Set on Flatey Island in the Breidafjördur Bay, this hotel is a 5-minute walk from the Baldur Ferry Terminal that departs from Stykkishólmur. It offers an on-site restaurant, bar and large furnished terrace. Wooden floors and furnishings are provided in Hotel Flatey’s rooms. All have shared bathroom facilities. Some have a French balcony with ocean views. Freshly baked bread, homemade jam and eggs from local birds are served on the breakfast buffet. Flatey Hotel’s à la carte dinner menu specializes in Icelandic seafood dishes. Village and ocean views can be enjoyed from the restaurant. Bird watching is a common area activity, as well as relaxing in the calm surroundings, which has several historic and restored, wooden buildings.