Iceland is one of the most expensive places when it comes to accommodation and food. A simple hotel can cost, on average, 150 Euros per night without breakfast and often the quality is not the best. Obviously there are other solutions including the beloved farms with a few rooms available where you spend slightly less than the hotel and you're in close contact with the most unspoiled nature. Hostels and apartments are among the other available solutions, especially in high season, with a lot beforehand. I always recommend reservations through Booking.com because they very often guarantee full refund in case of cancellation (except in specific cases), interest rates and different solutions: hotels, hostels, apartments and even farms. In Reykjavik I recommend staying at the Icelandair Hotel Marina that also has an excellent restaurant and it is located near the center, very close to all the attractions. Small but well-organized, in true northern style.