It might seem contradictory to travel somewhere known for its icy climate during the coldest months of the year – but arranging your trip to Iceland for late autumn or spring helps you miss the busy tourist season, and gives you the chance to see the famous Northern Lights.
And if you arrive before December 8 you can see Yoko Ono's annual Peace Tower in memory of John Lennon, a beam of light illuminating Videy island near capital Reykjavik. But year-round you can enjoy whale and puffin watching, the impressive geysers and waterfalls, centuries of Viking history and a unique spa experience at the Blue Lagoon.
Set on a peninsula, Reykjavik's Centerhotel Arnarhvoll is perfect for views out to the sea. You currently have to share the vista with construction work on the city's new Concert Hall, but that should be finished in 2011. And while it's away from the noisiest streets, it's only five to 10 minutes walk from the centre of town and the Old Harbour.
As with most Icelandic hotels, the minimalist chic rooms are compact, but the beds are comfy, the duvet is toasty warm, and there's a cunning foldaway shower in the bathroom, as well as an open plan wardrobe – think Ikea with an extra helping of style. There's a top-floor restaurant and basement spa, with steam room, as well.
Prices start from around £60, including breakfast. Spa entry is included for a deluxe room, or an extra £8.50, if you're staying in a standard room.
Heading to Iceland between October and March means you'll get one of the best chances to see the stunning Aurora Borealis, or Northern lights. Caused by solar winds colliding with the upper atmosphere, the most common are the swooping green waves, but you could be lucky enough to spot magenta or yellow.
Of course, the natural phenomenon isn't guaranteed, so it's a good idea to travel with a tour as their experts check the best locations, which change every day and are often well off the beaten track. Reykjavik Excursions runs evening tours, priced around £25, and if you get a light-free night, you can rebook for free until you have better luck. Do wrap up very warm, as you'll be standing outside in the dead of night for long periods!
Iceland's compact capital Reykjavik is easy to explore – but instead of wandering around on foot, the best way to see as much as possible is by bike. Reykjavik Bike Tours, run by Icelander Stefan and his wife Ursula, are easily the best way to get your bearings, see the sights and find out more about life in Iceland, all at the same time.
Starting in the Old Harbour, they provide the bikes and helmets (as well as extra layers, if they don't think you're wrapped up warm enough) before cycling around the streets for around two and a half hours. Among other stops, you'll get to see the Parliament – no heavy-handed security here – as well as the Cathedral, City Hall on stunning Tjörnin City Lake, some of the main squares, Bjork's house, and meet a few of the city's characters. The Classic Reykjavik tour costs £20, email bike@icelandbike.com or call/text +354 694 8956 to book.
Settled in around 871, the last country in Europe to get permanent inhabitants, Iceland also boasts the world's oldest democratic parliament, plus plenty of tempestuous episodes courtesy of its Viking population and geographically violent landscape. So even if you're the kind of person who wouldn't normally set foot inside a museum, make a couple of exceptions in Reykjavik.
The National Museum traces the country's history from its earliest days to the present, through a string of fascinating and well-preserved artefacts. Starting with a thousand-year-old statue, thought to be of Thor, there's also skeletons, jewellery and stunning carvings, among other exhibits. Entry costs around £5 and do pay the extra for the audioguide, around £1.50.
And Reykjavik 871 +/-2 is set inside a recently discovered Viking longhouse, thought to date back to the time of settlement. With a few holographic and interactive tricks, it's a fun way to see what life would have been like. Entry costs around £3.
Iceland has become more affordable to tourists after the economic crisis, but it's still not the cheapest country – and one place you'll notice it most is in restaurants. Unless you're happy to snack on hotdogs and pizza, it's common to splash out £20-£40 for a main course. But there are a few places to try the country's fabulous fish, seafood and lamb without taking out a second mortgage.
Sea Baron, or Saegreifinn as it's called in Icelandic, is famous for its lobster bisque - and its owner Kjartan, who only speaks a few phrases of English. That's all you'll need to order the soup, around £5.50, or mouthwatering fish, around £9.50, along with fresh bread. Also on the Old Harbour nearby, the Icelandic Fish and Chips restaurant serves exactly what it says on the door – with a few gourmet Icelandic twists. Choose from a string of different options, such as ling or wolf fish, your own choice of fried potatoes and skyr dips, a traditional Icelandic creamy yoghurt concoction. Fish costs from around £5.20, and side dishes start at around £2.50.
Or for something a bit fancier, Gata on Laugavegur, does fantastic watermelon martinis for around £10, plus tender lamb, lobster ravioli, and frozen berries with white chocolate sauce. Main courses cost around £17.
There's only three rules when it comes to the runtur, as Reykjavik's Friday and Saturday night bar crawl is known. Start at home, where the alcohol is slightly less expensive, dress up to the nines and head out around midnight, then go from bar to bar until around 5am – or until your wallet can't take the punishment any more. A glass of wine will set you back £5 or more, and beer is around £4.50.
Laugavegur is the main street to amble along – stop off at Bar Oliver and nearby Boston at number 28b. Or if you're in the mood for real glamour, whatever the cost, try the bar at 101 Hotel, and Kaffi Solon where it's best to arrive early and look gorgeous to avoid the queues.
Reykjavik has more souvenir shops than you can shake a horned Viking helmet at, but if you want a more unusual memento than a stuffed puffin, head to the Kolaportid flea market. It runs every Saturday and Sunday, between 11am and 5pm, in the Customs House building on Tryggvagata opposite the famous Baejarins Betzu hotdog stall (where Bill Clinton ordered one with mustard). The unmarked door is around half-way down on the side. Here you can stock up on dried fish or sample the unpalatable Icelandic delicacy fermented shark, as well as picking up jewellery for around £15, vintage clothes and even military uniforms.
Music lovers will be in heaven at music shop 12 Tonar where you can catch live music and listen to CDs over a cup of coffee – it closes early on Saturday and isn't open Sundays. Or there's great jewellery at Aurum on Bankastraeti. For the pick of Iceland's design, head to Kraum. Even if you're not buying, it's worth a wander to eye up the fish leather shoes, minimalist homewares and kitsch cod lamps, made from hollowed out fish – a steal at around £400 each...
No spa on earth comes close to the incomparable Blue Lagoon. Set in the shadow of a geothermal power station, you travel for around 40 minutes through tortured lava fields to reach the manmade lagoon – visible by the billowing clouds of steam from the road.
But the otherworldly landscape pales into insignificance once you relax in the naturally warm milky blue water, which keeps you beautifully toasty at 38C even when there's frost on the ground around you. There's different temperatures to choose from, with hotter water around the vents and bubbling centre, as well as a waterfall so powerful it pummels any stress out. Slap on the white silica mud for an al fresco face mask as well – you'll be pink and glowing all afternoon.
While the mineral-rich waters will do wonders for your skin, your hair won't appreciate it as much, so pack intensive conditioner or a swimming cap and remove all jewellery as the water can corrode the metal. Yes, it's touristy and can get busy in the summer, but it really is an unmissable experience. Entrance costs around £24.50 plus £4.50 for towel hire or £8 for robes.
The lagoon is between Reykjavik and Keflavik airport, so you can make it a stop off on arrival or departure. If you get the regular bus service with Reykjavik Excursions they'll store your bags for free. Bus-only tickets cost around £17, or £33 including entrance.
Although you're likely to base yourself in the capital Reykjavik – along with around two thirds of Iceland's population – one trip you shouldn't miss making is to the Golden Circle. Covering Thingvellir National Park, the waterfalls at Gulfoss and Geysir, home of the original geyser, it's a great taste of the incredible history and geology which have shaped the country.
Thingvellir, a Unesco World Heritage site, was the home of the first parliament in 930, and although there's not much archaeological evidence to see today, it's easy to imagine the impressive gathering. Set in a stunning wilderness on the deep lake Thingvallavatn, it's also within the rift valley between the North American and Eurasian tectonic plates – still moving further apart every year.
Then you can marvel at Gulfoss, a 32m high cascade which freezes in winter, as well as the powerful geysers at Geysir. The original, which gave the name to all the others, is currently quiet but Strokkur erupts every five minutes or so like clockwork. Watch for the bubble signalling the jet of water, and a second geyser immediately afterwards.
A day tour with Reykjavik Excursions costs around £51, excluding lunch.
UK citizens don't need a visa to visit Iceland for stays of up to three months.
Icelandair flies from Heathrow to Reykjavik, with prices starting from £190 return, including taxes. Their Northern Lights City Break deal includes return flights, three nights accommodation and a Northern Lights tour from £269.
Reykjavik Excursions organises tours to the Golden Circle for around £51 and Northern Lights for £25, as well as buses to the Blue Lagoon, £17, and the Flybus to and from Keflavik Airport, from £10 one-way or £13 to include hotel drop-off. All the tours will collect and drop you at most major Reykjavik hotels, including Centerhotel Arnarhvoll.
For more information on Reykjavik, visit the tourist office. The Reykjavik welcome card, which includes entrance to several museums, ferry to Videy Island and bus travel, costs from around £8 for 24 hours up to £13 for 72 hours.
For more information on Iceland, go to visiticeland.com