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The best place to stay in Lisbon – Area guide

Lisbon is a capital city with plenty of charm and one of our favourite places to visit. Unlike other busy European cities, it seems more laid-back and colourful, yet it still has a rich history and story to tell…For first timers or returning visitors that want somewhere new and different to stay, find the best place to stay in Lisbon using our guide below. We cover the top locations for seeing different parts of the city and some excellent hotel options for every budget.

The best areas to stay in Lisbon

Whilst Lisbon has many districts spread throughout the city, the following are the very best due to their location for seeing the sights and the variety of accommodation and restaurants/bars. They’re also very safe. Each neighbourhood has something unique to offer so be sure to browse all options and choose the district that stands out to you the most! Will you go for a hip and trendy nightlife area or a quiet and cultural place with a more local vibe?

JUMP TO: Baixa | Bairro Alto/Chiado | Alfama | Avenida da Liberdade | Graça


Best place to stay in Lisbon - Shows the streets of Baixa

Baixa is the tourist centre and beating heart of the city. It’s the place that most people choose to stay in Lisbon due to its central location, which is within a short walk from many of the main attractions. It also has plenty of hotels, bars and restaurants and the streets are long, narrow streets are an excellent place to wander around.

We recommend Baixa as the best place to stay in Lisbon if you plan on doing plenty of sightseeing or if it’s your first time in the city. You won’t have to catch much public transport and will be able to soak in the rich cultural atmosphere. We personally love walking down the streets of Baixa marvelling at the main squares, mosaic streets and mix of historic and modern buildings. You’ll find accommodation for all budgets too!

Best for: First-time visitors and those than want a central ‘tourist’ location within walking distance of most attractions.

The best Baixa hotels:

Luxury: Hotel Avenida Palace

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This photo of Home Lisbon Hostel is courtesy of TripAdvisor

As one of the most exclusive and prestigious 5-star hotels in Lisbon, the Avenida Palace Hotel has a traditional Portuguese flair that’s a reflection of the city’s heritage. Contemporary and classical.

Moderate: Augusta Boutique House

View on | TripAdvisor Rating 4.5/5

This photo of Augusta Boutique House is courtesy of TripAdvisor

Tucked back from one of the main shopping streets in the Baixa area, Augusta Boutique House is a pleasant, spacious hotel with balcony views of the bustling streets below. Rooms are bright and cosy and the hotel feels more like apartment living than a hotel – which we like. It has excellent reviews.

Budget: Home Lisbon Hostel

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This photo of Home Lisbon Hostel is courtesy of TripAdvisor

Home Lisbon is a hostel unlike any other hostel you’ve ever been to. Forget combined living with strangers in a basic room, hostel-life at Home is welcoming and feels like being part of a family. Join nightly family dinners, daily group tours and bar crawls, and meet people from all over the world. Both dorm and private rooms are available and the hostel has plenty of facilities.

Bairro Alto / Chiado

Shows Bairro Alto streets and restaurants - The best area to stay in Lisbon

The old narrow streets of Biarro Alto make it one of the most charming Lisbon communities. Locals live alongside tourists in rented apartments and there are nice bars and small shops on every corner. In the summertime and during key festivals, the streets are alive with parties, parades and decoration and you’ll be welcomed to join the festivities in this popular central district.

Biarro Alto is also one of the main nightlife areas of Lisbon. It’s tradition to order a cheap beer or glass of wine in one of the many bars that line the streets and drink outside with the locals. You’ll find that the streets are much busier than the bars as everyone gathers outside to chat and meet new people! Accommodation-wise, many of the best places to stay are private apartment rentals and hostels; you won’t find many hotels. Just next to Bairro Alto, you have the slightly busier Chiado district that’s centred around a main square. It features the same quaint atmosphere of Bairro Alto, but with more shops and hotels. Both locations are very similar and are some of the best areas to stay in Lisbon.

Best for: Nightlife lovers, those that like trendy/artistic places to stay and have an AirBnb/private apartment preference over hotels.

The best Bairro Alto / Chiado hotels:

Luxury: The Lumiares Hotel & Spa

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This photo of The Lumiares is courtesy of TripAdvisor

Luxury apartments with a spectacular rooftop view of Lisbon. Stay in a spacious duplex apartment with a kitchen, enjoy a nice meal in the balcony restaurant or enjoy sunset with a glass of wine. The Lumiares location and scenery is excellent and rooms are very large.

Moderate: A Casa das Janelas com Vista

View on | TripAdvisor Rating 4.5/5

This photo of A Casa das Janelas com Vista is courtesy of TripAdvisor

An aparthotel in the very heart of Bairro Alto. The building itself is on one of the main festival streets and you’ll have a nice view of this trendy neighbourhood from your bedroom window. Rooms are individually decorated with unique pieces of furniture and it has a charming, artistic edge.

Budget: Lookout Lisbon Hostel

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This photo of Lookout Lisbon Hostel is courtesy of TripAdvisor

Like many of the hostels in Lisbon, Lookout is excellently managed and is welcoming to travellers of all ages. Being in the heart of Bairro Alto, it tends to attract a younger crowd for the nightlife but is in no way a party hostel. You’ll get a good night’s sleep. They also organise tours and daily social activities!


The best place to stay in Lisbon - Shows the colourful rooftops of the Alfama district

Alfama is the hilltop labyrinth of houses, shops and restaurants that overlooks Lisbon to the east. As one of the oldest districts and the home of traditional Fado folk music, it has a unique charm and is an eclectic mix of locals that have lived there for decades, alongside tourists that want to stay in the prettiest area of Lisbon. Board the tram and get lost on the narrow streets or stop for a quiet coffee in a corner café and people-watch.

Many people visit Alfama for the stunning viewpoint, which is one of the best in Lisbon, however they stay for its quiet atmosphere and cool collection of traditional shops, bakeries and cafes. It’s also fairly central for exploring the rest of the city. Board and tram or bus to take you to the main Praco Comercio square within 10 minutes or walk to the nearby castle and catch a Tuk Tuk. It’s a district that suits those that want some peace and quiet away from the bustling centre and some spectacular views.

Best for: Those that want a quiet, cultural atmosphere that’s not too far from Lisbon’s central attractions.

The best Alfama hotels

Luxury: Casa dell’Arte Club House

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Everything from the exterior to the grand dining rooms and four-poster bedrooms is extravagant in design at the Casa dell’Arte. The patterned walls, floors and ceilings are an artistic representation of the mosaic design that Lisbon is famous for and everything about your stay will feel luxurious.

Moderate: Alfama Lounge Suites

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This photo of Alfama Lounge Suites is courtesy of TripAdvisor

Feel at home in these modern, artsy and spacious apartments, tucked away in a quaint alley of the winding Alfama streets. Rooms are individually decorated and spacious.

Moderate/Budget: Sweet Lisbon Guesthouse

View on | TripAdvisor Rating 4.5/5

This photo of Sweet Lisbon Guesthouse is courtesy of TripAdvisor

Sweet Lisbon Guesthouse provides excellent value for money. Rooms are individually decorated with a quirky vintage style and are nice and bright. Peer out of your window on a morning for an beautiful view of the colourful Alfama streets and rooftops.

Avenida da Liberdade

Shows Marquais de Pombal statue in Lisbon - Best area to stay in Lisbon
Image courtesy of Palickap Wikicommons CC

Avenida da Liberdade is a long street of bars, restaurants, designer shops and cafes that stretches from the centre of town to the north. As one of the most upmarket places to live and stay in the city, it suits business travellers or those that want a luxurious base for exploring Lisbon. Stay in one of the many boutique or prestigious hotels, enjoy a cocktail in a rooftop bar or shop til’ you drop with some of the world’s most well-known fashion brands.

Avenida da Liberdade is well positioned for access to many galleries and museums and you can take public transport to other areas of Lisbon with ease. It’s a truly beautiful place to stay that reflects the colours and architecture of Lisbon throughout, with fountains and trees decorating the streets and corner cafes to enjoy a coffee. Expect to pay slightly higher prices for accommodation than other areas of the city and to catch a cab or use public transport to get to the main attractions.

Best for: Luxury travellers, couples, families and those that want an upmarket and well-maintained place to stay.

The best hotels near Avenida da Liberdade

Luxury: Tivoli Avenida Liberdade Lisboa

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This photo of Tivoli Avenida Liberdade Lisboa is courtesy of TripAdvisor

A world-famous hotel brand that is know for its luxury and fine surroundings. Everything from the lobby to the cocktail bar has a classy, modern design and the hotel boasts an outdoor pool and rooftop bar.

Luxury: Heritage Avenida Liberdade, a Lisbon Heritage Collection

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This photo of Heritage Avenida Liberdade, a Lisbon Heritage Collection is courtesy of TripAdvisor

One of the top-rated and most luxurious boutique hotels in Lisbon. The Heritage Avenida Liberdade is a signature hotel that appears much like an art gallery. Common areas and rooms are beautifully decorated with fine art and sculptures and it has a swimming pool where you can wind down after a day of sightseeing.

Moderate: BessaHotel Liberdade

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This photo of BessaHotel Liberdade is courtesy of TripAdvisor

A surprisingly affordable boutique hotel with excellent reviews and an outdoor swimming pool, BessaHotel is one of the best-value for money places to stay on Avenida Liberdade. Relax in the outdoor garden area, workout in the gym or sample the delicious restaurant cuisine. It’s packed with facilities.


Best places to stay in Lisbon - Shows the streets of Graca with a yellow tram

We’ve included Graça for all of those travellers that want to stay just outside the tourist centre, in a district that shows you what it feels like to live in Lisbon alongside the locals. Graça is a quaint working-class district that isn’t too far away from the centre, and is just over the hill from the famous Alfama district. This authentic Lisbon neighbourhood is where you’ll find much more affordable and authentic restaurants, great value accommodation and some peace and quiet.

It’s a great-looking place to stay in Lisbon too! It has the same colourful houses and cobbled streets of Chiado, alongside the hillside scenery of Alfama, and some intriguing street art. The only downside is that you’ll have to catch a tram or bus to the main areas of the city centre for some sightseeing, but it’ll only take you around 15-20 mins. That’s a good trade-off to stay in this traditional and character-some corner of town.

Best for: Returning visitors to Lisbon that have already stayed in the city centre, those that like less-touristic places to stay and travellers on a budget.

The best hotels in Graça, Lisbon

Moderate: Tings Lisbon

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This photo of Tings Lisbon is courtesy of TripAdvisor

A welcoming guesthouse with a community vibe. Stay in your own spacious room and join other couples and solo travellers out on the rooftop on an evening. The views of Alfama in the distance are stunning and the hotel has excellent reviews!

Budget: Johnie’s Place Lisbon Hostel & Suites

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This photo of Johnies Place Lisbon Hostel & Suites is courtesy of TripAdvisor

Johnie’s is a basic and affordable but perfectly pleasant place to stay in Lisbon. It’s located on the edge of the Graca district right next to Alfama, inside an enchanting 17th-century building. Go for a private room with colourful décor or stay in a dorm to save money. Friendly and warm.

Budget: Portugal Ways Graça Modern Apartments

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This photo of Portugal Ways Graca Modern Apartments is courtesy of TripAdvisor

Treat the Graca neighbourhood like home in your own modern and spacious apartment, where you can cook your own meals and snuggle up in the living room watching TV. The Portugal Ways Graca Modern Apartments are a nice place to stay for longer periods or if you want more space than a hotel room.

Top tips for finding one of the places to stay in Lisbon

Top tips for finding the best place to stay in Lisbon - Shows yellow tram and church
  • Find an area you like first before searching for hotels. There’s a lot of accommodation to choose from and some eye-catching deals but location is everything!
  • Book a neighbourhood within walking distance of your favourite attractions and things you want to see. Love nightlife? Bairro Alto is the way to go. A big fan of art galleries? Chiado or Avenida Liberdade are perfect!
  • If you’re staying for an extended period of time such as a week, consider staying in two completely different areas for unique experiences.
  • When travelling with a large group of friends or family, consider booking a private apartment on AirBnB. Private apartments are also a great way to save money as you can cook your own meals.
  • If you have trouble walking or a disability, consider staying in Baixa or other areas to the west of the city centre. The eastern neighbourhoods of Alfama and Graca have many steep hills.
  • Choose a hotel with free on-site parking if you plan on renting a car during your visit to Lisbon.
  • Whilst hotels with swimming pools aren’t that common within Lisbon’s city centre, there are still plenty to choose from. Choose a pool hotel if you fancy combining sightseeing with some pool relaxation. Lisbon’s weather is excellent between April and October!

Whatever area you choose to stay in Lisbon, we’re confident that’ll you love this colourful capital and will want to come back again. Each neighbourhood has something unique to offer and are worth visiting even if you’re staying somewhere else! For ideas on the top things to do and nearby daytrips, check out our Lisbon attractions guide here.

Already decided on the best place to stay in Lisbon? Book your accommodation for the best price using our hotel booking guide.

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