In my opinion, Flateyri is one of the nicest towns in Iceland. This town was hit badly by an avalanche in 1995, killing 20 people. Now there is a giant "wall" protecting the town from avalanches. I recommend hiking the wall, it gives you great views but also helps you understand what happened here.

The town itself is small and has a very good vibe. I enjoyed walking around town, visiting the old bookshop, eating at Vagninn restaurant, learning about the fish in svarta pakkhúsið (black hut by the sea) and visiting the swimming pool

When walking around town, it's a fun game to spot all the painted birds on the houses.