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  • Writer's pictureScandinavian Travel

Is Iceland Expensive? A Comprehensive Guide

Iceland is a dream destination for many travelers, renowned for its stunning landscapes, unique culture, and vibrant city life. However, a common concern is “is Iceland expensive?” In this guide, we will explore various aspects of costs associated with visiting and living in Iceland, providing you with detailed insights to help you plan your trip or move.


Tourists doing trekking in Iceland which does not require any cost

The cost of traveling in Iceland


Accommodation


One of the most significant expenses when traveling in Iceland is accommodation. Options range from budget-friendly hostels and guesthouses to mid-range hotels and luxury lodges. On average:


  • Hostels and Guesthouses: Prices range from $30 to $70 per night for a dorm bed or basic room.

  • Mid-Range Hotels: Expect to pay between $100 to $200 per night.

  • Luxury Lodges: Prices can exceed $300 per night.


One of the most economical ways to travel around Iceland and experience its beauty is by renting a camper with Camper Rental Iceland. This option not only combines transportation and accommodation but also allows you to explore the country at your own pace, making it a popular choice among budget-conscious travelers.


Pile of icelandic krona - is Iceland Expensive for Travelers?

Food and drink


Eating out in Iceland can be quite pricey. Here’s a breakdown of typical meal costs:


  • Budget Meals: Fast food or casual dining options like hot dog stands or fish and chips cost around $10 to $20.

  • Mid-Range Restaurants: A meal at a standard restaurant ranges from $25 to $50 per person.

  • Fine Dining: High-end restaurant meals can cost upwards of $100 per person.


For those on a budget, grocery stores offer a more economical option, with many travelers opting to prepare their meals. Some popular grocery stores include Bónus, Krónan, and Nettó, where prices are relatively lower.


Transportation


Getting around Iceland can be another major expense. Options include renting a car, taking public transport, or joining guided tours.


  • Car rentals: Depending on the season and car type, rental costs can range from $50 to $200 per day, not including fuel. Renting a 4x4 vehicle can be more expensive but is often necessary for accessing remote areas.

  • Public transport: Bus services are available but limited outside Reykjavik. A single fare within the city costs around $4. The Reykjavik City Card offers unlimited bus travel and access to several museums and thermal pools.

  • Guided tours: Prices vary widely, but day tours typically range from $50 to $150 per person. Multi-day tours can be more cost-effective and include accommodations and meals.


Attractions and activities


Many of Iceland’s natural attractions are free to visit, such as waterfalls, hiking trails, and scenic drives. However, some popular activities come with a fee:


  • Blue Lagoon: Entry fees start at around $60.

  • Glacier Hikes and Ice Climbing: Tours range from $100 to $300.

  • Whale Watching: Prices are typically between $80 and $120.

  • Northern Lights Tours: Prices start at around $50 and can go up to $200 depending on the package.


To save money, consider exploring free attractions and taking self-guided tours.


General tips to save money


Travel Off-Season: Visit during the shoulder seasons (spring and fall) to find lower prices on flights and accommodations.

Self-Catering: Stay in places with kitchen facilities to save on dining costs.

Use Public Transport: When possible, utilize public buses or shared tours instead of renting a car.

Purchase a Reykjavik City Card: This card provides free access to museums, galleries, and public transportation within Reykjavik.



Is Iceland expensive to live in?


Living in Iceland, especially in Reykjavik, can be quite costly. Here’s an overview of common living expenses:


Housing


Housing is the largest expense for residents. The cost varies significantly based on location and type of housing:


Renting: A one-bedroom apartment in Reykjavik costs between $1,200 and $1,800 per month.

Buying: The average price per square meter in Reykjavik is around $5,000.


In smaller towns and rural areas, housing costs are generally lower.


Utilities and Internet


Monthly utility bills, including electricity, heating, cooling, water, and garbage, for an 85m² apartment are about $150. High-speed internet costs approximately $70 per month.


Groceries


Grocery prices are higher than in many other countries. A typical weekly grocery bill for a single person can range from $60 to $100. Some average prices include:


  • Milk (1 liter): $1.50

  • Bread (500g): $3

  • Eggs (12): $5

  • Chicken Breast (1kg): $10


Shopping at budget supermarkets like Bónus can help reduce costs.


Transportation


Owning a car is expensive due to high fuel costs and taxes. Gasoline is around $7 per gallon. Alternatively, a monthly public transport pass in Reykjavik costs about $90. Cycling is also a popular and economical option in the city.


Healthcare and Insurance


Iceland’s healthcare system is publicly funded and offers high-quality care. Residents pay a nominal fee for services, and private health insurance is also available. Health insurance costs approximately $50 per month.


Education


Education in Iceland is free for residents, including university-level education, making it an attractive destination for families. International schools and universities may charge tuition fees for non-residents.


Taxes


Iceland has a progressive tax system. Income tax rates range from 22.5% to 31.8% depending on income levels. Additionally, a municipal tax of up to 14.52% is applied.


tourist overlooking the landscape -is Iceland Expensive for Travelers?

Is Iceland expensive to live?


Given the high cost of housing, food, and transportation, living in Iceland is expensive compared to many other countries. However, the high standard of living, excellent public services, and stunning natural environment can make it worthwhile for many.


Frequently Asked Questions


Is Iceland expensive for tourists?


Yes, Iceland is considered an expensive destination for tourists. Accommodation, dining, and transportation costs are higher than in many other countries. However, with careful planning and budgeting, it is possible to manage expenses and still enjoy a memorable trip.


What does an average meal cost in Iceland?


An average meal in a mid-range restaurant costs around $25 to $50 per person. Budget options like fast food and casual dining can cost between $10 and $20.


Is Iceland expensive to eat and drink?


Yes, eating and drinking in Iceland is expensive. Dining out at restaurants is particularly costly. Grocery shopping and cooking your own meals can help reduce food expenses significantly.


So, is Iceland expensive? The answer is generally yes, but the unique experiences and breathtaking landscapes can justify the costs for many visitors and residents. By planning ahead and being mindful of expenses, you can enjoy all that this incredible country has to offer without breaking the bank. Whether you’re planning a short visit or considering a longer stay, understanding the costs involved will help you make the most of your time in Iceland.

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