Hotel Budir stands on the edge of Iceland's Snaefell Peninsula, seemingly bracing itself against the elements. The wild Atlantic is on one side, a brooding mountain range on the other, and a sweeping plain of volcanic rubble all around. The ground is littered with huge slabs of jagged black lava and pockmarked with craters. The twin-gabled farmhouse is bleached white. The sky, the palest blue, seems endless.

Add to the mix a strange, otherworldly, palette: the ocean is turquoise, the land black, the tussocks of springy grass a pale gold. The only other building is a tiny, black, 19th-century wooden church, hunkered into the empty expanse, where guests can get married. From above, the pitiable cry of gulls cuts through the silence. A seal bobs in the estuary.

This is real 4x4 country: wildly romantic or desperately lonely. On the other side of the mountain range - as we discovered after missing the turn-off for the hotel in our standard saloon - there are a couple of rangy settlements. But here there is nothing. And it's breathtaking. We had bumped and skidded around the entire peninsula along potholed dirt tracks. The sense of relief, when we finally arrived, at dusk, was profound.

The hotel burned down and was rebuilt in 2001, so is relatively new, but the decor is tasteful and timeless: polished wooden floors, muted tones, lots of little alcoves with old leather and velvet sofas, antique prints, shelves and shelves of books, vases of fresh flowers.

The dining-room walls are painted lichen-green, offset by cream blinds, white tablecloths, wooden chairs and white banquet-seating down one side of the room. From the windows you can see the Snaefell glacier. The four-course dinner was delicious - think salted cod slivers, trout roe and carrot sorbet, and orange balsamic drizzle.

The breakfast spread of herring, salmon, cheeses, meats, rye bread, eggs, fruit, cereals and hefty loaves of bread for toast, and coffee in a flask, seemed designed to fuel long walks along the coast, horse-rides along the sand, or, in our case, snowmobiling on the glacier - which was even more exciting than negotiating the sheer mountain switchbacks in an unsuitable car.

LOCATION

Hotel Budir, 356 Snaefellsbae, Iceland (00 354 435 6700; www.budir.is) is in a protected nature reserve on the Snaefell Peninsula.

Time from international airport: It's a three-hour drive north from Keflavik.

COMFORTABLE

Choose your room carefully. There are 28 rooms and suites, but the standard rooms with a bath are all down one side of the hotel - and have views of the car park; those on the other side, with shower only, look out over the estuary to the snow-capped mountains beyond. Loft rooms have skylights but views over the church to the sea. Room 17 has a bath with a sea view while the honeymoon suite has a glacier view.

All the rooms are stylishly designed with wooden or seagrass flooring.

Freebies: basic toiletries.

Keeping in touch: phones.

THE BOTTOM LINE

Loft doubles from ISK18,300 (£141) including breakfast.

I'm not paying that: Snjofell guesthouse in Arnastapi (00 354 435 6783; www.snjofell.is) has doubles for ISK6350 (£49).

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