10 Budget-Friendly Food Options In Iceland

Iceland has a reputation for being expensive, but if you plan ahead of time it doesn’t have to be. Here are just a few places where you can stretch your dollar when you find your stomach growling after a long day of exploring.

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Fast Food

Some of you will cringe at the idea of me suggesting fast food as an option in another country, but I have no shame! When you’re trying to pinch a few pennies, sometimes a quick bite to eat at a familiar place is what we need to be able to spend our money on something else (like snowmobiling across a glacier!). Some budget fast food options in Iceland include but are not limited to Subway, Dominos, KFC, or if you want to try a local fast food chain, Aktu Taktu. For those of you cringing, don’t worry… the rest of these cheap eats are for you.

Icelandic Street Food

This is one of Reyjkavik’s most well-known stops around town for food. They have great food and even better service. They were super helpful and just all around happy for us to be there. They serve a bread bowl of lamb soup or shellfish soup for 1.990ISK or just in bowl for 1.490ISK. Their Fisherman’s Favorite which is very popular is only 2.000ISK. They also put out free small cake squares which were delicious. The best part though is the free refills! Their house rule tells it all, “No one leaves hungry in grandma’s house.” They also let you switch what you’re eating when you refill, so you can try more than one of their delicious dishes. The only down side is that Icelandic Street Food is a small place and hard to find seating, but they let you take your food two doors down to the Icelandic Craft Bar where they have a great selection of craft beers and plenty of room to sit. Then just wander back when you need your refills! If you’re in a giving mood after all the great food they serve, all their tips go to charity! How great is this place, really! What’s even better is they are expanding to the US! They will be opening up in Portland, Maine. So exciting!

Located at Lækjargata 8, 101 Reykjavík

Bæjarins Beztu Pylsur

This is the most famous hot dog stand of Reyjkavik. Many famous people have made their way to this tiny stand, including the US President Bill Clinton. Even with all the fame, they’ve kept their prices fair. A hotdog and soda combo will only set you back 700ISK. Their tasty hotdogs include a mix of beef, pork, and lamb, and are often ordered with “The Works” which includes onions, ketchup, sweet brown mustard called pylsusinnep, and a sweet mayonnaise. It’s a great late night meal before the bars, or even after as they are open late. We went later in the evening around 9pm and were lucky enough to walk right up. However, during the day you should expect a line so plan accordingly! They also have limited seating, so expect to eat your hot dog on the go!

Located at Tryggvatagata 1, 101 Reykjavík

Café Babalu

This café should be visited for nothing else but their unique vision on interior design. They have eclectic décor, reading nooks, and even Star Wars themed bathrooms. Not to mention their affordable menu, with Paninis only running 1180-1280ISK, and their tomato soup is only 990ISK. They also have a wide selection of other foods and beverages including crepes, coffee, beer, wine, vegan carrot cake, vegetarian, vegan, and gluten free options.

Located at Skólavörðustígur 22, 101 Reykjavík

Hlemmur Mathöll

This food hall has 10 different options for locals and tourists alike. They serve everything from traditional Icelandic food, to pizza, to Vietnamese street food. Top off your meal with a dessert or beverage from Micro Roast Te & Kaffi. If you’re trying to please picky eaters try the taco shop, Fuego… everyone loves tacos, right? This place has a range of food, and affordable options so you can stay within your budget for the day!

Located at Laugavegur 107, 105 Reykjavík

Noodle Station

This Noodle Restaurant has become a popular stop in Reykjavik, and it’s no surprise since they have the most delicious soup in town. It’s family owned by a native of Thailand and their family recipe is what keeps everyone coming back for more. They serve 3 different types of soup – chicken, beef, and vegetable – and it will only cost you 1640ISK for one of the meat soups, 960ISK for the vegetable soup.

Locatd at Laugavegur 103, 101 Reykjavík

Devito’s Pizza

Who doesn’t like pizza?! No matter what country we find ourselves in, my husband and I always end up getting a pizza there. I guess it’s our “thing” now. This pizza place has 10-inch pizzas starting at 1500ISK. They have ton of specialty pizza options as well as a multitude of toppings for a DIY creation. To save even more money, stop in for their lunch special from 10:30-2:00.

Located at Laugavegur 126, 105 Reykjavík

Hlöllabátar

A popular spot for a bite to eat after a long night of drinking, this place is known for its sandwiches and burgers to go. A 6-inch sandwich will only set you back 990ISK or go for a burger around 1300ISK. They also have salads and wraps for great prices.

Located at Ingólfstorg, 101 Reykjavík

Café Haiti

This little café has a vast menu with great budget options like their sandwiches from 550-1300ISK, or full breakfasts (choices with eggs, potatoes, pancakes, coffee, etc) from 1790-2500ISK. But, as the name implies, don’t forget to try their coffee from all over the world, including Haiti, Turkey, and Iceland of course. Or if you’re having a rough morning nursing a hangover, try a little “hair of the dog” with their “Coffees with Liquor” menu.

Located at Geirsgata 5C, 101 Reykjavík

Stock Up At A Local Grocery Store

If you really want to pinch those pennies and avoid eating out like you do at home, Iceland has great budget grocery stores and they’re all over. Iceland’s two major grocery store chains are Bónus & Krónan. If you see a pink pig or a smiling yellow O, you’ve found them! Book your stay at a hostel or in a home with a kitchen and cook your own traditional meals. Also, stock up on sandwich supplies because if you’re taking one of Iceland’s all-day tours, you may want to pack a sandwich before you leave to avoid spending money at a gas station later.

I hope these budget-friendly options help you travel Iceland more affordably! Drop a comment below with any cheap eats in Iceland that you’ve discovered! Happy travels!