One of the complaints one hears most often from foreign visitors is that hotels in Iceland are expensive. Iceland is certainly not a cheap travel destination. In fact, Iceland is one of the most expensive places in the world to live. The fifth most expensive, according to the Telegraph.
While there are a number of reasons for why Iceland is so expensive as a tourist destination, including the strong Króna, the primary reason for the high cost of hotels is the simple fact that Iceland is facing a hotel shortage. Reykjavík hotels are frequently booked to capacity, leaving hotel operators with very little incentive to lower prices to fill vacant rooms!
Read more: Nearly all hotels and Airbnbs in Reykjavík booked for New Year's eve
The local news site Túristi checked the availability at Reykjavík hotels over the last weekend of this month, from Thursday until Sunday February 22-25, finding that only a handful of rooms were available. Reykjavík hotels which are listed on international booking sites like Booking.com are booked to 93% of capacity over the coming weekend. Túristi notes that this is a slight drop over last year when Reykjavík hotels were booked to 96% of capacity.
Compared to other major tourist destinations Reykjavík looks like it is sold out. Only 77% of hotel rooms in London are booked over the coming weekend.
As the law of supply and demand teaches us that the price will settle at a point where the quantity demanded will equal the quantity supplied. The rapid expansion of tourism in Iceland in recent years is simply straining infrastructure like hotels, leading to a dramatic increase in the number of new hotels and Airbnbs. And high prices for hotel stays!
One of the complaints one hears most often from foreign visitors is that hotels in Iceland are expensive. Iceland is certainly not a cheap travel destination. In fact, Iceland is one of the most expensive places in the world to live. The fifth most expensive, according to the Telegraph.
While there are a number of reasons for why Iceland is so expensive as a tourist destination, including the strong Króna, the primary reason for the high cost of hotels is the simple fact that Iceland is facing a hotel shortage. Reykjavík hotels are frequently booked to capacity, leaving hotel operators with very little incentive to lower prices to fill vacant rooms!
Read more: Nearly all hotels and Airbnbs in Reykjavík booked for New Year's eve
The local news site Túristi checked the availability at Reykjavík hotels over the last weekend of this month, from Thursday until Sunday February 22-25, finding that only a handful of rooms were available. Reykjavík hotels which are listed on international booking sites like Booking.com are booked to 93% of capacity over the coming weekend. Túristi notes that this is a slight drop over last year when Reykjavík hotels were booked to 96% of capacity.
Compared to other major tourist destinations Reykjavík looks like it is sold out. Only 77% of hotel rooms in London are booked over the coming weekend.
As the law of supply and demand teaches us that the price will settle at a point where the quantity demanded will equal the quantity supplied. The rapid expansion of tourism in Iceland in recent years is simply straining infrastructure like hotels, leading to a dramatic increase in the number of new hotels and Airbnbs. And high prices for hotel stays!
