A stylish and social hostel in the heart of Laugavegur with a rooftop bar that's one of the best in the city. The bright, design-forward dorms and private rooms, excellent common areas, and prime location make Loft one of Europe's best city hostels.
Loft Hostel occupies a prime position on Bankastræti, one of Reykjavik's most central streets connecting the Laugavegur shopping corridor to Austurvöllur square. The hostel's location at the heart of the city's dining, nightlife, and shopping district gives it an immediate advantage over most of Reykjavik's budget options in the Capital Region. The property spans several upper floors of a commercial building, with a rooftop terrace — the hostel's defining feature — delivering sweeping views over the Reykjavik roofscape, Esja mountain, and Faxaflói Bay.
Accommodation is divided into dormitory rooms and private rooms, both designed with a clean, modern aesthetic that avoids the institutional feel common in budget hostels. Bunk beds in the dorms are sturdy and well-spaced; private rooms are compact but thoughtfully arranged. Shared facilities are generous and well-maintained, including a fully equipped communal kitchen, spacious lounge areas, laundry machines, and a tour booking desk staffed daily.
The rooftop bar is the hostel's social centerpiece and one of Reykjavik's most enjoyable outdoor venues on warm evenings. It serves beers, cocktails, and light snacks, and fills quickly during summer when the city basks in near-continuous daylight. During winter, the rooftop occasionally stays open for guests hoping to spot the aurora borealis on clear nights. The in-house tour desk arranges day trips to the Golden Circle, South Coast glaciers, and the Snæfellsnes Peninsula.
Loft is consistently ranked among Iceland's top hostels and regularly cited on lists of Europe's best budget accommodation, making it a frequent first choice for solo travelers and backpackers exploring Reykjavik and the broader Capital Region.
Amenities
- bar
- rooftop terrace
- wifi
- common kitchen
- lounge
- tour booking
- laundry
Location
Bankastræti 7, 101 Reykjavik
64.1459, -21.9302 View on map
Highlights
- Rooftop bar with panoramic views of Reykjavik, Esja mountain, and Faxaflói Bay — one of the city's best elevated venues
- Prime location on Bankastræti, steps from Laugavegur and Austurvöllur at the heart of Reykjavik
- Clean, design-forward dorms and private rooms maintained to an unusually high standard for budget accommodation
- Fully equipped communal kitchen — a significant cost-saving resource given Iceland's high food prices
- In-house tour desk booking Golden Circle, South Coast glacier, and Snæfellsnes Peninsula day trips
Tips for visiting
- Arrive at the rooftop bar early on summer evenings — the midnight sun views are exceptional, but seating fills by mid-evening.
- Pick up groceries from the nearby Bónus or Krónan supermarket and use the communal kitchen; even one home-cooked meal per day significantly cuts costs in Iceland.
- Private rooms book out weeks ahead for June–August travel; dormitory beds are easier to secure but still warrant advance reservation.
- The central Bankastræti location places the hostel close to Reykjavik's late-night venues — bring earplugs if an early start is planned.
- The tour desk can occasionally secure last-minute day-tour spots when online providers show sold out.
Accessibility
Loft Hostel is in a multi-floor commercial building with lift access. Some areas, including parts of the rooftop terrace, may present challenges for guests with limited mobility. Guests with specific accessibility requirements should contact the hostel directly before arrival to confirm suitability.
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Frequently asked questions
What room types does Loft Hostel offer?
Loft offers mixed dormitory rooms, female-only dormitory rooms, and private en-suite rooms. All share access to the communal kitchen, lounge areas, and rooftop bar.
Is the rooftop bar open to non-guests?
Yes. The rooftop bar is open to the public and is one of Reykjavik's popular spots during summer evenings. Non-guests are welcome during bar opening hours.
How central is Loft Hostel?
Loft is on Bankastræti in 101 Reykjavik, a 1-minute walk from Laugavegur and about 5 minutes from Austurvöllur. It is one of the most centrally located hostels in Iceland.
Is there a curfew at Loft Hostel?
Loft operates as a 24-hour establishment with no curfew. The bar and social spaces close in accordance with Reykjavik's licensing regulations.