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Where to stay in the Algarve

If you’ve decided to plan a trip to the south of Portugal and are researching where to stay in the Algarve, you’ve came to the right place! After touring this beautiful regional of the country and visiting for holidays over the past decade, we’ve assembled a guide on the best towns, beaches, resorts and hotels. Get a feel for the atmosphere of each destination and find the perfect place to stay.

Each of the areas we’ve listed has something unique to offer and are worth visiting in themselves. The good news is that everything in the Algarve is within a short drive, so you can experience the charm of each area no matter where you choose to stay. For each of the destinations, we’ve listed some of the best hotel options for every budget. They were chosen based on our own experiences and Tripadvisor reviews.


Where to stay in the Algarve - Overhead shot of Alvor Beach
Walking through Alvor town - The best Alvor Hotels

It’s not one of the biggest or most popular places to stay in the Algarve, but it’s one of the best in our opinion. Alvor is a former fishing village that’s now a thriving tourist town. Many expats have chosen to call it home and it has a good mix of everything. Whilst appealing to tourists, it doesn’t have the crowds, high prices and commercialism that this usually brings. It has very much retained its old town charm.

Go for a morning stroll on the boardwalk and watch the boats heading out or hang out in a bakery in town. White-washed buildings, coloured window shutters and narrow alleyways give Alvor the authentic Portuguese facade that you’d expect. Old sits alongside new and there are plenty of nice bars, restaurants and shops to check out. Within a 10-minute walk of town, you then have a long stretch of sandy beach and boardwalks that stretch over miles of marshland. Alvor is a small but action packed place to stay. It’s also perfect for couples!

Best for: Culture, sightseeing, couples

The best Alvor hotels

Luxury: Pestana Alvor South Beach
Moderate: Pestana Alvor Park Hotel
Affordable: Dunas do Alvor Apartments


Where to stay in the Algarve - Quaint square in Lagos town
The best Lagos hotels - Ponta da Piedade cliffside

We spent an entire month in Lagos and it quickly became one of our favourite places in the Algarve. With a local population of 30,000, you can visit any time of the year and most restaurants, bars and shops are likely to be open, which you won’t find in other many other Algarve tourist towns. It’s home to a beautiful old town with narrow cobbled streets, colourful buildings and quaint churches. Next door to the old town, a long promenade leads to a huge marina of yachts and its historic sites include a medieval fortress and castle.

Just outside of town, there’s an abundance of beaches, from long white sand varieties to golden cliffs with caves and grottos. Ponta da Piedade is the most notable Lagos attraction and many boat trips head there from town. Accommodation wise, you have a number of boutique hotels by the marina, luxury hotels near the coastline and one of the best hostel selections for solo and budget travellers.

Best for: Beaches, boat trips, local culture

The best Lagos Hotels

Luxury: Cascade Wellness Resort
Moderate: Villas D. Dinis
Affordable: Canavial I & II Apartments


The colourful buildings of Carvoeiro Town
The best Carvoeiro hotels - Shows people relaxing on a beach

Much like Alvor but with more of a beach town atmosphere, Carvoeiro is popular with tourists, expats and locals. The town is small but very picturesque and stacks up against a hillside, looking out at the sea. Its beach is small but beautiful and it has a nice selection of bars and restaurants. Go for a long morning walk on the Alvor Seco boardwalk – staying in Carvoeiro is all about a holiday by the sea.

Carvoeiro is perfectly located for exploring some of the Algarve’s best attractions too. Benagil Caves, Praia da Marinha (widely regarded as one of the best beaches in Portugal) and Slide and Splash Water Park are just a short drive away. The town suits those that want a traditional beach holiday alongside a small-town vibe. It doesn’t feel too overcrowded, no matter the month of the year you visit. Hotels here are on the smaller ‘boutique’ side, rather than grand resorts and most are located just outside of the main town area.

The best Carvoeiro hotels

Moderate: Pestana Palm Gardens
Moderate: Placid Village
Affordable: Monte Dourado Resort


Vilamoura marina yachts and Tivoli hotel - Where to stay in the Algarve
Susie at Vilamoura marina - The best Vilamoura hotels

Vilamoura is a purpose built town that was designed for tourism. It’s home to some of the most luxurious hotels in the Algarve, an abundance of golf courses and the largest marina on the south coast. It goes all out to provide you with a higher-end holiday experience of gourmet dining, 5-star yacht trips and champagne brunches. It’s a fairly small town and you can walk almost everywhere.

Vilamoura is a great place to stay for those that seek lots of leisure activities and the luxury living of 5-star hotels, but it does lack the traditional Portuguese culture and history of other towns. For that you’ll need to rent a car and explore. It boasts some excellent accommodation options and you’ll be spoilt for choice with boat trip itineraries.

Best for: Eating out, scenic walks and luxury hotels

The best Vilamoura hotels

Luxury: The Lake Spa Resort
Moderate: Pinhal da Marina
Affordable: The Old Village

Praia do Rocha / Portima

Praia da Rocha boardwalk - Where to stay in the Algarve
Shows Praia da Rocha beach from above - The best Praia da Rocha hotels

If you’re after a traditional beach holiday with lots of bars and restaurants, Praia da Rocha is one of the best places for it. It has an allure to young people due to its lively beach bars, but families and couples are at home here too. It boasts one of the longest sandy beaches in the Algarve, with plenty of space for relaxation. Right next to the beach you have a boardwalk of bars and restaurants and an all-day beach club, No Solo Agua.

Many of the hotels in Praia da Rocha overlook the beach front and you’ll only ever be within a few minutes’ walk of the sand. Whilst the core of this summer destination is a traditional beach holiday, it’s also well located for exploring other parts of the Algarve. Portimao Old Town, Silves, Alvor and impressive beaches such as Praia dos Tres Irmaos are only a short drive away.

Best for: Beach relaxation, eating out and nightlife

The best Praia da Rocha hotels

Luxury: Bela Vista Hotel & Spa
Moderate: Jupiter Algarve Hotel
Affordable: Plaza Real Atlantichotels


The best places to stay in the Algarve - Albufeira beach
Albufeira old town streets and restaurants - The best Albufeira hotels

A ‘where to stay in the Algarve’ list would not be complete without Albufeira. As the largest tourist destinationin the region, it’s the top choice for holiday seekers and has the largest number of bars, restaurants and activities. It’s also very central on the coastline, so you can visit the sites to the east or west in a short drive.

Albufeira is split up into ‘old town’ and ‘new town’ areas, with our favourite being the old town. You then have Falesia, which is part of Albufeira and a popular place to stay for families. The new town is the go-to destination for young travellers that want a vibrant nightlife, whilst the old town has a more laid-back feel and a healthy dose of Portuguese history.

Albufeira is probably the busiest and most touristic place to stay in the Algarve, but many people like the upbeat atmosphere and variety of shops, bars and restaurants that comes with it.

Best for: Nightlife, lively atmosphere, variety of accommodation options, affordability.

The best Albufeira hotels

Luxury: EPIC SANA Algarve Hotel
Moderate: Eden Resort
Affordable: Aparthotel Oceanus


Tavira Roman Bridge
A quiet alleyway in Tavira town - The best Tavira hotels

Tavira suits those that want a quaint local town as a base, and a true feel of Portuguese culture. It’s one of the best places to stay in the Algarve for a laid-back atmosphere and feels much less touristic than other destinations on our list. A hilltop castle, roman bridge and old Gothic and Renaissance churches are the highlight of this charming town. Small cafes sit on every corner and the buildings are a variety of pastel colours.

We personally love wandering the streets on a morning and popping into a bakery for breakfast. Life in Tavira is quiet, the hotels are small and ‘boutique’ over grand and luxurious, and we recommend it for shorter stays. A long weekend is perfect! Rent a boat and float under the bridges or venture off to Tavira Beach, which is mainly accessible by boat. It’s also well positioned for the breath-taking nature of Rio Formosa National Park.

Best for: Sightseeing, culture and romantic breaks

The best Tavira hotels

Luxury: AP Maria Nova Lounge Hotel
Moderate: Ozadi Tavira Hotel
Affordable: Quinta do Caracol


Where to stay in the Algarve - Colourful street in Olhão
Olhão marina and boats - Best places to stay in the Algarve

Just down the road from Tavira is Olhão. Although they’re similar in size, Olhão is even less touristic. It has a thriving local population, and a stay here very much feels like stepping into the shoes of a local. Stop by the indoor market for daily groceries, kick back in a quaint alleyway apartment rental and embrace the bustling seaside life of this fishing town. Olhão gives a good representation of what it’s like living in the Algarve full time and there’s always lots going on.

It’s a good place to stay if you’re visiting the Algarve out of season. As so many locals live here, restaurants are open year-round and it’s well stocked with amenities. The marina, promenade and old town are the key places to see, but there aren’t a great deal of tourist attractions for families.

Best for: A local Portuguese experience, boat trips, eating out

The best Olhão hotels

Moderate: Real Marina Hotel & Spa
Moderate: Hotel Cidade De Olhao
Affordable: Pensao Bicuar Residencial

Great places to stay in the Algarve for a few nights

If you’re like us and you enjoy sampling a couple of different hotels and areas to stay on holiday, the following destinations great places to stay in the Algarve are perfect for a few nights. Pick a base from the list above and combine it with one of these towns for the perfect multi-centre trip to the Algarve. You’ll get the best of both worlds!


Monchique town on the mountainside
The best Monchique hotels - Shows a colourful town street

Nestled deep within the mountains of the Algarve and faraway from the shore, sits the town of Monchique. The drive up through the mountains and onward to Monchique is an attraction in itself! Whilst we recommend it as a day-trip to anyone, it’s also a great place to stay for a few nights. Its ‘countryside’ appeal is much unlike the rest of the Algarve and you won’t find many tourists here at all. Cosy up in a small guesthouse or B&B and embrace the quiet life of the locals.

Cafes, long walks up to the mountain top and window shopping is the vibe during the day. Evenings are equally as low-key, with authentic local restaurants being the perfect place to sample Portuguese dishes; and we can’t forget the wine! Monchique is great for those that like to cycle or hike – the surrounding nature parks and hillsides have some incredible views.

Best for: A quiet and traditional experience, culture, hiking and the great outdoors

The best Monchique hotels

Luxury: Monchique Resort & Spa
Moderate: Vilafoia
Affordable: Inn Albergeria Bica-Boa


Best places to stay in the Algarve - Praia do Beliche beach view
A view from Sagres Lighthouse - The best Sagres hotels

Located to the very far west of the Algarve, on the edge of Europe (literally), Sagres is a rugged coastline of impressive cliffsides, beaches and several popular sights. It also has a small town. Many visitors to Sagres stay in town, which is full of surf shops, bars and restaurants. They then spend their days exploring the coastline. The aggressive waves have carved some spectacular scenery from the landscape and it’s a surfer’s paradise for those that are a fan of the sport.

Visit Sagres Fortress, gaze out at the Atlantic from Sagres Lighthouse or venture north, up the Costa Vincentina coastline. You can opt to stay in a small hostel, boutique hotel or apartment in town, or set up a tent in one of the outdoor camping spots that line the coast. Sagres is the place to stay for the adventurous and 2 – 5 nights is a perfect amount of time.

Best for: Surfing, beaches, road trip adventures

The best Sagres hotels

Luxury: Martinhal Sagres Beach Resort & Hotel
Moderate: Sagres Time Apartamentos
Affordable: Casa Azul Sagres – Rooms & Apartments

That concludes our list of the best places to stay in the Algarve! With so many beaches, hotels and resort areas to choose from, it can be quite intimidating choosing a destination that appeals to you the most. Use our guide to get a feel of each location and do as much research as you can. No matter where you stay in the Algarve, you can visit all the attractions you desire within a short drive. We recommend renting a car if you plan on doing lots of exploring.

Finally, please remember to check the reviews for your chose hotel on Tripadvisor before booking. If you have any questions about any of the places we’ve mentioned or hotels we recommended, comment below and we’ll respond as soon as we can. 😊


Author bio:

An adventurer at heart that loves anything outdoors. Beaches, mountains and amazing scenery is everything I love about travel! I also enjoy home comforts and need a nice place to relax and re-charge after every trip.

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