Where to Stay in Faro: Best Neighbourhoods and Hotels

Faro is Portugal’s most under-appreciated city break. Every year, a few million travellers fly through Faro International Airport and immediately pick up a hire car for the beach resorts further west. The ones who linger — even for a single night — find a walled medieval old town, a flamingo estuary, a bone chapel, and a marina with good fish restaurants at prices well below Lisbon or Porto.

Choosing where to stay here is straightforward because Faro is small. The walled Old Town and the newer commercial district on Rua de Santo António are within easy walking distance of each other and of the marina. The main decision is how close you want to be to the historic core versus the restaurant strip.

Old Town (Cidade Velha)

The Cidade Velha sits within Roman and Moorish walls that were rebuilt after the 1755 earthquake. It contains the cathedral (Sé Catedral), the Roman arch (Arco da Vila), and the municipal museum in a former convent. The marina runs along its southern edge. It’s the most atmospheric part of Faro and completely walkable.

Recommended hotels:

• Hotel Faro & Beach Club — four-star hotel with rooftop pool and panoramic views over the Ria Formosa lagoon, positioned right on the marina. Faro’s best-placed upscale option. From approximately €130–200 per night as of 2026.
• Pousada Palácio de Estoi — technically 11km outside Faro near Estoi village, but worth including for its setting in a converted 18th-century baroque palace. From approximately €170–270 per night.
• Casa de Cima Boutique Guesthouse — small, thoughtfully decorated guesthouse in the old town, run by an attentive owner. Excellent for solo travellers and couples. From approximately €80–130 per night.
• Pensão São Filipe — compact, well-kept guesthouse within the walls with basic but comfortable rooms. From approximately €45–75 per night.

Pros: Walking distance from the cathedral, bone chapel, and lagoon pier. Restaurants facing the marina offer good seafood without being overpriced. Less traffic than the new town.

Cons: The old town is very small — the same square can feel quiet mid-morning and too lively late on summer evenings. Fewer budget options than the new town.

Best for: Couples, culture-focused visitors, those staying two or more nights.

---

New Town (Baixa / Rua de Santo António)

The pedestrianised shopping street of Rua de Santo António runs north from the old town walls through the modern commercial centre. This area has the highest density of restaurants, bars, and accommodation options at every price point.

Recommended hotels:

• Hotel Téâtro — converted cinema building on Rua de Santo António, stylish design interiors, rooftop terrace. From approximately €100–160 per night.
• Hotel Eva — long-established four-star on Avenida da República overlooking the harbour. Functional, well-positioned, and reliably priced. From approximately €90–150 per night.
• Residencial Madalena — clean, friendly guesthouse a few minutes from the pedestrian zone. Good value for the location. From approximately €50–85 per night.
• Hostel Faro — well-reviewed hostel on Rua da Madalena near the station. Dorm beds from approximately €18–35 per night; private rooms available.

Pros: Best restaurant density, easy bus and taxi connections, close to the train and bus station, budget options available.

Cons: More traffic and noise than the old town, less atmosphere in the evenings once shops close.

Best for: Budget travellers, those arriving by bus or train, short overnight stays before or after a flight.

---

Near the Airport

Faro Airport has limited accommodation immediately around it — most of what exists caters to flight crews. If your flight is very early or very late, the town centre is still the better choice given the short transfer time.

Recommended hotels:

• Holiday Inn Algarve — the closest full-service hotel to the airport, about 1.5km away on the EN125 road. Pool, restaurant, reliable chain-standard. From approximately €80–140 per night.

---

Getting to Faro

From Faro Airport: Taxi or Uber approximately €10–15 to the town centre (15 minutes as of 2026). Bus route 16 runs to the bus station for approximately €2.40 (around 30 minutes). Car hire desks are at arrivals.

From Lisbon by train: Alfa Pendular trains from Lisbon Oriente take approximately 2 hours 45 minutes to Faro. Tickets from approximately €25–45 depending on class and advance booking as of 2026.

From Porto by train: Via Lisbon. Total journey approximately 5 hours. Intercidades services connect the three cities.

From Lagos or the western Algarve: Regular regional trains from Lagos to Faro take approximately 1 hour 10 minutes. Cost approximately €5–8 as of 2026.

---

For transfers from Faro Airport directly to your hotel, pre-booked airport transfers offer fixed pricing. Travel insurance is particularly useful if you’re flying into Faro for a multi-city trip — cancellation coverage gives flexibility if connections change.

Which Area Is Right for You?

Your priority	Best area
Atmosphere and history	Old Town
Restaurants and convenience	Rua de Santo António
Budget accommodation	Baixa / new town hostels
Early morning flight	Holiday Inn or new town (short taxi)
Peace and rural setting	Pousada de Estoi

Faro works particularly well as an opening or closing night on an Algarve itinerary. For the full picture of what to do while you’re here, see the Faro travel guide covering the Ria Formosa, the bone chapel at Igreja do Carmo, and which islands to visit on a day boat.