In this EPIC GUIDE, we cover where to stay in Faro based on your travel style & budget. Check out the coolest areas in Faro!
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When you think of heading off to Portugal you might be thinking of Lisbon and Lisbon only. We are here to let you in on a little secret, the mystical and magical Portuguese paradise: Faro! No matter how hard we tried, we just couldn’t work in an abracadabra…

Faro is the capital of the Algarve region in Southern Portugal and is quite the underrated city. There are no swarms of tourists taking up every good spot on the beach, nor crowding the interesting Faro sites like the Bone Chapel. Lisbon is incredible, we’re not hating on Lisbon. But there is something about Faro that just takes our breath away.

So let’s bring in the expert travel writers, who put together this guide to the best neighbourhoods to stay in Faro.

With our Faro neighborhood guide, you have all you need to make the best choice of where to stay in Faro given your budget and the vibes you’re seeking. #GoodVibesOnly — We know.

 

Quick Tips – Where to Stay in Faro

 

In a hurry? Here’s my top neighborhood for first timers:

 
Marina de Faro
If you’re curious as to where to stay in Faro for your first time our answer is definitely the Marina de Faro! It is the part of town is home to Faro’s Marina that faces the beautiful Ria Formosa.
 
Places to Visit:
  • Catch a free performance or music concerts outside during the summer months
  • Snap a photo of the “Heart Faro” sign on the boardwalk
  • Enjoy seafood at a waterside cafe like Marisqueira Faro e Benfica

 

Where to Stay in Faro

In a super big rush to find the perfect place to stay in Faro? Look no further. These are our highest recommendations for Faro accommodation.

 

Best Hostel in Faro: Casa d’Alagoa

Casa d’Alagoa is our top choice for hostels in Faro. It’s perfect location paired with its unparalleled hospitality makes it a Porteguese gem. We love the shared spaces that guests can use: a kitchen, dining room, and nice outdoor space. And this Faro hostel is built inside a historical building which adds a double wow factor!

Need to spend some quality time with fellow backpackers? Get your fix by staying at one of these amazing hostels in Faro!

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Best Airbnb in Faro: Luxury apartment with great value

With hotspots around every corner, this is definitely the right place you want to stay at when visiting Faro for the first time. If you’re unsure about what to do or see during the day, reach out to your host and she’ll provide you with great recommendations. The Airbnb is cosy and welcoming, with big windows and bright rooms – definitely a great home.

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Best Hotel in Faro: Faro Cosy Guest House

Faro Cosy Guest House is conveniently located in downtown Faro and was recently renovated. The rooms are very affordable, and the rooms live up to the hotel’s name: cosy indeed! Enjoy all that Faro has to offer from a clean, comfortable room that usually costs less than $50 a night. Awesome, right?

View on Booking.com

 

Faro Neighborhood Guide

 

Quick Summary: The Best Places to Stay in Faro

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Marina de Faro

  • If you’re curious as to where to stay in Faro for your first time our answer is definitely the Marina de Faro! It is the part of town is home to Faro’s Marina that faces the beautiful Ria Formosa.
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Cidade Velha

  • The Cidade Velha translates simply to Old Town in English. The Cidade Velha is the historical center of Faro. It is surrounded by 9th century walls from the Moorish occupation.
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Downtown Faro

  • Alright, are you wondering where to stay in Faro for nightlife or where to stay in Faro for one night? The answer is definitely Downtown Faro. Faro’s downtown is the most popular place for tourists to visit and stay in Faro.
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Ilha de Faro

  • Isn’t it wild that the ocean and the lagoon of Ria Formosa are only 10 meters apart from each other in some parts? Faro isn’t technically even a beach resort city, since there are actually no beaches within walking distances of the center of the city.
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Montenegro

  • Montenegro is the perfect place to stay with kids in Faro. Why is Montenegro recommended as where to stay in Faro with kids? Montenegro is a suburb of Faro that promises guests a more peaceful and restful stay in Faro.
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Faro is the capital of the famous Algarve region in southern Portugal. Is it weird that I wanted to call the Algarve region delicious? It has approximately 118,000 city dwellers, which makes it the biggest city in the Algarve. For those of us out there who have visited big cities like London or Prague, you might think 118,000 is not that big at all.

Sounds quaint and cozy in comparison, right? Well, this wonderful metropolitan city also has exquisite island beaches, and plenty of fun things to do and see. Let’s figure out which part of Faro is the best neighborhood to stay in for you!

 

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Check out this post to read our full review!

 

Faro’s 5 Best Neighborhoods to Stay in

Ready to rumble? Let’s dig into the best neighborhoods to stay in Faro!

 

#1 Marina de Faro – Where to Stay in Faro for the First Time

If you’re curious as to where to stay in Faro for your first time our answer is definitely the Marina de Faro! It is the part of town is home to Faro’s Marina that faces the beautiful Ria Formosa. Most hotels offer views of the fishermen boats below or those stunning summer yachts.

The Marina de Faro area is filled with lots of outdoor activities that you will love. In the summer, there are free performances and music concerts outside that make for a perfect evening.

Marina de Faro, Faro
Source: Ivor (Wikicommons)

Delicious seafood restaurants abound here, featuring the catch of the day! While the hotels here might be a bit of a splurge, Marina de Faro is the perfect place to stay in Faro for first timers.

 

Things to Do and See in Marina de Faro

– Catch a free performance or music concerts outside during the summer months

– Walk around the marina and take turns pointing out which boat is your dream boat

– Cruise along the waters on a boat tour and keep your eyes peeled for the abundant bird life

– Visit Faro’s Maritime Museum and see the curious exhibits about Portugal’s Age of Discovery

– Snap a photo of the “Heart Faro” sign on the boardwalk

– Enjoy seafood at a waterside cafe like Marisqueira Faro e Benfica

 

Best Hostel in Marina de Faro: Well’Come to Algarve! Hostel

Well’Come to Algarve! Hostel is located just a couple blocks right off the water on a charming street, inside a 100 year old historical building. The rooms are nice and clean with lockers to keep your valuables safe. There is even a kitchen with free tea and coffee! We love the roof terrace that offers epic city views.

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Best Airbnb in Marina de Faro: Luxury apartment with great value

With hotspots around every corner, this is definitely the right place you want to stay at when visiting Faro for the first time. If you’re unsure about what to do or see during the day, reach out to your host and she’ll provide you with great recommendations. The Airbnb is cosy and welcoming, with big windows and bright rooms – definitely a great home.

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Best Hotel in Marina de Faro: Eva Senses Hotel

Eva Senses Hotel is one of the grandest and nicest hotels in Faro. It is situated right on the marina itself, so it offers guests gorgeous seaside views. It’s a 4-star hotel, so you can expect a little pampering to happen. Make sure to take advantage of the complimentary breakfast and the outdoor pool.

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Best Hotel in Marina de Faro: Hotel Faro and Beach Club

Hotel Faro is a dazzling 4-star hotel right off the marina. It has 90 rooms and 4 meeting rooms, and offers spa services. Therefore, it caters to those who want the princess treatment. The rooftop pool and bar and lounge are also luxurious – soak up the glam life at Hotel Faro!

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#2 Cidade Velha – Where to Stay in Faro on a Budget

The Cidade Velha translates simply to Old Town in English. The Cidade Velha is the historical center of Faro. It is surrounded by 9th century walls from the Moorish occupation.

Believe it or not, Cidade Velha is where to stay in Faro on a budget! There are lots of hostel options near Old Town, which are usually housed in beautiful historic buildings.

Cidade Velha, Faro

It is a treat to stay in Cidade Velha, as every street you walk down has an air of Portugal to it. There’s none of the bustling city vibes here. It’s pure Portugese charm.

 

Things to See and Do in Cidade Velha

– Snap a photo with the statue of Faro’s patron saint, Saint Thomas Aquinas.

– Spot the local stork nests on top of street lamps

– Stop by the Gothic Cathedral for a quick photo op

– Visit the Galeria do Trem (Rua do Trem) which showcases the works of contemporary Portuguese and foreign artists alike!

– Take a tour of the Bishop’s palace

– Get lost along the beautiful cobblestoned streets, windowshop and enjoy the scenic Porteugese streets

– Eat traditional Portugese classics at Faz Gostos, make sure to try the xarém (maize porridge)

 

Best Hostel in Cidade Velha: Casa d’Alagoa

Casa d’Alagoa is perfectly located just outside of the old town’s fortified walls. It is directly across from some delicious restaurants too, so you don’t have to wander far to find a good bite to eat! Casa d’Alagoa has a warm, welcoming atmosphere and is a hotspot for young tourists to flock to!

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Best Airbnb in Cidade Velha: Cute private room in house

Better reviews are almost impossible. This very popular and very affordable room, which is located in the city centre, is a real gem. Spacious, nicely designed and with your own bathroom, you’ll find everything you need. Free Netflix is also available. Shared spaces like the living area, kitchen and patio are great for spending the day if you don’t want to go outside.

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Best Hotel in Cidade Velha: Sunlight House

The Sunlight House is a charming bed and breakfast that is known for having super friendly staff, and beautiful rooms. Breakfast is included, which makes your stay in Faro even easier for those night owls out there! There is also a communal kitchen if you want to prepare your own meals.

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Best Rental in Cidade Velha: My Place @ Faro Duplex

Wonderful apartment available for rent that comes with all the typical household amenities. It is a one bedroom apartment that has a balcony that offers seaside views! It’s the perfect spot for those who are looking to snuggle up in clean and cozy apartment.

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#3 Downtown Faro – Best Area to Stay in Faro for Nightlife

Alright, are you wondering where to stay in Faro for nightlife or where to stay in Faro for one night? The answer is definitely Downtown Faro. Faro’s downtown is the most popular place for tourists to visit and stay in Faro.

While it is a metropolitan area, Downtown Faro isn’t one hundred percent modern. The streets are paved in the traditional Portuguese ‘calçada’ style, which are tiny pieces of stones arranged to form a pattern or image, just like a streetside mosaic.

Downtown Faro, Faro
Source: Mauro Rodrigues (Shutterstock)

Downtown Faro is covered in these beautiful street-mosaics that make a stroll through downtown even cooler.

Downtown has some of the best shops, restaurants, bars, and stores to check out that you certainly shouldn’t miss if you’re staying in Faro for just one night! If you’re looking for a night out on the top, with dancing, music, or maybe just a beer, Downtown Faro is the place to be.

 

Things to See and Do in Downtown Faro

– Stroll the beautiful ‘calçada’ style streets and snap as many photos as you can of the intricate designs

– Enjoy a delicious coffee at Café Aliança, which is revered as the third oldest café in all of Portugal

– Visit the Igreja do Carmo, also called the Bone Chapel, which is known for being built out of the bones and skulls of monks!

– Eat a croissant at Pastelaria Gardy, which arguably makes the best croissants in the entire country

– Head over to Anchor Bar to enjoy a delicious cocktail

– Dance the night away at Prestige Dance Club

– Catch a cabaret show at the Dancing Cabaret Music Hall

 

Best Hostel in Downtown Faro: Hostellicious

You wish your bathroom was as clean as Hostellicious’ bathrooms! You won’t be disappointed with the cleanliness, nor with the sweet downtown location of Hostellicious hostel. With many different options for dormitories and budget friendly prices, it’s hard to go wrong with Hostellicious!

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Best Airbnb in Downtown Faro: Stylish loft with cute beach vibe

This loft is super stylish and bright. The kitchen is new, living room and bedroom are incredibly comfortable, and the whole place just feels like a proper home. Located right in the middle of Downtown, you’ll be super close to bars and restaurants. Cool bonus: you can watch sunset and sunrise from your private roof terrace.

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Best Hotel in Downtown Faro: Faro Cosy Guest House

Recently renovated guest house that promises guests a clean, cosy stay! Faro Cosy Guest House has modern vibes and affordable prices, with rooms usually costing around $50 per night or less!

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Best Hotel in Downtown Faro: Guest House São Filipe

Guest House São Filipe is a quaint guest house that only has 11 rooms. It’s small size keeps things quaint and comfortable for guests. The rooftop terrace is an added bonus with their lounge chairs and even one of those swinging couch-chair things we all love so much but never know exactly what to call it.

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#4 Ilha de Faro – Coolest Place to Stay in Faro

Isn’t it wild that the ocean and the lagoon of Ria Formosa are only 10 meters apart from each other in some parts? Faro isn’t technically even a beach resort city, since there are actually no beaches within walking distances of the center of the city.

There are three sandbar islands that are a part of Faro, Ilha de Faro, Ilha da Culatra, and Ilha Deserta. These sandbars offer shelter to the Parque Natural da Ria Formosa. While all three islands are definitely worth visiting, the best place to stay in Ilha de Faro.

Ilha de Faro, Faro
Source: Karol Kozlowski (Shutterstock)

Ilha de Faro translates quite simply to Island of Faro. The Ilha de Faro has plentiful glorious golden sandy beaches with a whopping five kilometers of coastline! The beautiful beach is definitely a big reason why the Ilha de Faro is one of the best places to stay in Faro!

Visit the Praia de Faro for plenty of beach bars and chill cafes. Fun fact, it’s only a five minute drive to the airport from the Praia de Faro. Talk about convenient!

It’s actually known as a party beach and is touted as the busiest beach in the Algarve. There is a bridge that connects the Ilha de Faro to the mainland, and buses leave every 45 minutes. So even if you decide to stay on the Ilha de Faro, you won’t miss out on seeing the rest of Faro. Trust us, the Ilha de Faro is definitely one of the best areas in Faro to stay in.

 

Things to See and Do in Ilha de Faro

– Relax on the beach with a book and catch some sun

– Try out surfing or kite surfing for those who are looking for a dose of adventure

– Feeling even more adventurous? There is a part of the beach where you can sunbathe naked on an unofficial nude beach — just walk east when you arrive

– Kayak down the Ria Formosa

– Enjoy a long walk along the beach on those soft, powdery, golden sands

– Watch the beautiful sunset after a picture perfect beach day

 

Best Hostel in Ilha de Faro: Faro Beach Life Hostel

Right on the sandy shore, Faro Beach Life Hostel couldn’t be in a better spot. What makes Ilha de Faro one of the best neighborhoods in Faro to stay in is the golden sands. So why not stay right on them? With a dorm bed for around $20 a night, Faro Beach Life Hostel is both budget friendly and beach friendly!

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Best Airbnb in Ilha de Faro: Cute house in great location

If you’re looking for comfort and a homely vibe, this Airbnb should be perfect for you. Only 2min from the beach, the little house is located ideally. You also have resaturants, cafes and hotspots around you. It’s a home that’s definitely been lived in, but it’s absolutely clean and very well equipped.

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Best Hotel in Ilha de Faro: Hotel Aeromar

Hotel Aeromar keeps prices friendly and rooms tidy. It’s not ostentatious by any means, but Hotel Aeromar keeps their 23 guest rooms snug, soft, and warm. It’s also a good spot for where to stay in Faro on a budget if you want to be beachside and not crammed in a dorm room.

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Best Hotel in Ilha de Faro: Luxury Beach Guest House

Luxury Beach Guest House lives up to its name. Luxury is promised and luxury is given! It’s one of the coolest places to stay in Faro as it is right on the beach, and you’ll practically feel like you’re sleeping on a bed of roses in these glamorous rooms. Enjoy some seaside sangria for us!

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#5 Montenegro – Best Neighborhood in Faro for Families

Montenegro is the perfect place to stay with kids in Faro. Why is Montenegro recommended as where to stay in Faro with kids? Montenegro is a suburb of Faro that promises guests a more peaceful and restful stay in Faro.

If you happen to be traveling to Faro with a car and with the family, then staying in Montenegro is recommended by our travel experts as it much less busy and hectic than downtown. Take those ear plugs out and enjoy sleeping in this serene suburb.

Montenegro, Faro
Source: Thomas Woodtli (Flickr)

There are lots of parks and green spaces in Montenegro, which is perfect for the picnic lovers out there. There is also lots of room to breathe and fun things to try from tennis to horseback riding. All the fun activities which pretty much answers the question of why Montenegro is where to stay in Faro for families.

 

Things to See and Do in Montenegro

– Head on over to the tennis club for a round of tennis

– Enjoy a true Portuguese meal at O Bandiera, make sure to taste the chocolate mousse

– Go horseback riding at Centro Hípico Equinostrum

– Catch a live performance at Teatro das Figuras, a gorgeous modern facility that brings live shows to life

– Enjoy a stroll at Parque Ribeirinho de Faro

 

Best Airbnb in Montenegro: Family villa with free bikes

This Airbnb has amazing value, especially for bigger groups or families. The villa is located in calm Montenegro, with a couple of shops and restaurants around. The house is massive and absolutely loved by previous guests. The host provides bikes which can be used freely. You should definitely check out the new bike path that gets you right to the city centre.

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Best Hotel in Montenegro: Hospedaria Frangaria

As a supremely great value hotel in Montenegro, the Hospedaria Frangaria is sure to delight. It is known for their wonderful breakfasts that offer guests lots of variety to choose from. The Hosperdaria Frangaria is conveniently located near the airport, and  is both clean and quiet.

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Best Hotel in Montenegro: ibis Faro Algarve

This budget friendly hotel that is situated close to the airport still offers guests a bit of peace and quiet. The ibis Faro Algarve has a lovely outdoor pool nestled in a garden setting which makes you feel tucked away from the city. There is plenty of free parking, and breakfast is available from 4am for those who need to catch an early flight!

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Best Hotel in Montenegro: Hotel Mónaco

Free parking, free wifi, free buffet breakfast along with a giant outdoor pool— Hotel Mónaco has it all! This beautiful 4-star hotel has all the bells and whistles which makes for a perfect stay in Montenegro. The 24-hour health club is also an added bonus for those of us who  want to clock in a little work-out on our holidays!

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Final Thoughts on Where to Stay in Faro

Faro is a charming city to visit and to wander around the traditional Portuguese ‘calçada’ style streets. No matter which neighborhood of Faro you choose, you’re sure to find a piece of Portugese paradise.

To recap our Faro neighborhood guide, Cidade Velha is the best place to stay in Faro if you’re on a budget. There are lots of budget friendly hostels and hotels near Cidade Velha that will keep your wallet happy! We love Casa d’Alagoa hostel with their warm, welcoming atmosphere and historic charm.

If it’s your first time to Faro, and you’re curious where to stay Faro for your first time, or maybe for just one night, indulge a little and stay in a seaside hotel on the Marina de Faro. You’re sure to love the views of the harbor at sunset.

And if you’re looking for the perfect hotel to cozy up in for your Faro trip, Faro Cosy Guest House in Downtown Faro is our top recommendation. It’s moderately priced, recently renovated, and conveniently located. Triple threat!

Are you a Faro aficionado? Let us know your best Faro travel tips in the comments below!

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Getting an estimate from World Nomads is simple – just click the button or image below, fill out the necessary info, and you’re on your way!

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In this EPIC GUIDE, we cover where to stay in Faro based on your travel style & budget. Check out the coolest areas in Faro!