By Mike Pedley

Iceland’s economy may have hit the rocks but its pocket-sized capital still knows how to throw a party.

Reykjavik must be one of the world’s smallest capitals : on a global scale it hardly counts as more than a village. But this quirky pint-sized city has a maverick outlook on life – who wouldn’t when there are glaciers and volcanoes practically in the backyard and the Northern Lights shimmer overhead. If its reputation for fierce prices has put you off visiting in the past, now is the time to go, while the Icelandic kronur is still on its knees.

That said, hotel prices are still hardly in the bargain basement, but a long weekend taster will provide plenty to keep you busy – checking out its brain-expanding museums and art galleries, hanging out in hip cafes, indulging in retail therapy without the frightening pre-crisis prices. Then there’s the capital’s famously mad nightlife. After a night on the town, you will need a blast of pristine Icelandic air to restore full brain function.

As it happens, some of the country’s must-see sights are within easy reach of Reykjavik, and  to come to Iceland and miss seeing its other-worldly landscapes would be a real shame. This is the northernmost capital city on the planet: splendid isolation lies just a short drive away, among magical glaciers, snowy peaks and surreal volcanic  coastlines. Stand and stare across the wild ocean from a black sand beach and reflect that the nearest neighbours are Greenland and the North Pole.

AN ORIENTATION WALK

First job in a new city: get your bearings. Reykjavik’s history began out at sea when Vikings turned up to establish settlements at the edge of the icy wilderness in the 9^th century. So I kicked off my walk through the city’s highlights down in the harbour – not that the industrial modern harbour is much to look at in itself. It is built on reclaimed land, which has pushed the historic waterfront a couple of blocks inland.  Still, it’s worth a visit for a snack at the Seagreifin café, a sort of spit-and-sawdust  fishmonger-cum-restaurant serving grilled kebabs of fish with potatoes. I order  lobster soup and bread, which really hits the spot sitting at a trestle table out on the working quayside. Walking along the dock, though, I see something that leaves a bad taste in the mouth. Moored up near the whale-watching day boats are three beaten-up whalers stained with tears of rust – they have a red ‘H’on the funnel, standing for ‘Hvalur’. For anyone disgusted by the anachronistic barbarism of whaling – there’s something just plain wrong about hunting whales commercially while selling eco-friendly whale-watching trips to tourists. For god’s sake Iceland, you’re a forward looking 21^st-century nation: why do you persist in killing whales?

It’s Saturday, so I scout around the weekend  Kolaportið flea market, which is hiddden away in an unpromising-looking warehouse on the sterile harbour strip. Actually, it’s not half bad, packed with quirky stalls laden with bric-a-brac, salt cod and second-hand books – you can even buy evil-smelling hákarl – Iceland’s nauseating putrefied shark meat ‘delicacy’.

I cross over into the heart of the bohemian old town, which is known by its des-res postcode, 101 Reykjavik. The tourism information centre is quite a landmark at the centre of a cluster of buildings dating from the 18^th century along Reykjavik’s oldest street, Aðalstræti. I find this hard to believe – so far Iceland looks like a land with no history – have these corrugated metal houses really been here for two centuries?. There is something about these simple buildings decorated in child’s paintbox colours that makes Reykjavik feel like a pioneer township that sprung up last week. The buildings become rather more substantial and full of a sense of their importance aound the corner in Austurvöllur Square: the historic AlÞing parliament house is a dour grey lump next to the pretty Lutheran cathedral – yes, that’s that dinky little church with a grandiose title. Make sure to pop into the gorgeous art deco Hotel Borg too.

The penny has dropped by now: I’m starting to realise that Reykjavik really is just an overgrown village, and to confirm this impression, I wandered over to Tjörnin – the city’s ‘village pond’ – to join the locals, who are out in force feeding the water birds,  a very pleasant  people-watching interlude as long as you keep an eye open for squadrons of divebombing Arctic terns overhead, while simultaneously looking down to avoid coming a cropper in the copious amounts of duck and goose poo underfoot.

Next, I cut back across the square to the start of the main drag of Austurstræti. From here, things slow down – there’s an unbroken strip of shops, cafes and bars heading up the hill, and the street changes its name as I climb, becoming Bankastræti, then Laugavegur, the epicentre of all the shopping and eating action. It’s a great place for aimless browsing – plenty of quirky craft and fashion boutiques; shall I get one of those fluffy puffins as a prezzy? Despite the shell-shocked economy, prices are still pretty sky-high, so I decide to indulge in nothing more than window shopping. Branching off into tongue-twisting Skόlavörđustígur, there’s a classier street of art galleries, jewellers and designers to check out than the tourist tat; stylish jewellery made from Icelandic jasper is pretty unique, but – aha! – that’s what I was after:  the Handknitting Association of Iceland’s shop is stacked high with those chunky patterned traditional lopi jumpers, you know, you even see Björk and the lads from Sigur Rós wearing them so they can’t be totally uncool.

Snug in the new woollie, I push on to the city’s iconic spire. The wind is blasting around the square as I give a nod to the statue of Leifur Eiríksson, the little-known Viking who actually discovered America 500 years before Columbus turned up, dwarfed beneath the space rocket steeple of Hallgrímskirkja. This striking concrete landmark is supposed to look like an erupting lava flow, but to a lad brought up on sci fi, it can only ever look like it is about to blast off into space. I learn that is named after Hallgrímm Pétursson, a 17^th-century priest, poet and writer of Icelandic hymns, before taking the lift to the top to see the townscape laid out like a child’s paintbox in blocks of primary colours, hemmed by the sea and distant snowy mountains.

But this is the sober light of day, when I’m seeing Reykjavik on its best behaviour. After seeing the place in party mode on Friday and Saturday night, and taking part in the hardcore bar crawl known locally as the rúntur, I have seen the other side of the city. Drinking is so pricey here that locals usually kick off the evening with a few sharpeners at home to keep down the eye-watering cost of a boozy night, before setting off to stumble between the bars of downtown Reykjavik 101. I saw a group of lads dressed as vikings in full chain mail, and even a coven of girly witches. Monster 4×4 superjeeps and stretch Hummer limos packed with squealing girls out on the town cruised up and down the Laugavegur strip -it’s all pretty boisterous, but things don’t generally get out of hand, and it’s an unmissable part of the Reykjavik scene.

Reykjavik’s best museums and galleries

You can really overload on Icelandic culture and oddball art in Reykjavik, but try not to spend all your time indoors. If you’re planning to visit several of the museums, make sure to buy a Reykjavík Tourist Card. They are available for 1, 2 or 3 days duration, and cost: 24 hours – 1200 ISK; 48 hours – 1700ISK: 72 hours – 2200 ISK. As well as entry to the National Museum, Reykjavík Art Museums and the National Gallery, you get entry to several other sights, including all thermal pools and use of public transport. I’ve included the name of each place in Icelandic script in brackets so you know you’re at the right place.

The National Museum (Þjöđminjasafn Íslands) Suđurgata 41. So what do you really know about Iceland apart from the fact that Björk and Mastermind Magnus Magnusson come from there? Did you know, for example, that it once belong to the Danes?  No, me neither until I spent half a day in this state-of-the-art museum. This one really is a must to get a handle on Iceland’s enigmatic past – there’s 1200 years of Viking, Celtic and Icelandic artefacts on display, including the fully excavated and relocated grave of an ancient warrior buried with his horse. Elsewhere are intricately-sculpted drinking horns, glass and amber jewellery.

Culture House (Þjöđmenningarhúsiđ) Hverfisgata 15. Tolkien found inspiration in the Icelandic tales of heroes and gods for his Lord of the Rings novels. The Viking-age sagas are so deeply woven into Iceland’s cultural fabric  that saga reading was still going strong as popular entertainment well into the 20^th century, and the original sagas are collected here in a grand listed building that opened in 1909.  Among its many treasures are 14^th-century translations of the Old Testament with beautifully illumainated margins, as well as the original Jonsbok and Gragas, the 13^th-century medieval calfskin vellum manuscripts that are the basis of the Icelandic legal code. The illuminations are miniature masterpieces, painstakingly created by long-suffering monks who surrreptitiously recorded their boredom and discomfort for posterity in notes in the margins: ‘writing bores me’, says one brother, while another whines on at length about ‘how difficult it is to be a scribe, it dulls the eyes, constricts the kidneys and torments the joints as well – three fingers write, the whole body suffers’.

Reykjavik 871±2 – The Settlement Exhibition. Aðalstræti 16. During excavation work in 2005 for the Hotel Reykjavik Centrum next door, this major archaeological site came to light. It turned out that  the original Viking longhouse built by Norse settlers, who came to Iceland in the 9^th century for a life free from the tyranny of King Harald Fairhair, had been lying beneath the feet of Reykjavik’s citizens for the last 1200 years. The atmispheric new museum opened in May 2006 with a superb display of Viking-age artefacts: axes, arrowheads and fish hooks, as well as walrus tusks and Great Auk bones, are displayed around the central longhouse. The story of the pioneers is told in the Book of Settlements in the Culture House

Reykjavik Art Museum (Hafnarhúsið) Tryggvagata 17. This modern gallery down near the harbour is arguably the best of Reykjavik’s galleries. Its number one draw is the maverick creativity of Icelandic cartoon artist Erró. His art features iconic figures such as Marilyn Monroe cast as a cinema usherette serving ice cream to Chairman Mao; elsewhere he brings together Bugs Bunny and Bulgakov, and transposes ranks of muscular Russian, Chinese and Cuban communist heroes marching across St Mark’s Square in Venice. Images from Picasso and Van Gogh are given a cartoon spin too.

Kjarvalsstađir Flókagata, 105 Reykjavík. Iceland’s favourite painter Jóhannes Kjarval caoptures the other-worldly beauty of Icelandic landcapes in evocative storms of swirling colour

Ásmundur Sveinsson Sculpture Museum Sigtún, 105 Reykjavík. The Icelandic sculptor’s works are inspired by Viking sahas and legends, with a bit of Cubism and Soviet heroism thrown in for good measure. Worth the trip just to wander in the stark white serenity of the curving crescent gallery and domed igloo-like studio

National Gallery (Listasafn) Check out the website to see  what’s currently on display, as the National Gallery puts on continually-changing exhibitions of contemporary Icelandic artists

The Pearl The futuristic landmark on top of Oskjuhlið Hill looks like a cross between a  domed observatory and space-age oil storage depot. The vast tanks actually hold the geo-thermally heated water for Reykjavik’s homes and under-pavement heating system that keeps the footpaths ice free in winter. The 4^th floor has a 360 degree wraparound viewing platform, and the place is packed with places to lighten your wallet. When you’re spent out, it’s a short walk from here to the heated pools at Nauthólsvík Beach.

Laugardalslaug thermal baths. Sundlaugavegur 30. This is the place to join the good citizens of Reykjavík in an activity that is dear to the Icelandic heart – swimming in the billowing steam of its largest thermal pool. The complex is a rather dreary industrial concrete setting, but you soon forget that as it disappears in steamy clouds. There’s quite a strict pool etiquette that requires you to shower thoroughly in the buff, before you put on your cozzie and go for a dip.

HIGHLIGHTS OF ICELAND

BLUE LAGOON AND REYKJANES PENINSULA

After a few days of Reykjavik’s brain-scrambling pleasures I was ready for a hit of fresh air and keen to see the jumbled chaos of lava fields out on the Reykjanes Peninsula. I’d recommend getting something with four wheel drive as there are some rough sections of unmetalled road to deal with. After visiting the Salt Fish Museum in Grindavík (see below) I headed west to Gunnuhver on the peninsula’s western tip, where sulphurous hot springs spew out eggy clouds of steam. Next I crossed the bridge over to America: no, the chemicals hadn’t addled my brains – the rift between American and Europe isn’t just a cultural one here in Iceland – there’s a clearly visible fault line where the American and European tectonic plates are drifting apart, leaving a deep slash through the lava wilderness.  Heading east, I skirted a primeval coastline of lava cliffs hacked into crazy formations where the sea stopped the red hot flow countless years ago. I pushed on through mournful expanses of jumbled lava cloaked with lime-green lichen to visit the ruins of a primitive fishing settlement at Selatangar, where it really hits home that Icelanders were once an incredibly tough bunch of characters to scratch a living in this post-apocalyptic landscape, lost among the peaks of dead volcanoes, impassable lava fields and the icy waves of the North Atlantic. There are kittiwake and puffin nesting sites here too for the twitchers. After pausing to check out another bunch of hissing hot springs with glooping craters of boiling mud at Seltún, I finished by the shores of eerie Lake Kleifarvatn, before heading back to poach in the Blue Lagoon.

The Blue Lagoon’s mineral soup water will guarantee you have a bad hair day, but you do get a free facial as compensation – just scoop up handfuls of gloopy grey silica mud from the bottom of the pool for a free face-mask that will do wonders for your complexion. Most of the pictures you see of the Blue Lagoon don’t tell the full story: yes, the creamy turquoise lagoon in the middle of cinder-black lava fields is an amazing sight, but what really makes it truly bizarre is the sci-fi backdrop of the Svartsengi geothermal power plant. if you just want a dip, frequent Keflavík airport shuttle buses will drop you off just up the road, but it’s a much better idea to hire a car and spend a day exploring the ravaged beauty of the lava fields and the elemental coastline of the Reykjanes Peninsula. You can’t miss it – the Blue Lagoon is clearly signposted off the main road between Reykjavík and Keflavík airport, and you just head for the industrial power station!

Grindavík

On the way out from Reykjavik to the Blue Lagoon and Reykjanes Peninsula, make sure to take a detour to Grindavík. It’s a workaday fishing port with a sizeable trawler fleet and a brilliant museum that celebrates the humble saltfish. Salt cod may not seem like a sexy subject, but it is a fascinating insight into Icelandic traditions. The stuff is so rooted into the country’s past and prosperity that a cod was a part of Iceland’s coat of arms until 1904. Back in those days, fish was in huge demand all over Europe during church fasts (anyone remember the days of ‘fish on Friday’?) so Iceland grew rich. Believe it or not, salt cod is still a major prop to Iceland’s economy in the 21^st century, accounting for up to 60% of its exports each year – and who knows what the future holds now that the bankers have bankrupted the nation.

THE GOLDEN CIRCLE

If you have the time and budget to stretch a Reykjavik short break into a slightly longer mini-tour of Iceland’s highlights, don’t miss the so-called Golden Circle tour. This circuit of Iceland’s top tourist trio is big business with Reykjavik’s bus companies. If time is limited and you don’t fancy driving, it can be done in a long day trip. However, if like me, you don’t want to do it with a herd of 50 strangers on a coach, it’s easy to travel independently in a hire car, and you don’t need four-wheel drive if you stick to tarmac roads. But I went for a 4X4 and this really added to the sense of adventure as I was able to travel on unsurfaced tracks and get a real feel for Iceland’s dramatic wilderness on the doorstep of the capital. Another plus is that you can concentrate on what interests you most and sidetrack off to see things that aren’t on tour group itineraries such as the historic church and dramatic volcanic crater at Kerid near Skalholt.

Thingvellir (Þingvellir) On this dramatic site straddling the rift between the European and North American continental plates, Iceland’s first parliament was established in 930AD. The Great Edict of 1564 laid down a strict moral and legal code on a previously lawless land. Punishments ranged from fines to flogging, and for ‘the worst cases of incest’ men were beheaded and women drowned. What fun life was back then! For a thousand years, all of Iceland’s important national events and gatherings, including the adoption of Christianity in the 11^th century and the declaration of a republic in 1944 have taken place at the black cliff known as the Lögberg, or ‘Law Rock’. It looms high above grassy meadows where medieval feasts and fairs were held, as well as the grimmer business of public beheadings and drowning transgressive women in the icy pools of the Óxará river. There are no specific monuments to see at Thingvellir, it’s just an atmospheric place to wander.

Geysir The name doesn’t seem very inventive at first, but you have to remember that this is not just any old geyser, but THE original Geysir whose name gets used for steaming spouts of water all over the world. The original doesn’t work any more – maybe all the soap powder dumped into it by tour guides over the years in order to induce eruptions put it out of action. The one everyone turns up to visit now is called Strokkur – get up nice and close, you won’t have to wait long: after a few dyspeptic belches and bubbles, get your camera at the ready as the turbulent water rises up into a dome just before blowing its top, and yee harr, thar she blows,  blasting a boiling plume up to 30m high every 5 minutes or so.

Gullfoss Ok, it’s just a waterfall, and it’s no Victoria Falls either, but Gullfoss is a damn sight more impressive than anything you’ll see in the UK. The 30-metre-high double falls plunge in a thunderous torrent down a canyon slashed in the Hvita River It has to be said, though, that in the flesh, the ‘Golden Falls’ can’t live up to the promise of those spectacular photos in all the guidebooks.

SNÆFELLSNESS PENINSULA

This wild, heart-breakingly beautiful spine of mountains ends at the magnificent Snæfellsjökull glacier, jutting into the Atlantic 180km north-west of the capital. Professor Lidenbrock and his companions in Jules Verne’s Journey to the Centre of the Earth entered through this stunning ice cap to find their gateway to the earth’s core, and nowadays New Agers regard it as a mystical place, one of the earth’s great ‘energy centres’. For the less spiritually inclined, you can also have a real blast by zapping around the glacier on a snowmobile tour setting off from Arnarstapi – visit / for more information on tours of the area. If you prefer less white-knuckle pleasures, hiking along the cliffs of Snaefellsness is sublime – trek along to Hellnar and rewarded yourself with delicious fish soup by the waves in an end-of-the-world setting at Fjörhúsiđ cafe (see below)

DON’T MISS: Hellnar. Fjörhúsið Café. Tel 00354 435 6844. As it’s rather a trek – ie a couple of hours driving – out from Reykjavik, you’re not going to drop in as part of a city tour, but this little café in a hut that was a former salting house will stay in your mind long after you leave Iceland. It perches above a black volcanic sand beach on the wild Snæfellsness Peninsula in a location that feels like the end of the world. After a day spent snowmobiling on the Snæfellsjökull Glacier or walking the coastal cliffs at Hellnar, you couldn’t ask for a more stunning setting to tuck into great fish soup with home-made bread, or coffee with delicious home-baked cakes

THE NORTHERN LIGHTS

Unless you’re a polar explorer, or live somewhere like Orkney, it’s not often you find yourself this far north, so visiting Iceland is a rare chance to catch one of nature’s most spellbinding free shows. The Northern Lights, or Aurora Borealis,  are caused by solar wind particles hitting the earth’s magnetic atmosphere to produce ethereal wisps and spooky spotlights dancing across the crystal clear sky. Like most of the natural world’s phenomena, you’re never guaranteed a sighting. It’s all rather hit-and-miss: you might look up one night in the centre of Reykjavik and they are just there, but that’s not too likely. The Northern Light put on their best shows during the winter months between roughly October to March, and your best bet is to head into the countryside to escape the city’s light pollution, for starters. Choose a clear, cold night, and wait patiently from 9pm until midnight. Take a guided tours (around 7000kr per person) to increase your chances, as the experienced guides know the best parts of the countryside to be, and what to look for.

REYKJAVIK HOTELS – WHERE TO STAY

The huge influx of tourists brought in by increasingly frequent flights from the Uk and elsewhere in Europe means that hotels in Reykjavik never have to go looking  for customers. Prices have come down to a more affordable level since the economic crash, but are still far from cheap. Hotels often price rooms in euros as well as Icelandic kronur. The price guide rates below are for summer high season rack rates quoted online for a standard double room. It’s always worth checking for online deals, or phoning hotels direct to see if you can bag a discount; otherwise try tour operators and websites such as www.lastminute.com and www.expedia.com to look for cheaper deals.

Hotel Borg Posthusstræti 11. Tel 00 354 551 1440. If you want a hotel in Reykjavik that feels as if it wasn’t built last week, go for this dignified old grande dame of a hotel. Hotel Borg was around long before the word ‘minimal’ came into the designer vocabulary, and makes a refreshing change from the identikit herd of stripped-out contemporary hotels all over the capital.  Art Deco glamour is the order of the day here, delivered in spades right from its revolving mahogany doors opening into the parquet and marble extravaganza that is the lobby. Luxurious bedrooms are cleverly brought into the 21^st century with the latest electronic gizmos, B&O flat-screen TVs, Philippe Starck fittings in the bathrooms plus top-notch touchy-feely materials combined with the graceful curves and lines of a 1930s cruise liner. The bar and restaurant are a snazzy affair of black and white mafia chic and camp glamour worthy of Las Vegas – just the place for a cocktail before joining the revellers for the weekend downtown bar crawl. Prepare for severe wallet damage if you fancy the Borg, but if you’re coming to Iceland, you’re probably not a backpacker looking for a hostel. Go for a splurge, and stay in this one-off pedigree joint that stands out from the crowd and you’re guaranteed great memories of Reykjavik.

Doubles from €310 / £277; 56 rooms

Facilities:

Room service 07:00-22:00; Laundry and dry cleaning same day service Monday-Friday: 24 hour internet access; Business centre; Meeting rooms; Massage service; Baby-sitting; Satellite TV; Xerox copying; Wake-up call; Currency exchange; Help with order of excursions, rental cars, theatre tickets, restaurants

Hotel Frόn Laugavegur 22. Tel 00 354 511 4666; Hotel Frόn is quite a cheapie by Icelandic standards, and you get sleek contemporary Scandinavian style and a central location smack on the main drag for your money. Despite the eclectic bag of buildings along  Laugavegur, this one really stands out with its space-age architecture – look for grey lava bricks, midnight blue walls,  zinc-barred balconies and glass panels, and you’re there. As soon as you’re in the lobby, you get the idea of what the rest of the building is like: clean-cut contemporary style in a minimalist Scandinavian vein. Bedrooms are all in good nick after recent refurbishment, kitted out with blond wood floors, pale oak furniture, bright modern art to add lively splashes of colour and immaculate shower rooms. If you’re looking to save a few quid, consider getting an apartment: these come with bijou kitchenettes with basic – but sufficient –  self-catering gear to sort out breakfasts and lunches, instead of eating out three times a day – rather useful for keeping a lid on costs in Reykjavík. Behind the hotel, a tranquil courtyard provides a haven from the frenzy out in the street: an annexe here also houses the breakfast room, where there’s a fine spread to start the day at stylish cherrywood tables with a friendly buzz in the air.

Doubles from ISK 19900 / £100; 72 rooms

Facilities:

Wireless, high-speed Internet access and computer rental; daily dry cleaning service; meeting facilities; use of DVD players; Parking is available by request and a daily fee; Room Service is served until 10 pm by the hotel’s restaurant the bistro Santa Maria for original Mexican food and cocktails.

Hotel Klöpp Klapparstígur 26. Tel 00 354 595 8510; All the sights, eating, drinking and shopping are right on the doorstep at Hotel Klöpp. This stylish modern sits just off Laugavegur, so the action is at hand, yet at arms length for a quiet night’s sleep. The spacious open plan lobby is quite a sociable place where you go for breakfast and to help yourself to free tea and coffee all day long – it’s a pleasant spot to hang out for a while, with oak floors and black leather bench seating. The bedrooms are far from shabby too: pale oak floors, doors and furniture, combine with chocolate brown curtains and walk-in shower rooms with black slate floors in a slick masculine look that won’t offend style slaves. Try to bag one of the rooms on the higher floors  that come with brilliant  views across the harbour to the snowy mountainous wilderness just a short adventure away.

Doubles from €165 / £147; 46 rooms

Facilities:

24 hours front desk – Multilingual Staff; Elevator/Lift; restaurants, bars, cafés and nightclubs within walking distance; Public Parking facilities in city-operated parking spaces and garages; Complimentary Breakfast Buffet served daily between 7:00 – 10:00; Airport Transportation with Flybus (surcharge) – www.flybus.is; Tourist information/tour assistance & reservations; Wake up calls; Safety Deposit box at reception; ATMs and banks within walking distance; Fax service & Photocopying; Laundry & dry cleaning service available through reception; All major credit cards accepted

Leifur Eiriksson Skόlavörđustígur 45. Tel 00 354 562 0800; With the sky-rocket steeple of Hallgrímskirkja as a landmark, right opposite the hotel’s entrance, you’ll never have problems finding your way home after a hard night on the town. The Leifur Eiriksson is a down-to-earth modern hotel that feels more easygoing and genuinely friendly than some of Reyjkjavik’s more self-consciously hip hangouts. The welcoming, family-run ambience helps enormously, and it’s a perennial favourite with British visitors. There’s a convivial open-plan lobby area where you can help yourself to complimentary tea and coffee and have a chat with other visitors, and bedrooms are simple and uncluttered in style, with bright modern art to inject colour and stop them feeling too spartan. Make sure to book one of the front-facing rooms if you want to start each day with a grandstand view of Reykjavík’s iconic soaring steeple.

Double ISK 21200 / £106; 48 rooms

Hotel Óđinsvé Óđinstorg. Tel 00 354 511 6200; Tucked down a quiet residential side street you could easily walk past Hotel Óđinsvé without realising it’s a hotel. Discreet, then, and better still, this slick bolthole is just a hop and a skip away from the shopping and drinking action along Laugavegur. Inside, there’s an easygoing, homely ambience, but style fans will not be disappointed by the clean-cut lines of its Scandinavian styling. The bedrooms go for a neutral modern décor that is not particularly memorable, but they are impeccably upmarket and comfy, and a high feelgood factor prevails throughout. Whether you stay here or not, foodies should take note that the in-house Siggi Hall restaurant is one of the best places you can eat in Iceland. Mr Hall is a celeb chef, a sort of Icelandic Rick Stein who has earned his place in Icelandic hearts by doing great gastronomic things with top-notch local ingredients, particularly fish, seafood and lamb. And even if the bill for dinner would blow your budget in one evening, you can at least get each day rolling with a superb breakfast buffet spread.

Doubles from ISK 27500 / £140; 43 rooms;

Facilities

Complimentary coffee and tea; free wireless internet connection; satellite TV; radio,  telephone, hair dryer in all rooms; 24-hr lobby service

Reykjavík Centrum Tel 514 6000. Ađalstræti 16; During construction of this hotel, the excavation work for a basement car park discovered the original Viking settlement that is now showcased in the Reykjavík 871±2 Settlement Exhibition next door. Hotel Centrum is a slick, stylish place, designed around a 19^th-century house – the result is a unique blend of old world charm and cutting edge contemporary comfort. The location is perfect too, right on a lovely square in Reykjavík’s oldest street with all the restaurants, bars and cafes on the doorstep. The old part of the hotel connects with the newly-built section through an expansive glassed-in atrium lobby: to one side, there’s an appealingly cosy bar with pine floor and wood-panelled walls and the feel of a log cabin; the restaurant (and breakfast room) across the othe side of the atrium have a more clean-cut contemporary ambience. Bedrooms in the older section have a more romantic mood, while those in the modern part have a slicker, minimal style. Whichever style you go for, all are fitted out with pine and oak, and classy, top-quality fabrics.

Price €225 / £200; 89 rooms

Facilities:

24 hour reception; All rooms are non-smoking rooms; In room: phone, PayTV, Satelite TV, iron & iron board; breakfast buffet; 24 hour Room Service; In-room Safety Deposit Box; Laundry Service; Restaurant; Lounge with café and bar services; Baggage Storage; Elevators; Shoe Shine Stand; Multi-Lingual Staff; Information desk about recreation and activities; City Information; Business Centre; Pay-phone in reception; Complimentary Printing Service; Meeting Rooms; Fax & Printer
Family and children friendly – Children’s Menu, Cribs, High chairs; Car Rental assistance

Skjaldbreiđ Laugavegur 16. Tel 511 6060; If you want to stay as close to ground zero as it gets, right on Laugavegur in central Reykjavík, Skjaldbreiđ does the job in style. It is an upmarket place with plush, spacious rooms, and, once inside, it’s hard to believe you’re right there in the thick of it: you enter the hotel above a chemists shop at street level, then it spreads through the upper floors of a characterful old building, all perfectly peaceful and cleverly insulated from the weekend bacchanal of the rúntur. A spacious conservatory extension at the rear serves as a breakfast room and laid-back lounge where you can help yourself to coffee and tea through the day. Bedrooms share a similar shipshape décor of pale wood, floral fabrics and white walls; fork out more for a superior room and you get more space and perhaps a grandstand view along the main drag. The hotel has its own convenient private entrance to the rather hip Vegamot café next door, but as it is a separate business, be aware that you can’t charge things to your room here.

Price €122 / £110; Rooms 33

Facilities:

24 hours front desk – Multilingual Staff; Elevator/Lift; restaurants, bars, cafés and nightclubs within walking distance; Public Parking facilities in city-operated parking spaces and garages; Complimentary Breakfast Buffet served daily between 7:00 – 10:00; Airport Transportation with Flybus (surcharge) – www.flybus.is; Tourist information/tour assistance & reservations; Wake up calls; Safety Deposit box at reception; ATMs and banks within walking distance; Fax service & Photocopying; Laundry & dry cleaning service available through reception; All major credit cards accepted

Grindavíkm Northern Light Inn Blue Lagoon Road. Tel 426 8650; Quick day trips out to the Blue Lagoon are all very well, but you won’t regret spending a night outside Reykjavík at the Northern Light Inn. First-off, you’re just a short walk from the Blue Lagoon, so you can lightly poach yourself in the evening session, when it’s not so packed with daytrippers, or be first in and have the place to yourself as soon as it’s open in the morning.  You wake up here in the middle of moss-carpeted lava fields, ready to set off and explore the surreal landscapes of the Reykjanes Peninsula. The sprawling ranch-style building is designed to give grandstand views of apocalyptic clouds of eggy steam swirling around the sci-fi geothermal power station that provides the Blue Lagoon’s water: settle into the chalet-style lounge, where a pine-clad ceiling and open stone hearth make for a comfy setting to take it all in. Meals in the excellent restaurant have the same apocalyptic views as a backdrop: it has full-length walls of glass jutting like a ship’s prow into the shattered fields of lava. After exposing yourself to the elements, bedrooms are spacious and cosy retreats, with squishy down duvets and pillows to guarantee a good night’s sleep. If you’re really in luck, the hotel could live up to its name: as you’re away from the light pollution in Reykjavik, the Aurora Borealis may well put on a shimmering light show before you nod off.

Price €190 / £170; Rooms 21

Facilities

All rooms have geothermal showers, satellite tv, direct dial phones, and free wifi internet access. Complimentary International Airport transfers & Blue Lagoon shuttles

WHERE TO EAT IN REYKJAVIK – RECOMMENDED RESTAURANTS AND CAFES

Trying to keep the food budget under control is a major bugbear in Iceland. Being a remote place covered in ice and snow, a good proportion of Iceland’s food has to be imported, which boosts prices sky high. They are good at catching fish, though, so there’s no excuse for that being as expensive as it is. The simple fact is that eating out in Reykjavík’s restaurants is going to hit you hard in the wallet. Wine is hilariously expensive too, so you’ll be lucky to get away with spending less than £50 per head for three courses with a (probably unexciting) bottle of wine in Reykjavik’s smart restaurants. If that kind of budget is simply off your scale, cafes offer cheaper snacky options – the ubiquitous pizza – and light meals. Supermarkets are about the cheapest way there is to fill up on daytime picnicking fodder – even then you’ll laugh at the prices of some items.

That’s the bad news. If you have a comfortable budget and an adventurous attitude to local delicacies, tuck into smoked puffin (tastes of smoke), guillemot (tastes of fish) and whale (tastes like liver – what do the Japanese, Norwegians and Icelandics get so excited about?!). I’ve eaten most things that swim, hop, fly, crawl, burrow, run, whinny and even bark, but one delicacy that managed to make me gag was the infamous hákarl, cubes of putrefied Greenland shark meat. Apparently you can’t eat Greenland shark until it has broken down through decay, so it is buried in quicklime to speed the process up, dug up and savoured. I found it hard to get the ammonia stench past my nose, and when I did, the taste was a blend of rotten fish and strong cheese….mmmm!….the accompanying shot of brennivín (firewater schnapps) at least helps to rid you of the taste and smell. And to think that the Icelanders use it as a hangover cure…

Away from the all-time gross category, the fish here is second to none – remember that Iceland still has a massive cod fishing industry – and lamb bred out on the icy pastures is top-quality stuff. Desserts often do good things with skyr, a sort of thick, creamy yoghurt.

Kaffi Sólon Bankastræti 7A. Tel 00 354 562 3232; Whiling away time in hip bars and cafés has been raised to an art form in Reykjavik. With huge full-length windows in a prominent spot for people watching on the main drag of Laugavegur, Sólon is the sort of immediately likeable place you’ll find yourself returning to again and again. It’s good at any time of day, from brunch to lunch, for afternoon coffee and cake or a full-on three-course dinner. A cosy brown and cream décor looks stylishly laid-back, just sink into a comfy seat and zone out to a soundtrack of cool music and choose from an extensive choice of globally-influenced dishes that runs from tapas to Italian, to Mexican, Asian and good old fish and chips. Mains range widely from the likes of grilled chicken breast with lime mustard sauce and pan-fried vegetables, to grilled garlic and rosemary marinated lamb with red wine sauce and pan-fried root vegetables or wild mushroom risotto with chicken, spinach and Parma ham. At weekends is goes a bit Jekyll and Hyde, morphing from a cool cafée-bistro to a beast of a night club that stays open until as late as 5am on Friday and Saturday, with some of Iceland’s hottest DJ’s to crank up the volume for the party people.

Main courses 2000 – 3950 ISK

Þrir Frakkar Baldursgata 14. Tel 552 3939; Hidden away in a quiet neighbourhood just a short stroll from central Laugavegur, this is a cosy and convivial place divided into several small rooms that have feel of eating at a friend’s place. The decor is quirky and eclectic – stuffed salmon and ram’s heads hang on the walls, together with gilt mirrors and glass fishing floats. The kitchen majors in Icelandic specialities, with a clear leaning towards fish and wild ingredients, so this is your chance to try some unusual dishes that you’re not going to see very often outside of Iceland. You could kick off with smoked puffin breast with mustard sauce or Japanese sashimi-style raw whale meat, ahead of main courses such as fillet of catfish with king crab sauce, wild guillemot breast with game sauce or a traditional Icelandic speciality of hashed fish with black bread. Finish with a rich creamy skyr crême brûlée, or crêpes with honey, cream and Grand Marnier marmalade, and wash it all down with a shot of flavoured brennivin schnapps. In case you were wondering, the name means ‘3 Overcoats, by the way.

Mains ISK 2950-4000

Tveir Fiskar Geirsgata 9. Tel 00 354 511 3474; Icelandic fish is some of the best you’ll find anywhere in the world. Established as one of the city’s top restaurants – and therefore eye-wateringly expensive – ‘Two Fishes’ is worth splashing out on for a special meal. The industrial harbourfront location is no oil painting, but the dockside is apt for the fish-oriented menu. Inside, things look up: the interior is rather romantic and intimate, in a minimal contemporary sort of way. Tables are candlelit in the evening and decorated with a single rose, while pine floors and wooden chairs and tables add in nice textures. What’s on offer is modern Icelandic cuisine from a kitchen that is passionate about sourcing the best local fish, meat and game it can get its hands on, and subjecting it to French classical techniques to produce dishes with well-balanced, uncomplicated flavour combinations. To start, salt cod might be given a Mediterranean spin, teamed with a Parmesan crust, sun-dried tomatoes, olives and tomato vinaigrette, or you could go for an Icelandic take on bouillabaisse. Mains might be roasted monkfish with wild mushrooms and port wine balsamic syrup, or potato-crusted cod with truffle oil and Madeira sauce. As a sop to carnivores, venison tenderloin is seved with butter-fried asparagus and thyme and port sauce. Local ingredients are treated simply once more at dessert – perhaps chocolate mousse with raspberry skyr sorbet.

Mains ISK 3000-5000

Við Tjörnina Templarasundi 3. Tel 00 354 551 8666; This place makes a refreshing change from Reykjavik’s self-consciously hip minimalism and herd of Indie kid chill out haunts. The old house slotted between the cathedral and the Tjörnin city pond is full of charm and old-fashioned character – the name means ‘By the Lake’. Inside, the experience is somewhat akin to visiting your grandma’s house, in a  rambling  series of quaintly-cluttered small rooms,  where fringed lightshades hang low above the tables with embroidery samplers under protective glass; antiques and parquet floors combine to create a cosy low-lit ambience. Icelandic specialities are what’s on the menu – if you’re feeling brave, start, perhaps with the infamous putrified shark hákarl – and it comes served with pickled herring, ryebread, and more importantly, a shot of brennivin to clear your palate of its, erm, unique flavour. Sounding also a bit dubious are the house speciality – cods chins, but these turn out to be just fine. More orthodox choices might be honey-braised wolf fish with chilli, ginger and soya, or fried whole arctic char with lemon and dill butter sauce. Finish with traditional Skyr cake or home-made caramel ice cream. After a meal, diners are traditionally provided with a bag of ‘duck bread’ to feed the birds out on the pond.

Mains ISK 2200-6000

Einar Ben Veltusundi 1. Tel 00 354 511 5090; On the top floor of an old building looking over the central square by the tourism office, Einar Ben is an upmarket, traditional Icelandic restaurant. Its plush, old-school décor is a welcome antidote to the modish minimalism you find in so much of Rejkjavik, rather reminiscent of an antique shop with its patina of age in the dark oak floors and Regency-style burgundy and bottle-green walls. The place is named after a revered Icelandic poet and entrepreneur who designed the national flag and thought up a plan to run the nation on hydroelectric power and export electricity via undersea cables to Scotland. Rumour has it that he once did a deal to sell the Northern Lights! So, traditional, but there’s certainly nothing crusty in the relaxed, friendly service or up-to-date, inventive cooking. The kitchen raids Iceland’s natural larder for mountain lamb bred in the wild pastures where reindeer graze, as well as top-class fish and game, which gets skilled modern French treatment. Pan-fried pigeon with polenta, thyme and salsify is a typical starter, followed by fillet and shank of Icelandic lamb served with tarragon mustard and lamb jus. Fish turns up in the shape of cod fillet teamed with diced potato, onion lyonnaise and nutmeg foam. Save space for pudding, which might be dark and white chocolate mousse flavoured with mocha and whisky, served with Bailey’s ice cream.

Main courses ISK 3800 – 5500

Café Paris Austurstræti 14. Tel 00 354 551 1020; Café Paris is a real city centre Reykjavík institution – its terrace tables on Austurvöllur Square near to the lovely art deco Hotel Borg are the hangout of choice for many through the summer months. Whether you’re inside or out, it makes a great pitstop for brunch, lunch or a light dinner with a buzzy convivial vibe. If the weather forces you indoors, the interior is kitted out with a stylish retro chic – think black stone floors, high black leather banquettes and dark wood tables, and waiting staff in black flitting between the tables. There’s something to please everyone on a menu full of crowd pleasing dishes, covering all the bases from salads to sandwiches, pasta dishes or home-made soups.  You might fancy an open sandwich of smoked lamb with carrot and green bean salad (ISK 990), or a crêpe with Parma ham, feta cheese and sun-dried tomatoes (ISK 1890). Among main courses might be Icelandic lamb with rosemary, honey, haricot beans, tomatoes and Icelandic potatoes   (ISK 2890) or a more adventurous grilled Minke whale pepper steak with pan fried vegetables, bacon-potatoes and madagascar pepper sauce (ISK 2690)

Eldsmiđjan Bragagata 38A. Tel 00 354 562 3838; If the price of eating out in Reykjavík is killing your appetite, this easygoing little eatery among the residential backstreets near Hallgrímskirkja does wood-oven pizzas that don’t cost an arm and a leg. There should be something to tickle your fancy on a long menu listing about 30 pizzas. Old favourites such as Quattro Stagione, Margarita and Napoli are all present and correct, as well as more unusual offerings – how about a pizza with snails, cream cheese, green peppers, garlic, olives and mushrooms, for a change? All come in three sizes – a modest 10”, a sensible 12” and a table-sized 16” for sharing – or for the truly hungry. Count on spending around ISK 2500 per head for a medium pizza and a beer.

PRACTICAL INFORMATION FACTBOX

GETTING TO REYKYAVIK

Flights

Reykjavík’s international airport is actually in Keflavík, 49 kilometres – about a 45 minute ride – from the city’s central bus terminal, where you change onto feeder buses for individual hotels. Flight time from the UK to Keflavík is around 3 hours. Direct flights from the UK are operated by the following airlines:

British Airways flies from Gatwick

Icelandair flies from Heathrow, Manchester and Glasgow

Icelandexpress flies from Gatwick and Stansted

Tour operators

If you can’t be bothered to do all the donkey work for an independent trip, have a word with one of the following tour operators – there are plenty of off-the-peg trips, or you could fork out more and get them to tailor make a trip to cherry pick what’s most important for you. This list is not necessarily comprehensive, but it’s a good place to start.

Bales www.balesworldwide.com;  Cresta www.crestaholidays.co.uk; Cosmos Tourama www.cosmostourama.co.uk; Cox and Kings www.coxandkings.co.uk; Discover the World www.discover-the-world.co.uk; Gold Medal Holidays www.goldmedal.co.uk ; Icelandair Holidays www.icelandair.co.uk; Osprey Holidays www.osprey-holidays.co.uk; Regent Holidays www.regent-holidays.co.uk; Scantours www.scantours.co.uk; Solitair www.solitairhols.co.uk ; Taber Holidays www.taberhols.co.uk; Thomas Cook www.thomascook.com; Thomson www.thomson.co.uk; Travel 4 www.travel2.com; W A Shearings www.washearings.com; Yes Travel www.yes-travel.com

GETTING AROUND

As already mentioned, Reykjavík centre is a dinky place that’s a doddle to explore on foot. Some of the sights, though – the Laugardalur thermal baths and the Ásmundur Sveinsson Sculpture Museum, for example are a bit of a schlepp, so are best reached by bus, particularly if it’s cold enough to make a penguin shiver. The yellow buses criss-cross the city frequently, providing a great service – and hooray! they are free if you have a Reykjavík Weclome Card (see below). Call into the wonderfully helpful Tourist Information Centre at 2 Aðalstræti  for more information, maps and timetables.

Organised excursions cover all of the day trip sights I’ve mentioned around Reykjavik: call in to the Tourist Information Centre (or ask your hotel reception) for the latest details on the companies that run excursion programmes, including timetables and prices. As a rough guide expect to pay:

Golden Circle tour 15800ISK, Northern Lights 7000ISK,Blue Lagoon 6300 ISK,Volcano tour 9900 (Volcano sightseeing flight 45000ISK); Rejkjanes Peninsula 15000 ISK; Snæfellsness – glacier and National Park 22800ISK

If , like me, you don’t fancy the prospect of doing day trips in a herd of 50 strangers on organised excursions, then get a hire car and have an adventure. All of the sights I’ve talked about here can be visited without ever leaving tarmac roads, exception for certain parts of the Reykjanes Peninsula. It’s often perfectly feasible to travel on unsurfaced roads in a normal two-wheel drive car, but conditions of hire and insurance usually expressly forbid this. You may start off on a perfectly decent unpaved track, but then find it deteriorates and have to turn back – it’s easy to become stuck in sand and muddy stretches. I had a four-wheel drive vehicle  which made it easy to leave tarmac roads – it cost more but it was worth it.

Use the frequent airport shuttles to visit the Blue Lagoon the easy way, but you can’t beat hiring  car to explore the beautiful bleak wilderness of the Reykjanes Peninsula after you’ve finished simmering in the turquoise thermal pool.

QUICK FACT BOX

Language

Icelandic? Don’t even go there! This is a tonsil-torturing language that sounds lovely, but if you try to pronounce any of the words as they are written, locals will just look politely baffled. Anyway, almost all Icelanders speak embarassingly fluent colloquial English – in fact it is almost insulting to ask anyone if they speak English – it’s like asking whether they have been to school!

Time Difference

GMT operates all year, so when UK is on BST, Iceland is UK +1hr

International Dialling Code

00354

Exchange Rate

£1 = ISK196. You’re getting around 30% more kronur for your pound than in pre-crash times.

Everyday expenses

Glass of wine ISK950; beer ISK 650; coffee ISK 300; main course in restaurant ISK 3000 – 5000; 1-day Reykjavík Welcome Card ISK1500.

VAT refunds

One way to take the sting out of shopping in Iceland is to get your VAT back. To qualify, you have to spend over ISK 4000 on goods on the same receipt – not difficult – and then remember to get a refund of the VAT from either the Tourist Information Centre in Reykjavik centre or at the refund desk in the airport before you leave www.kefairport.is/English/Before-Departure/VAT-Refund/

When to go

When you choose to travel will always be a trade off between budget and weather. Summer (June-Aug) brings long daylight hours, mild weather and high hotel prices. Outside peak season prices fall along with the mercury – by October average temperature struggles to make it over 5 degrees. Winter is best for northern lights

Getting there

The international airport for Reykjavík is Keflavík, about 45 minutes by bus from the city centre. Flight time from the UK is around 3 hours.

British Airways flies from Gatwick; Icelandair flies from Heathrow, Manchester and Glasgow; Icelandexpress flies from GatwickStansted

Getting around

Central Reykjavík is best explored on foot. Organised excursions can take you anywhere mentioned in this guide – at a price – but hiring a car lets you do it at your own pace

Recommended Guidebooks

Footprint Reykjavík (ISBN 1 904777 66X)

Rough Guide to Iceland (ISBN 1-84353-289-1)

Tourist Office

Aðalstræti 2, 101 Reykjavík

Tel 354 590 1550

The official Tourist Information Centre in Reykjavík is incredibly useful and has heaps of handy leaflets and free maps of the city. They can also help with booking excursions, obtaining tax refunds on goods amounting to over ISK 4000, arranging car hire etc

Further Information

www.visitreykjavik.is

www.visiticeland.com

A footnote on whaling in Iceland

Not many people know it, but Iceland resumed commercial whaling in October 2006, after a 20-year hiatus.  25 nations, including Britain, registered their protests with Iceland’s government. For an outsider, you have to ask yourself – what was Iceland thinking when they took this decision? This is a nation that makes a lot of money from tourism, and the whaling issue will surely deter plenty of potential visitors who don’t want to support a hypocritical policy that takes your money for whale watching trips, while killing the unlucky ones who end up in the cross hairs of an explosive harpoon gun rather than a tourist boat’s crew of camera lenses.

Iceland’s whaling policy is difficult to reconcile with its otherwise strong environmental reputation. When I tried to talk about it with islanders, some thought it was a stupid decision, but this is a touchy subject involving national pride, but didn’t want to b. The more macho types are gung-ho about it ‘this is out heritage’ they say, ‘Icelanders are an island race – we have hunted whales for centuries’.  And it’s true: Iceland has never been scared to stick two fingers up to the world and go its own way. In 2009, Icelandic boats killed 125 fin whales and 81 minkes just to prove it can do what it likes

So, on one hand the tourist promotion spiel pushes whale watching trips – a nice little earner – but you won’t whaling mentioned on the tourist board website. When I was there, whaling boats moored by whale watching boats in the harbour certainly made for an infuriating sight. If you have strong feelings about whaling or simply want to find out more information on the subject, the following websites should help:

www.iwcoffice.org

www.wwf.org.uk

www.greenpeace.org

www.ifaw.org