Google may be an imperfect oracle, but before I took the plunge and bought a trip to Iceland on the grounds that it is newly cheap, I sought some numerical backing. With the country's economy collapsing due it its heavy reliance on the banking sector, surely things for the cash-strapped tourist must have changed for the better in the capital?
Tap in "Budget Holiday Reykjavik" and you get 20,000 results. "Expensive Holiday Reykjavik" produced fewer than half as many. It seemed the ideal destination for a Brit burdened by sterling. I clicked to book.
Many aspects of a trip to Iceland are inherently pleasing. For a start, flight times are civilised and there is no time difference between the UK and Iceland. So I arrived at my hotel in a stress-free condition, in the early evening.
The Hotel Cabin is a budget option but the ground floor area looked attractive, so I unpacked and went to the bar. Just in time I spotted a price list, thoughtfully placed on the counter in front of me. How much? Mmm – maybe later. £7 is a bit steep for a small glass of house wine: I hadn't expected to open the duty-free quite so soon.
Suitably fortified, I set out in search of dinner and a first look at the city. Since last weekend, the spring equinox, Reykjavik enjoys more daylight than any other capital in the world. It is a small city, too, so it's easy to tackle even after a flight from London or Glasgow.
Although I was staying outside the central 101 district, I was only 10 minutes from the start of the main street, Laugavegur. I'd already decided to check out Laekjarbrekka, a restaurant recommended by locals and guidebooks alike for its Icelandic specialities: reindeer, mountain lamb and lobster tails are regularly on the menu. The single-storey building at the bottom of the street looked welcoming; it was the menu outside that gave me a bit of a shiver. I could get lamb and lobster in a single course – but only if I was prepared to pay more than £37 for the privilege.
Maybe fish and chips instead, then? After all, Iceland is famous for its fishing industry. I set off towards the harbour and a newish organic bistro, Icelandic Fish and Chips. This was more like it: haddock so fresh it must have been caught that morning, and at a price you couldn't beat back home (£11.30 for two courses). And it's not essential to spend on drinks: everywhere in Iceland, local spring water is provided free of charge. But as I headed back to my hotel, I noticed that the bars were filling up.
This must be the runtur, roughly translated as a pub crawl, which takes place every Friday and Saturday night, between midnight and five in the morning, through the bars of the city centre. How on earth do they afford it? There's supposed to be a credit crunch here too.
The streets were quieter on Saturday morning when I set out to explore, and those locals who were up and about were ensconced in the many coffee shops dotted about the city. £1.30 a cup with a free refill? Now this was more my style – and the Wi-Fi was free, too. I planned a route through the city: I would explore the central square, Austurvollur, where the cathedral and parliament are located, see what was happening at the harbour, linger in a gallery or two. But first, energised by the low-cost caffeine, I headed to the tourist office to see what bargains they might offer.
Was it possible to see Reykjavik on £10 a day? It was possible, apparently. "If you buy this Welcome Card [which costs approximately £8], everything will be free," I was told. "The museums, all the thermal baths, the buses, everything."
I paid up and set off to find out about Iceland's origins at the Saga Museum, an interactive historical display housed in a striking glass-domed building called the Perlan.
I presented my card at the desk. "I think this will get me in for nothing," I said. "I'm afraid not. We are the one museum that is excluded from the scheme," came the reply. I bought a ticket anyway, even though it cost £8.50, slightly more than the 24-hour Reykjavik card. Inside, I learned about the early Viking settlers who arrived in the 8th century; discovered that Reykjavik means "smoky bay" (a reference to the steam rising from all the underground hot springs); and found out about the Alping, or parliament, which is thought to be the oldest in the world.
If the Saga Museum is Iceland's flashiest attraction, the Hallgrimskirkja is its most prominent. Located on the city's highest hill, Reykjavik's main church was designed in the 1930s, and the upward sweep of the exterior is intended as a reminder of the Icelandic mountains. Out of 20th-century expedience, the building had to double up as a radio mast, hence the vast tower which is visible from all over the city (and which is currently shrouded in scaffolding).
Across the street from the church is the Einar Jonsson Museum, where there is a collection of monumental works that I was keen to see by Iceland's first sculptor, as well as the apartment he had lived in with his wife. I approached the desk, handed over my card and smiled; "I think this will get me in for nothing." "Oh no it won't," came the reply. I was beginning to understand how it must have felt to discover your life savings were invested in an Icelandic bank.
For most visitors, a trip to Iceland is more about the unique scenery than the urban attractions. Handily, the day-trip industry is extensive and well organised. At this time of year there are glacier walks, trips along the south coast with its small villages and black sand. The "if-you-make-only-one-tour" option is the Golden Circle trip: the landscape includes waterfalls, geysers and lava fields, studded with volcanic craters that resemble barnacles on a rock.
This curious terrain reflects the fact that Reykjavik is capital of a country with an improbable number of natural hot springs. The heat from the centre of the earth is one of Iceland's greatest assets. It's put to use, among other things, to keep the roads free of ice, heat the domestic water supply, and facilitate the nation's favourite pastime: outdoor swimming.
The nearest thermal baths were five minutes' walk from my hotel. With some trepidation, I showed my Welcome Card. "Great – you can get in for nothing," said the cashier. But I had failed to bring a towel, so the excursion cost me £2.50.
Some people swim at the baths, but most sit in the hot pots: tubs of water that are heated to varying temperatures. I stepped into a pot labelled 44 degrees, and as the steam rose around us I got into conversation with Aleksandra, a young woman who had lived in Reykjavik all her life. We talked about the runtur, that weekend pub crawl that appeared ludicrously expensive to me. To Aleksandra, too, it seemed.
"We stock up at the liquor stores and drink at each other's homes. We go to the bars later to see our other friends," she explained. "But then you have more drinks?" I enquired. "No of course not. We just go from bar to bar and meet up with everyone." The bar owners tolerate their premises acting as community centres. It seems that even with the economy on the edge of an abyss, some people are prepared to drink, and therefore bankroll the whole operation in a country where the banks have rolled over.
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