Hello,
I will be on a two day lay over in Reykajavik enroute to Sweden in June. Any suggestions on where to stay on a small budget?
We stayed here http://www.isafoldguesthouse.is/index.php
years ago and found it comfortable and in very easy walking distance to everything in Reykajavik. It was a great value at that time. The let us check in at 8am in the morning which was appreciated. Not only did they welcome us but they offered to feed us breakfast that morning. Nice touch!
I stayed at the Foss Hotel Barron. Good location, breakfast in the moring, and they will book tours for you. Just tell them what you want and they are great at finding you a tour company with any requirements. Cheaper to book on www.hotels.com I find.
Make sure you go to the Blue Lagoon, the milky blue, mineral-rich geothermal waters while you're there. The water is silky on your skin, deliciously hot, and it's the coolest place in Iceland. It's outdoors. We were there in March , enjoying the heat of the water when the air outside was cold. THen it started to snow! Talk about a magical moment! Iceland itself is wonderful too. Enjoy!
The Reykjavic city youth hostel is quite good, clean, quiet, and relatively inexpensive. They also can organize day tours for you & the busses all stop at the hostel.