the year in just a few days. Though guests staying out in nature will want to know where certain landscapes can be found so they can plan their accommodation accordingly.

What to See on the Golden Circle

Strokkur is the name of the famous Geysir located in the Golden Circle area

The Golden Circle is, second only to the Blue Lagoon, the most popular attraction in Iceland, due to its proximity to the capital and the fascinating sites along it. They can easily be explored in a day. 

It’s three major points are Þingvellir National Park, the Geysir Geothermal Area, and Gullfoss waterfall.

Þingvellir is not just one of three National Parks in Iceland, but the only UNESCO World Heritage Site on the mainland. 

In spite of many perceptions, this is not because of its incredible beauty, being a wonderland of forests, lava landscapes and crystal clear springs. 

It is not even to do with the fact that it sits between the North American and Eurasian tectonic plates, both of which are visible.

Þingvellir in the beautiful summer day

The National Park achieved its UNESCO status due to its history as a birthplace of modern democracy. 

Back in 930 AD, it was here that Icelanders first convened to form a representative assembly, the Alþing, an assembly which has survived over a millennium and now functions as a modern parliament in Reykjavík.

The Geysir Geothermal Area is also a site that has influenced the rest of the world; the Great Geysir here lent its name to all other exploding hot springs around the world. Though this particular feature is inactive, the neighbouring Strokkur erupts very regularly, often blasting boiling water and steam over 20 metres into the sky.

Strokkur is the most active Geysir in the Golden Circle

Surrounding Strokkur and the Great Geysir are plenty of bubbling mud-pits, hissing fumaroles and smaller geysers; the area is one of the best places in South Iceland to witness the country’s dramatic geothermal forces.

Finally, there is Gullfoss, perhaps the most iconic waterfall in all of Iceland. The glacier river that flows into its cascades in two dramatic tiers before crashing into an ancient valley, making for a spectacular sight.

Gullfoss is one of the most popular waterfalls in the south of Iceland

These sites are breathtaking, but in spite of their popularity, represent just a fraction of the attractions that can be found in the area. 

While those staying in Reykjavík taking day tours out will be limited to exploring these sites, those who book accommodation in South Iceland instead have plenty of opportunities to seek out more.

The vividly coloured Kerið crater lake, Faxi waterfall, the ecovillage of Sólheimar, the Secret Lagoon and the Fontana Spa are just some of the examples of sites to see in South Iceland. 

These are all far more accessible for those staying in a rural cabin or bungalow.

What to See on the South Coast

Sun setting in the South Coast of Iceland

Though South Iceland has far more sites than those of the South Coast, the terms are often used interchangeably due to the popularity and diversity of this stretch of land. 

The South Coast, like the Golden Circle, is often explored on day tours from Reykjavík. However, due to the distance of its furthest destinations from the capital, it is usually only done in part. 

Those that do cover the whole stretch will often be forced to skip certain sites in order to fit the more far-flung places in.

Guests who find somewhere to stay in South Iceland, however, will be able to marvel over the region at their own leisure.

Seljalandsfoss during sunset

Two of the closest sites to Reykjavík are both popular and beautiful waterfalls that stand at about 60 metres tall. Seljalandsfoss waterfall falls in a gentle stream before a concave cliff, allowing guests to fully encircle the cascading water when there is no ice on the ground. 

Skógafoss, meanwhile, is much more powerful and dramatic, with such a heavy flow that much of it is often obscured by the pluming spray at its base.

Behind these dramatic waterfalls are two of the countries most famous glaciers, Eyjafjallajökull and Mýrdalsjökull

Eyjafjallajökull is best known for the eruption that occurred beneath in in 2010, halting European air traffic and tongue-tying reporters the world over. 

Whereas Mýrdalsjökull, meanwhile, is renowned for its awe-inspiring glacier hiking opportunities, as well as the fact that it conceals a similarly explosive volcano, Katla.

You can see glaciers in the South Coast of Iceland

A little further east along the South Coast, and you will find some incredibly beautiful stretches of coastline. 

The vast Dyrhólaey rock arch, for example, is a magnificent site, made all the more beautiful in summer with its massive population of resident puffins. 

Reynisfjara beach, meanwhile, has otherworldly black sands, the towering sea stacks of Reynisdrangar, and the quaint village of Vík nearby.

Most day tours from Reykjavík turn around here, but those who have found a place to stay in South Iceland will have much more freedom to keep exploring. 

Those who do so will be vastly rewarded, as east of Vík is the largest national park in Iceland, Vatnajökull. Home to Europe’s greatest glacier, it is a wonderland of glacier tongues, towering mountains and spectacular vistas. 

Without a doubt, however, its highlight is the Jökulsárlón glacier lagoon.

Northern Lights over Glacier Lagoon

Iceland’s deepest lake, Jökulsárlón should top the list of travellers wondering what to see in South Iceland. 

Fed by the meltwater of an enormous glacier tongue, it fills with gigantic icebergs that, over weeks, months and even years, slowly cruise their way to the ocean. 

Adding to the unbelievable beauty of the site are the resident seals, who can be seen splashing in the azure waters and relaxing on the bergs throughout the year.
Adjacent to the lagoon is the Diamond Beach, a spectacular stretch of coast where the icebergs wash up and slowly melt on the black sands.

Other Attractions in South Iceland

The popular waterfall in Þingvellir National Park

When considering what to see in South Iceland, Reykjavík-based guests often feel limited to the attractions on the sightseeing routes above. 

Reaching the others requires multiple trips along the same routes, which is often undesirable when there are plenty of other sites in new areas. 

Those staying in a countryside hotel, however, are much better placed to seek out the less explored attractions of South Iceland.

Landmannalaugar is a great example; accessible only in summer, this spectacular mountain oasis in the southern Icelandic Highlands requires a special effort to reach. 

However, it’s well worth it for those who want to bathe in hot springs surrounded by otherworldly landscapes. 

Colourful Landmannalaugar in the highlands of Iceland

Skaftafell Nature Reserve is another; just off of Route 1, this former-National Park is a wonderland of glacier tongues, glacier lagoons, waterfalls and lava fields.

Closer to Reykjavík, before you reach the South Coast, is the hot spring valley of Reykjadalur. Guests hike from the quaint village of Hveragerði, often named ‘the earthquake town’ for its regular tremors, into the nearby hills. 

There they can find countless geothermal pools, and a warm river fed by them that you can bathe in.

Guests staying in south Iceland may even be inclined to take a ship to visit the Westman Islands, a volcanic archipelago off the South Coast that is renowned for its history of pirate attacks and eruptions. 

It is also the world’s largest nesting ground for Atlantic Puffins in summer.

Where to Stay in South Iceland

Beautiful church in South Iceland

As can be gathered by the abundance of things to see and do in South Iceland, being able to stay close to the sites is a blessing. 

Not only this, but much of South Iceland is a place of idyllic, rural beauty, allowing your holiday to the country to be the peaceful escape to nature than many are desperate to experience. 

Setting up a base far from urban areas also will provide you with countless opportunities to seek out the Northern Lights if travelling between September and April. 

Northern Lights in the south of Iceland

Furthermore, even in the remote parts of Iceland’s nature, you will still have a few settlements within a short drive where you can find basic services. 

In southwestern Iceland, for example, the village of Selfoss will have everything you need.

Whether you are looking for lavish lodgings or a simple cabin, travelling in winter or summer, coming alone or with a large group, you’ll find a cottage or bungalow to suit your needs. 

Below are ten fantastic options, listed in no particular order, that may be the perfect base for your holiday to south Iceland.

The Hrosshagi Cottage

Hrosshagi is a cottage surrounded by natures
Credit: Hrosshagi Cottage

Humble and homey, the Hrosshagi Cottage is a fantastic abode for small groups who want to be perfectly positioned to explore the Golden Circle; it is very close to both Gullfoss and Geysir. 

Its location is even more desirable for those who want to indulge in Iceland’s hot spring opportunities, as it sits between the villages of Flúðir and Laugarvatn, homes of the Secret Lagoon and Fontana Spa respectively.

Hrosshagi has one bedroom and one bathroom; it is thus ideal for solo travellers, couples and small families, though can sleep up to six. 

Its decor is that of a classic log cabin, with bunk beds, wood panelling and a sheltered veranda, providing an ambience that could not be further from Reykjavík’s hustle and bustle. It also has its very own hot tub.

In summer, Hrosshagi is immersed in greenery, with its surrounding trees vivid in colour; their positioning also encloses the cottage, adding to the privacy and sense of escape. 

In winter, meanwhile, it becomes a wonderland of untouched snow and ice, and thus a perfect place to get into the festive season or admire Iceland’s subarctic climate while still feeling warm and cosy.

The Nupar Large Cabin

The Nupar Large Cabin bears many similarities to Hrosshagi, it is perfect for small groups, with a capacity for five guests. 

Its decor is that of a rustic log cabin, it has a personal hot tub and it can be booked throughout the year. There are several qualities that distinguish it, however, and may make it more desirable for certain travellers.

Firstly, it has two bedrooms, making it less appealing to solo travellers and couples, but more so to small groups, families with older kids, and double-dating pairs. 

Secondly, it is further south, making the coastline more accessible but the Golden Circle slightly less so. 

Thirdly, it is not quite so secluded; though far from urban areas, there are a few other cabins around it. While this may make it less private in general, it provides opportunities to meet other travellers or for larger groups to split up and have their own spaces.

The Helgafell Cottage

Helgafell is perfect for a big group travelling in the south of Iceland
Credit: Helgafell

The Helgafell Cottage has all the rustic appeal of Hrosshagi and Nupar, including a hot tub on site, with just a little more space. 

Able to sleep up to eight, in three bedrooms over two floors, it makes for the perfect getaway for groups of friends or larger families.

The guesthouse is named after the great, historic hill that it overlooks; this, along with the fact that there are few buildings in the vicinity, makes the views and surroundings here particularly special. 

Located roughly in the middle of the settlements of Selfoss, Flúðir and Laugarvatn, both the Golden Circle and sites of the South Coast are within comfortable driving distance. 

It is also one of the closest cabins to the aforementioned Sólheimar Ecovillage, a centre of Icelandic sustainability and creativity.

The Cedar Log Cabin

Cedar Log Cabin on a beautiful day
Credit: The Cedar Log Cabin

Just because you are travelling in a small group and want to stay out in Iceland’s nature does not mean you have to compromise on space and privacy; nowhere is this clearer than at the Cedar Log Cabin

With four bedrooms but facilities for just six guests, all travellers will be able to socialise in the roomy communal areas and hot tub, and retreat for some alone time when needed.

The Cedar Log Cabin is near enough to Selfoss that accessing all necessary services is a breeze, but far enough that the settlement is not in sight. 

All that surrounds it is idyllic nature, including spectacular mountains, rushing waterways, and rural bliss.

Its location is right on the cusp of the Golden Circle.

The Lundur Cottage

Lundur Cottage has a unique style located in the south of Iceland
Credit: Lundur Cottage

The Lundur Cottage breaks the tradition of the cabins listed thus far in the fact that its design is radically different. 

While those above are rustic, classic and romantic, Lundur is sleek and modern, with several walls of glass and a chic, angular style. It thus has appeal to those who seek to maintain all modern comforts both in reality and illusion, while still being immersed in nature.

In spite of its less conventional design, it still has more traditional features of an Icelandic guesthouse than many others; for example, it does not just have a hot tub, but also a sauna. 

While the adults can enjoy this unique feature, the kids can fool around in the playpark in the garden.

Guests can enjoy the sauna at Lundur Cottage
Credit: Lundur Cottage

Considering these facilities, the three bedrooms, and capacity for six, the Lundur Cottage suits families and groups of friends in equal measure.

Sitting on the edge of Þingvallavatn, the Lundur Cottage boasts beautiful views over Iceland’s largest natural lake and easy access to Þingvellir National Park on the Golden Circle.

The Giltun Cottage

Giltun Cottage has beautiful views
Credit: Giltun Cottage

Nestled just off the Ring Road by the geothermal valley of Reykjadalur, Giltún Cottage is a fantastic base for those who enjoy hiking and hot-spring bathing. 

It also boasts equal accessibility to Reykjavík, the Golden Circle and the South Coast.

Though smaller than many of the other log cabins on this list with just two bedrooms, there are facilities for up to eight guests. 

This makes it a fantastic choice for larger groups – particularly on a budget – who don’t mind squeezing in together. Couples and smaller families, meanwhile, will find its appeal in its excellent location, plentiful amenities, and sheltered hot tub.

The Rosenberg Cottage

View from Rosenberg Cottage
Credit: Rósenberg Cottage

The two-bedroom Rósenberg Cottage provides a perfect escape from the stresses of modern life. 

By the choice of its owners, it has no wifi or television, meaning your holiday can be focused on building up bonds with your fellow travellers, basking in the hot tub, enjoying Iceland’s landscapes and the silence of nature.

Rósenberg sits on the banks of the river Sogið, and its veranda provides wonderful views over the rushing water and mountain backdrop. 

There are very few other buildings in the area, in spite of the fact that it is less than an hour’s drive from the sites of the Golden Circle.

The cottage only has space for four, making it perfect for smaller families. Its style is modern, spacious and simple.

The Minniborgir Cottages

Minnirborgir is perfect for those who are travelling around the Golden Circle
Credit: Minniborgir Cottages

While most of the cabins and guesthouses in south Iceland boast their remoteness and isolation, the Minniborgir Cottages take a different approach. 

Though they are surrounded by the nature of the Golden Circle route, there are seven next to each other, centred around a restaurant. 

Each cabin has three rooms, two bathrooms, its own hot tub, and capacity for nine people.

The Minniborgir Cottages, therefore, have a much broader appeal than many other cabins. 

Though your family or friends may want to book one and treat it like any other bungalow, if you are part of a larger group then you can book several. 

This allows you and many companions to lodge all in the same area, which can be difficult outside of Reykavík and other large towns in many cases. 

As such, these cottages have a particular appeal to those on work trips or family reunions.

The Merkurhraun Cottage

Merkuhraun is a big fully equipped cabin located near Hella
Credit: Merkuhraun Cottage

Closer to Hella than Selfoss, the South Coast is more accessible to those staying at Merkurhraun Cottage than the aforementioned guesthouses and bungalows. 

That, however, is not its only appeal; with two stories, four bedrooms, spacious living areas and a large hot tub, it can comfortably house eleven people, making it perfect for family gatherings or big friend holidays.

Merkurhraun combines the classic feel of a log cabin with the modernity of a newer build. While wood paneling, rustic furnishings and plenty of outdoor features are intrinsic to its design, it also has large windows to make the most of the sunlight and a bright, chic kitchen. It also boasts two balconies.

Due to the trees that surround it, and the distance of the surrounding towns, Merkurhraun has a distinct air of privacy and isolation.

The Alftaver Cottage

Alftaver Cottage is a cute cabin surrounded by nature
Credit: Álftaver Cottage

Concluding this list is a bungalow like no other. While the previous nine holiday homes were all in southwest Iceland, an hour-and-a-half from the capital of Reykjavík, the Álftaver Cottage can be found between Vík and Kirkjubæjarklaustur, in the centre of the South Coast.

This position makes Álftaver the best place to stay in south Iceland for those who want easy access to sites such as Reynisfjara beach, the Landmannalaugar Highland oasis, Skaftafell Nature Reserve and the spectacular Jökulsárlón glacier lagoon. 

The compromise of this, of course, is that the Golden Circle is further away.

Guest can enjoy the countryside's view at Alftaver
Credit: Álftaver Cottage

Álftaver is a particularly small cottage, with one bedroom and a maximum capacity of three. 

While this makes it defective for larger family and groups, it is a perfect place to form a base if travelling alone, as a couple, or with just one or two friends. 

Because of its smaller size, it misses out on a few features of those above, most notably a hot tub. However, with its incredible surrounding nature and accessibility to the sites, this is a concession many are willing to make.

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