The journey to Edinburgh itself explains why we are getting another hire car. Between the three of us it cost us £36.60 ( $77 AUD) to get from our house-sit in Melrose to Edinburgh airport by public transport - we can share a hire car between us for £13 ($27) a day! When you're traveling in a group, car hire is usually the best and cheapest way to get around, especially in top-tier, first-word countries like Britain, Ireland, and the USA, where public transport is usually expensive.
Iceland has a small population, most of which is in the capital Reykjavik; the rest of the people are spread out sparsely in a relatively large land. The result of this is that, while there is public transport, it’s minimal, and not a good way to get around, especially if your stay in Iceland is a relatively short one and you need to be flexible. A car is the only practical option for exploring Iceland outside of Reykjavik.