VarmahlÝ­ is on crossroads at the foot of Vatnsskar­ Pass, a commercial centre and an important traffic junction point. VarmahlÝ­ stands high on the western side of the valley. Good views of Hˇlmurinn, the fertile outwash plain of the HÚra­sv÷tn rivers and the high basalt mountains on the eastern side of the valley