Madeira is a wild, unique, and stunningly beautiful destination in Portugal. It’s an autonomous region located off the northwest coast of Africa, and consists of 4 small islands.

Despite being full of beautiful beaches and even better hikes, not many people have visited the islands. As a result, it can be difficult finding the best places to stay in Madeira. There are plenty of good accommodation options available though, and we’re here to help you find them!

No matter what your budget or travel style, this Madeira neighborhood guide will show you the best places to stay on the islands. We’ve also included our top accommodation and activity picks in each.

Where to Stay in Madeira

Looking for a specific place to stay? These are our highest recommendations for places to stay in Madeira.

Best Airbnb in Madeira – Villa Donna Nadia Ocean

Villa Donna Nadia Ocean Madeira

Bright, welcoming, and located in one of Madeira’s best neighborhoods, this apartment has enough room for 3 guests. It’s located in Canico and offers lovely sea views. It’s also close to popular hiking areas and the beach.

Best Hostel in Madeira – Quinta Splendid Wellness & Botanical Garden

Quinta Splendid Wellness & Botanical Garden Madeira

This hostel in Madeira really is the closest you can get to nature. Located in Canic, it’s set amongst 30,000 square meters of a botanical garden in a 19th century Manor House. The hotel also has an outdoor pool and rooms of varying sizes to suit every travel group.

Best Hotel in Madeira – Turim Santa Maria Hotel

Turim Santa Maria Hotel Madeira

With calming rooms, this hotel is one of the best places in Madeira to stay in if you want to be in the heart of Funchal city. It’s a clean, modern building with a restaurant and bar on-site, which provides a delicious breakfast daily.

Madeira Neighborhood Guide

FIRST TIME IN MADEIRA
Funchal Madeira
FIRST TIME IN MADEIRA

Funchal

Funchal is easily the best choice when you’re deciding where to stay in Madeira for your first time. As the capital city of Madeira, it has a good collection of accommodation options as well as plenty of historical landmarks and natural gardens to explore.

ON A BUDGET
Santa Cruz Madeira
ON A BUDGET

Santa Cruz

Santa Cruz is a small coastal town that’s close to Funchal and to the airport, so you won’t have to travel far to get in and off the island or to see a bigger city.

FOR FAMILIES
Calheta Madeira
FOR FAMILIES

Calheta

Calheta is on the sunny side of the island and has great weather almost year-round. This is why it’s become a popular choice when people are deciding where to stay in Madeira for families as it offers a popular beach as well as all the outdoor activities and water sports you could ask for.

FOR HIKING
Machico Madeira
FOR HIKING

Machico

If you like to stay in an area that has lots of amenities without the busy city vibe, then Machico is a good choice. It’s not as large as Funchal but still has lots of restaurants, bars, shops, and hotels.

Madeira is an awesome place to stay in Portugal. Unfortunately, the islands are fairly difficult to navigate due to the lack of public transport between neighborhoods. That’s why it’s important to choose the area most suited to what you want out of your trip!

Funchal is the capital of the island and offers the best range of attractions, as well as easy access to outdoor activities. It’s the best place to come to get to know Madeira on your first visit, and is full of bars and restaurants.

If you’re traveling on a budget, you can’t go wrong staying in Santa Cruz. It’s a small beach area, and is close enough to Funchal so you can explore the big city without paying higher accommodation prices.

Calheta is the best area in Madeira to stay if you just want to chase the sun. It’s a vibrant area full of shops and restaurants but has a laid-back and relaxing atmosphere. It’s also an ideal destination if you’re looking for accessible hikes and a good beach.

Finally, Machico is the other small city (after Funchal) well positioned to some of the most beautiful nature on the island.

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4 Best Neighborhoods to Stay in Madeira

There are lots of great neighborhoods in Madeira, but these are some of the best for travelers.

1. Funchal – Where to Stay in Madeira on your First Visit

Funchal Madeira

COOLEST Thing to Do in Funchal – Head up to Monte and take the cable car for the most spectacular views of the city and its surrounds.
BEST Place to Visit in Funchal – Visit the Qunita das Cruzes museum to explore the history of the captain who discovered Madeira.

Funchal is easily the best choice when you’re deciding where to stay in Madeira for your first visit. As the capital city of the island, it has plenty of accommodation options, historical landmarks and natural gardens to explore. It’s also laden with restaurants, so you’ll never have to venture far for a bite to eat.

Staying in Funchal will also help you overcome the issue of transport on the island. Despite being fairly small, Madeira can be hard to navigate as there aren’t any public transport links between the different areas. In Funchal, you’ll find plenty of tour companies that will help you travel around the island without too much fuss.

Best Airbnb in Funchal – Funchal Centrum

Funchal Centrum Madeira

This apartment is just as advertised, located in the best neighborhood to stay in Madeira right in the heart of Funchal. It offers clean, modern spaces, its own balcony and enough space for four guests.

Best Hostel in Funchal – Residencial Colombo

Residencial Colombo Madeira

Located in the heart of the city, this hostel in Madeira has all the charm and colour you could want for your vacation. It’s next to bus stops, restaurants and ten minutes’ walk from the Marina. In addition, the rooms are big, bright, and have their own private bathrooms and kitchenettes. There’s even a terrace with a view where you can have breakfast every morning, and most rooms have their own balcony.

Best Hotel in Funchal – Hotel Orca Praia

Hotel Orca Praia Madeira

Set on a cliffside in one of the most stunning locations imaginable, this hotel in Madeira offers a touch of luxury and majesty. It’s right next to the beach and has spacious rooms with balconies, as well as a pool with staggeringly beautiful views. It’s close to the city center as well, so you wont’ have to go far to explore.

Things To See and Do in Funchal:

Madeira Funchal Clip
A perfect place to get away
  • Wander through the European-inspired botanical gardens.
  • Head down to the local market Mercado dos Lavradores for the smells and flavors of the city.
  • Try some food at Prima Caja or if you are in the mood for Cuban, head to one of my weekly haunts; Mad Cuba.
  • Explore the Old Town and wander down the Rua de Santa Maria to take in the artwork.
  • Take some great photos of the gorgeous Gothic Se Cathedral.
  • Wander through the gardens and mineral museum at the Monte Palace Madeira.
  • Take some pictures and hang out at the café at the Pico dos Barcelos Lookout.
  • Try some local wine or cocktails at Bar Number Two, Old Town Bar, or Hole in One.

2. Santa Cruz – Where to Stay in Madeira on a Budget

Santa Cruz Madeira

COOLEST Thing to Do in Santa Cruz – Take in the fabulous views at the Cristo Rei de Garajau Viewpoint
BEST Place to Visit in Santa Cruz – Take a trip to the Aquaparque Madeira to amuse the kids with water slides!

Santa Cruz is a small coastal town close to both Funchal and to the airport, so you won’t have to travel far to to and from the island or a bigger city. This makes it the best choice when you’re trying to decide where to stay in Madeira on a budget.

This town has great access to beaches and numerous attractions, so you can enjoy an action-packed trip. You can also head into Funchal at any time to enjoy the big city, before retreating to your quieter, cheaper base.

Best Airbnb in Santa Cruz – Casa Miradouro 2

Casa Miradouro 2 Madeira

Couples will love this apartment for its amazing city views, beach and countryside. It’s got clean, bright decorations and is close to everything. It’s reasonably priced, so you won’t have to break the bank to enjoy a holiday on the beach.

Best Luxury Airbnb in Santa Cruz – House by the Sea

House by the Sea Madeira

This house is a good choice if you’re trying to decide where to stay in Madeira with kids. It overlooks the sea and is just moments from Santa Cruz’s downtown area. With its own pool and gardens, there’s lots of room in this house to spread out and play in.

Best Hotel in Santa Cruz – Albatroz Beach & Yacht Club

Albatroz Beach & Yacht Club Madeira

There’s nothing quite like a hotel in Madeira with stunning views from every window. If you’re looking for spacious rooms and a pool with ocean vistas, Albatroz is the place to be.

Things To See and Do in Santa Cruz:

Madeira Santa Cruz Port
  • Marvel at the beautiful architecture of the Igreja de São Salvador Church.
  • Play a round at the Santo da Serra Golf Club.
  • Go diving at the Haliotis Dive Center Madeira.
  • Take in the views at the viewpoint known as Miradouro de Machico.
  • Have a drink at Barreto’s Bar or Bar 7 Instrumentos.
  • Try the local food at Restaurante Gonclaves, Taberna do Petiscro, or the Franco Wine Bar & Restaurante.
  • Let the kids enjoy some high-speed action at the Indoor Kart Madeira.

3. Calheta – Best Neighborhood in Madeira for Families

Calheta Madeira
source: wander motion (shutterstock)

COOLEST Thing to Do in Calheta – Head down to the popular beach Praia da Calheta for swimming and sunbathing.
BEST Place to Visit in Calheta – The Museu de Arte Contemporânea da Madeira for a look at the island’s art scene.

Calheta is on the sunny side of the island, and has great weather almost year-round. It’s become a popular choice for where to stay in Madeira for families, as it offers a friendly beach and water-sport activities. If you enjoy windsurfing, canoeing, snorkeling or anything else, you’ll find it here.

This area is also one of the best places to stay in Madeira for hiking. So if you’re up to it, lace up your hiking shoes and head out to explore the region on foot!

Best Airbnb in Calheta – Casa das Abertas

Casa das Abertas Madeira

This lovely modern apartment has great views and enough space for up to four guests. The best thing about this accommodation is the sun terrace, which provides lots of natural light and views over the ocean. It also boasts a full kitchen, two bedrooms and lots of restaurants and shops within a few minutes’ drive.

Best Luxury Airbnb in Calheta – Villa Palheiros

Villa Palheiros Madeira

Designed for up to six guests, this villa is a good choice when you’re trying to decide where to stay in Madeira for families. It’s in a quiet area and offers great views and infinity pool. Everything you’ll need during your stay is either in the house, or within five minutes’ drive away.

Best Hotel in Calheta – Saccharum

Saccharum Madeira

This hotel offers the perfect luxurious experience to anyone with a bit more to spend on accommodation. It’s also one of the coolest places to stay in Madeira, as each room was designed by a local artist. In addition, the decor is based on a sugar cane theme, which makes for some interesting images! There’s a restaurant and infinity pool, and sporting facilities.

Things To See and Do in Calheta:

Calheta Madeira
Calheta is perfect for families and adventure lovers.
source: Andreas Bohrer (shutterstock)
  • Get out into the sea and try your hand at some water sports.
  • Have a meal at Restaurante Estrela, Mudas Restaurant, or Leme Marisqueira.
  • Relax with a drink at Bar Formiga or Bar Calheta Beach.
  • Go on a whale or dolphin watching tour off the island.
  • Try the Levadas of Rabacal walk, which can be adjusted to suit more advanced or beginners to hiking.

4. Machico – The Alternative City (to Funchal)Vibes

Machico Madeira
source: Balate Dorin (shutterstock)

COOLEST Thing to Do in Machico – Test yourself on the famous Vereda da Ponta de São Lourenço hike.
BEST Place to Visit in Machico – Check out the black sand at Sao Roque Beach.

Machico is home to some of the best hikes in Madeira. It also contains lots of popular and sometimes quirky beaches, as well as chances to enjoy outdoor activities like swimming and water sports. The food is also spectacular in this area, with some of the best seafood restaurants you’ll ever step foot in!

If you like to stay in an area that has lots of amenities without the busy city vibe, then Machico is a good choice. It’s not as large as Funchal but still has lots of restaurants, bars, shops, and hotels. It’s also really close to the airport, so you won’t have to worry too much about transport during your stay.

Best Airbnb in Machico – Casa Miguel

Casa Miguel Madeira

This apartment is ideal if you want to be in the best area of Madeira for hiking and other outdoor activities. It has three bedrooms sleeping up to six guests, and is close to the beach with great views over Machico.

Best Luxury Airbnb in Machico – The Swan House

The Swan House Madeira

Situated in the middle of 10,000 square meters of lush garden, this luxury Airbnb shares its grounds with swans and other beautiful creatures. The Airbnb offers perfect tranquility close to the heart of Madeira, and boasts floor to ceiling windows, high ceilings, and enough space for up to ten guests.

Best Hotel in Machico – PortoBay Serra Golf

PortoBay Serra Golf Madeira

If you have a little extra to spend, this hotel is great when you’re deciding where to stay in Madeira for one night or longer. It’s surrounded by gardens and offers direct access to the golf club, as well as a restaurant with homemade delicacies. There are lots of common spaces in the hotel where you can relax and read, play games, and get to know fellow travelers.

Things To See and Do in Machico:

Machico Madeira Town
Come here if you love hiking and nature!
source: Helena001 (shutterstock)
  • Relax at the popular Praia de Machico beach.
  • Go whale watching off the coast.
  • If you’re looking for a quieter beach, try the yellow sands of the Banda D’ Alem.
  • Check out the Levada dos Maroços hike.
  • Follow the trail up to Viewpoint Portela to take in rewarding views.
  • Explore the caves at Furnas do Cavalum.
  • Have a meal at the Blue Restaurante, O Secreta, or Restaurante Lily’s.

Final Thoughts on Where to Stay in Madeira

Madeira is an island that seems made for people who enjoy the outdoors. It’s a haven for hikers and beach lovers alike, but is often missed by travelers visiting Portugal.

If you’re still unsure, you can’t go wrong with Quinta Splendid Wellness & Botanical Garden. The location is unbeatable, and the rooms on offer range to suit any type of traveler. For something more upmarket, the stylish Turim Santa Maria Hotel has everything you could need for a comfortable trip.

And don’t forget to take out Travel Insurance for your trip! I have been using World Nomads for some time now and made a few claims over the years. They’re easy to use, professional and relatively affordable. They may also let you buy or extend a policy once you’ve started your trip and are already abroad which is super handy.

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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