Iceland: The New Budget Destination

A few years ago nobody could imagine that Iceland, the small island nation that sits between mainland Europe and Greenland, would ever be a budget travel destination. For years prices had been so prohibitively high that a backpacker could only experience Iceland in a cramped coach seat on its national airline. Times have changed.

What once made Iceland maddeningly expensive has now caused the country to go bankrupt. With low interest rates, the banks were wildly successful, popular with foreign investors and carried a large sum of international debt that they were increasingly unable to refinance. This, combined with the 2008 financial crisis, has effectively shut down Iceland’s economy and rapidly decreased the value of its currency. As of press time, 1 US dollar is now worth 117 ISK — up from 75 ISK in March. What’s more, Iceland Air is now cutting fares from the east coast of the US to Reykjavík.

If Iceland has ever interested you, now is the time to go. Not only to experience the wildly harsh geothermal terrain, endearing people and vibrant nightlife, but also to pump some much needed tourist dollars into its restaurants, hostels and bars.



GETTING THERE:

• Book directly from Iceland Air’s website and look for frequent web-only specials into Reykjavik. From now until March 2009, you can nail a flight for under $500 from the east coast of the US.

• Consider taking advantage of a free stopover that Iceland Air offers passengers traveling to continental Europe. Spend up to three days enjoying the tranquility of emptiness before continuing on to Frankfurt, Amsterdam, or any other city into which IA flies. This is a popular option for backpackers because it affords two destinations for the price of one.

• For even deeper savings, sign up for the Lucky Fares Newsletter to learn about last minute deals and subscriber-only rates.

In a city brimming with expensive hotels and guesthouses, The HI Reykjavik is a welcomed oasis. A bed in a dorm room will run you about $20 a night.


SOME THINGS TO DO:

• The Blue Lagoon: One of Iceland’s most famous attractions, the Blue Lagoon is a giant geothermal spa with milky blue water on a bed of white mud. This man made lake averages about 104 F.

• Geysir: Rent a car and drive out to the oldest known geyser in the world that is simply named, “Geyser.” While you’re there, wander through the rest of the park with its dazzling array of hot springs.

• Go Swimming: Swimming is very important to Icelanders, and this is evident in the numerous public pools that dot the country. Not only is it cheap, but it’s a great way to spend an afternoon while getting to know the locals.