There doesn't seem to be a huge amout of choice in hotels in that part of iceland but we found it a great place to stop a couple of days between the golden cirle and lundamanaugar.
Nice rooms, friendly staff, good breakfast and good food in the evening.
Recommend the walk around the mountain and up the lake just south of fludir (about 3 hours) and the secret lagoon, 15m walk from the hotel with small geysers and a large hot spring.
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