$177 Car Rental Downtown Reykjavik

These Downtown Reykjavik insights are based on real traveler data from Expedia, aggregated using AI to help you plan your trip. Updated: August 26, 2026.

Reasons to book a car rental in and around Downtown Reykjavik

Renting a car in Downtown Reykjavik offers freedom and flexibility for your travel plans. It allows you to explore the area at your own pace, whether you're visiting cultural landmarks like Hallgrimskirkja and Reykjavík Cathedral or enjoying the vibrant shopping scene on Laugavegur. The convenience of managing your luggage is a significant advantage, especially for families or those traveling with outdoor gear. With a rental car, you can easily venture to nearby neighborhoods such as Norðurmýri and Holt, both less than 1 mile away, where you can find additional attractions like the National Museum of Iceland. This flexibility is particularly appealing for eco-conscious travelers who want to explore the breathtaking landscapes surrounding Reykjavik. By having your own vehicle, you can easily plan day trips or spontaneous outings without relying on public transportation. Whether you are a family seeking adventure or a solo traveler looking to immerse yourself in the local culture, renting a car in Downtown Reykjavik enhances your experience and allows you to create lasting memories on your trip.

Most popular car rentals in Downtown Reykjavik

• Midsize SUV AWD: This popular choice accommodates up to 5 travelers and offers space for up to 3 large suitcases, making it ideal for families, couples, or small groups. The all-wheel drive enhances stability and control, which is particularly beneficial for exploring the scenic routes around Downtown Reykjavik. Enjoy the flexibility and comfort that this vehicle provides as you navigate the city and its surrounding attractions.
• Compact: A versatile option for up to 5 travelers, the compact car allows for up to 3 medium suitcases. This type is perfect for solo travelers, couples, or families looking to explore Downtown Reykjavik efficiently. Its smaller size makes parking easier in the bustling city streets while still providing comfort and convenience for your journey.
• Economy SUV: Ideal for budget-conscious travelers, families, couples, and adventure seekers, the economy SUV accommodates up to 5 travelers with space for up to 3 large suitcases. This option balances affordability with the ability to explore various terrains comfortably, ensuring you can enjoy both the city and the natural beauty surrounding Downtown Reykjavik without breaking the bank.

Top rated car suppliers in Downtown Reykjavik

• Enterprise: With a rental location conveniently situated in Downtown Reykjavik, Enterprise is a top choice for travelers seeking flexibility and convenience. Known for its commitment to customer satisfaction, this supplier offers popular vehicle options including Midsize SUV AWD and Economy models. Renting from Enterprise allows you to explore the stunning attractions of Reykjavik and beyond at your own pace.
• Alamo Rent A Car: Alamo Rent A Car features a rental location within Downtown Reykjavik, making it accessible for tourists. This supplier is favored for its variety of vehicles, including Midsize SUV AWD and Economy SUV options, which are perfect for navigating the scenic Icelandic landscapes. Alamo is dedicated to providing a hassle-free rental experience, ensuring you have the freedom to create your own adventure.
• Avis: Avis offers a convenient rental location in Downtown Reykjavik, catering to travelers who value ease of access. Known for its reliable service, Avis provides a selection of vehicles including Midsize SUV AWD and Economy models, ideal for your Icelandic journey. With Avis, you can enjoy the flexibility to explore Reykjavik’s attractions and surrounding areas comfortably.

Where to stay around Downtown Reykjavik

• Holt: Located less than 1 mile from Downtown Reykjavik, Holt is a charming neighborhood that offers an outdoor, family-friendly atmosphere. Visitors can explore local landmarks such as Laugavegur, a vibrant street perfect for city vacations, and Hallgrimskirkja, a stunning church that showcases the cultural heritage of the area. Additionally, Holt provides access to nearby spas and shopping areas, making it an ideal spot for relaxation and leisure. Restaurants in the vicinity offer delightful dining options for travelers.
• Vesturbær: Also situated less than 1 mile from Downtown Reykjavik, Vesturbær is known for its eco-friendly and outdoor experiences. This neighborhood features attractions like Reykjavik Harbour, which is perfect for enjoying beach scenery, and the National Museum of Iceland, a must-visit for culture enthusiasts. The area is also home to parks and dock ports, providing plenty of opportunities for exploration. With various dining options, including restaurants and bars, Vesturbær is a great choice for travelers seeking a balance of activity and relaxation.

10 tips to save on your car rental in and around Downtown Reykjavik

1. Use filters to find the right car: Refine your search by vehicle type and features. Whether you're looking for an SUV for added space, a convertible for summer driving, or an economical car for budget-friendliness, utilize filters on Expedia to discover the best options for your journey.
2. Book in advance to help lower costs: Rental rates can vary based on demand, so it's advisable to reserve your vehicle well ahead of your trip. Booking early often secures better rates and improves availability, particularly during peak seasons.
3. Consider a smaller car for savings: Compact cars are typically less expensive to rent and easier to maneuver in crowded areas. Mid-size vehicles offer a nice balance of cost, comfort, and fuel efficiency.
4. Age guidelines: Drivers under 30 may encounter higher deposits or daily fees, and certain vehicle categories—like SUVs or luxury models—might not be accessible. This can also apply to renters over 70. Always verify the age requirements prior to booking.
5. Check fuel policies: Some rentals operate under a full-to-full fuel policy, meaning you must return the car with a full tank to avoid additional charges. This is generally the most favorable option. Other rentals may provide full-to-empty or prepaid fueling alternatives, which are acceptable as well; just ensure you return the car empty in that case.
6. Save on city and airport pickups: Picking up your rental car at airports often incurs a surcharge, but the convenience may justify the extra cost.
7. Know your payment options: Most car rental companies exclusively accept credit cards for payment.
8. Understand your insurance coverage: Car rental insurance can help you avoid unexpected expenses and provides peace of mind in case something unforeseen occurs during your trip. Adding car rental insurance when booking with Expedia is a straightforward process.
9. Consider unlimited mileage: If you plan on taking long road trips, seek out rentals that offer unlimited mileage to prevent additional charges.
10. Bring your driver's license and ID: A valid driver's license is necessary to rent a car.

Best time to rent a car in and around Downtown Reykjavik

The best value period to rent a car in and around Downtown Reykjavik is December, when prices are lower and demand is moderately low. January and February also present good opportunities, as they tend to have quiet demand and slightly lower prices. Moving into the summer months, June through August see higher prices and increased demand, with August being the busiest and most expensive month for rentals. September and October return to average demand and pricing levels.

Calendar Month	Temperature	Precipitation	Cloudiness	Demand	Pricing
January	31.6°F (-0.2°C)	Light Rain	Mostly Cloudy	Moderately Low	Average
February	32.5°F (0.3°C)	Light Rain	Mostly Cloudy	Moderately Low	Slightly Low
March	33.4°F (0.8°C)	Light Rain	Mostly Cloudy	Average	Average
April	38.5°F (3.6°C)	Light Rain	Mostly Cloudy	Average	Average
May	43.9°F (6.6°C)	Light Rain	Mostly Cloudy	Average	Average
June	49.8°F (9.9°C)	Light Rain	Mostly Cloudy	Average	Slightly High
July	52.9°F (11.6°C)	Light Rain	Mostly Cloudy	Moderately High	Slightly High
August	51.8°F (11.0°C)	Light Rain	Mostly Cloudy	Moderately High	Slightly High
September	47.1°F (8.4°C)	Light Rain	Mostly Cloudy	Moderately High	Average
October	40.8°F (4.9°C)	Light Rain	Mostly Cloudy	Average	Average
November	36.0°F (2.2°C)	Light Rain	Mostly Cloudy	Average	Slightly Low
December	30.7°F (-0.7°C)	Light Rain	Mostly Cloudy	Moderately Low	Slightly Low