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If you’re looking for a unique and relaxing place to stay just outside Reykjavik, Frost and Fire Boutique Hotel Iceland should be at the top of your list. Nestled in the geothermal town of Hveragerði, just 45 minutes from Reykjavik, this charming hotel offers cozy rooms, incredible dining, and dreamy outdoor hot tubs right along the Varma River. I spent one night here during my March 2025 trip, and it was hands down my favorite hotel of the whole adventure! Between the warm hospitality, scenic setting, and the chance to soak in a geothermal hot tub under the stars (and maybe even the northern lights!), this hotel truly offers something special.

Why I Loved Frost and Fire Boutique Hotel in Iceland

I spent one night here in March 2025, and it quickly became the highlight of our trip. The property was beautiful, the staff was incredibly welcoming, and everything—from the views to the food—was top-notch. My only regret? Not staying longer!

The hotel

Located in the geothermal town of Hveragerdi Iceland, Frost and Fire Boutique is the perfect base for exploring some of Iceland’s most famous sights. The hotel has just 22 rooms housed in cozy cottages spread across the riverside property. Each room features Icelandic design elements and stunning views of the surrounding nature.

At check-in, the staff warmly welcomed us and gave us a tour of the property, pointing out everything from the geothermal hot tubs to the restaurant. Everything was clean, quiet, and well maintained.

Our room

We stayed in a standard room, which came with a European double bed (2 twin beds pushed together). The room was bright, warm and surprisingly spacious-plenty of room for two people and their suitcases. It included two chairs, a table, a desk, and a roomy bathroom with excellent water pressure (a small detail that always wins me over)!

Room rates at Frost and Fire Boutique Hotel typically range from $150–$400 USD per night, depending on the season and room type. We stayed in March (a shoulder season), and our standard room fell right in the middle of that range. I definitely felt the room was worth the price!

Dining at Frost and Fire: Don’t Miss Varma Restaurant

Let’s talk about Varma, the on-site restaurant at Frost & Fire—and easily the best meal I had in Iceland!

Varma is located in a greenhouse-style dining room with panoramic views of the river. It focuses on farm-to-table dishes and geothermal cooking techniques, using naturally heated steam and earth to cook items like slow-cooked lamb and baked bread.

Here’s what we ordered:

• Drinks: I started with a spritz cocktail, which was light and refreshing.
• Appetizers: Reindeer carpaccio (my favorite!), Icelandic scallops, and lamb licorice. All were fantastic, but the reindeer was a surprising standout—tender, flavorful, and unique.
• Entrées: I had Arctic char in beet sauce, which was rich and flavorful. Joe ordered the geothermically cooked lamb shanks, and it was possibly the best lamb I’ve ever tasted.
• Dessert: We split the chocolate cake (cooked geothermally!) and the crème brûlée. Both were amazing, but the homemade ice cream they came with was next-level good.

Breakfast the next morning was included and equally impressive. Highlights included:

• A waffle station
• Fresh eggs and bacon
• Smoked salmon and cured meats
• Yogurt toppings and fresh bread

We enjoyed breakfast while taking in the river views—such a peaceful way to start the day.

Soaking in geothermal hot tubs at Frost and Fire

After dinner, we headed straight for the outdoor hot tubs, which are located right along the banks of the Varma River. These natural tubs are heated to 102–104°F with geothermal water and are open until midnight—perfect for relaxing under the stars. While we didn’t catch the Northern Lights that night due to cloud cover, the experience was magical nonetheless.

Other geothermal amenities include:

• A heated swimming pool (under maintenance during our visit)
• A riverside sauna

I highly recommend staying at least two nights so you can fully enjoy these features.

What to Pack for Your Stay at Frost and Fire Boutique Hotel

Because the hotel is located in a geothermal town and the hot tubs are outdoors, I definitely recommend packing a swimsuit and a pair of easy-to-slip-on sandals or flip flops for walking to and from the hot tubs. A warm robe or towel poncho could be helpful if you’re visiting during the colder months (like we did in March), especially when heading back inside after a soak. And don’t forget a hat and gloves—you’ll be surprised how chilly the air can be, even when you’re in the hot water!

Check out my complete packing guide for What to Pack for Iceland in March for more information!

Final thoughts: Is Frost and Fire Hotel worth it?

If you’re heading to Iceland and want a peaceful, romantic, and authentic Icelandic hotel experience, Frost & Fire Boutique Hotel in Hveragerði is a must. It’s perfect for couples, solo travelers, or anyone looking to unwind in a quiet, nature-filled setting—not to mention it’s a great stop along the Golden Circle.

If Frost and Fire Boutique Hotel Iceland sounds like your dream stay, I’d love to help you book it! As a travel advisor, I can secure exclusive perks, upgrades, and the best rates—making your trip even more special. Let’s start planning—contact me here!

Have you stayed at Frost and Fire Hotel before? I’d love to hear about your experience in the comments! And if you found this review helpful, share it with a friend planning a trip to Iceland!