Where to Stay in Madeira: Perfect Areas For Every Budget

Picking a place to stay in Madeira requires extra planning compared to other European trips. This island isn’t your typical tourist hotspot. 

Located about 1,000 kilometers from mainland Portugal in the Atlantic Ocean, this mountainous archipelago charms visitors with its dramatic landscapes and diverse attractions.

The best time to visit is between May and September. Since Madeira stays busy most of the year, you’ll want to book your stay well ahead of time.

You should plan to spend at least a week here to really see what Madeira has to offer. If you’re staying longer than seven days, it’s smart to split your time between the north and south parts of the island.

Your choice of location will substantially affect your island experience. Let’s take a closer look at Madeira’s best places to stay based on your transport needs, activities, and budget.

I’ll help you find the right spot for your Madeiran adventure, whether you want a hiking base, a romantic town, a family resort, or budget-friendly options.

Disclaimer: This post may contain affiliate links, meaning I receive commissions for purchases made through those links at no cost to you. Please read my full disclosure for more information.

Where to Stay in Madeira Without a Car

You don’t need a car to enjoy Madeira—it’s a great way to experience the island’s charm at your own pace. The island has well-connected public transport and pedestrian-friendly towns. You’ll find the island’s natural beauty without the stress of driving on mountain roads.

Top towns with good public transport

Funchal is the transportation hub of Madeira and makes a perfect base if you’re traveling without a car. The city’s bus connections through Horários do Funchal reach the capital, its suburbs, and popular attractions the Botanical Garden and Pico dos Barcelos. 

The modernized SIGA network has made things even better since July 2024, with comfortable, eco-friendly buses that reach every corner of the island.

Busses run by Companhia de Autocarros da Madeira (formerly SAM) take you to eastern spots like Caniço, Santa Cruz, Madeira Airport, Machico, and Porto da Cruz. Siga Rodoeste services help you reach western destinations like Câmara de Lobos, Ribeira Brava, or Porto Moniz.

Machico makes another great transportation base, especially if you want to see eastern Madeira. The former capital is located close to Madeira Airport and has direct buses to Funchal and other eastern parts of the island. You can reach amazing hiking spots like Ponta de São Lourenço for just €1.95.

Caniço and Santa Cruz have reliable public transport too. Regular connections to Funchal and the airport make these towns practical choices if you want quieter alternatives to the capital.

Best areas for walkability and tours

Funchal’s Old Town ranks as Madeira’s most walkable area, with its pedestrian zones, beautiful old buildings, and cobblestone streets. You can explore the entire city center on foot, and eco-friendly electric minibuses (Linha Eco Cidade O5A) help when you need a break from walking.

The Lido area in western Funchal links to the city center through a beautiful coastal promenade. This seaside walk features plenty of restaurants and hotels along the way. A spot within 500m of the Funchal Cathedral puts you close to most bus departures and the Monte cable car.

Tour accessibility makes Funchal an ideal base. Most organized excursions start here, so you can easily join whale watching trips, levada walks, or hop-on hop-off bus tours without your own transport. 

Madeira’s famous levadas (irrigation channels) create relatively flat hiking trails across the island—”water doesn’t like to travel uphill”. Public buses can take you to trailheads for many popular levada walks, which means you can go hiking without a car.

Recommended stays in Funchal and Machico

A stay in Funchal or Machico without a car lets you see Madeira’s beauty through affordable public transport, organized tours, and pleasant walks. It’s often more relaxing than trying to navigate the island’s challenging roads yourself.

Where to Stay in Funchal

Funchal’s city center has some great places to stay. 

The Three House Hotel features modern rooms with a rooftop pool and bar, all within walking distance of the old town and seafront. Santa Maria Hostel makes a great choice for budget travelers.

Central Funchal apartments like Atlantic Studios and Endemic – Concept Apartments put you in a perfect spot to explore on foot and use public transport. 

Sé Boutique Hotel offers something special—stylish rooms in Funchal’s heart with creative décor and a rooftop bar that shows off city views.

Where to Stay in Machico

Machico has the White Waters Hotel, a comfortable 3-star option with a terrace, restaurant, and bar. 

The Dom Pedro Madeira gives you an all-inclusive experience with an oceanfront location and direct beach access—perfect when you want to relax without traveling far.

Budget travelers in Machico can check out Residencial Familia with its super clean rooms at good rates. The Modern & Recycled Guest House gives you well-equipped kitchens just minutes from the beach.

Where to Stay in Madeira With a Car

A rental car gives you exceptional freedom to find the island’s hidden gems and remote corners that many visitors miss in Madeira. The island’s steep mountain roads and coastal drives with stunning views become yours to explore, and this completely changes your Madeiran adventure.

Freedom to explore remote areas

Spending a little extra on a rental car is often worth it in Madeira, especially if you want to see beyond the main towns.

Having your own wheels makes it easy to reach quiet beaches, dramatic viewpoints, and trailheads that public transport simply doesn’t serve. You can pull over whenever something catches your eye, whether that’s a waterfall, a coastal lookout, or a winding mountain road begging for photos.

Even though Madeira appears compact, getting from one side of the island to the other can take around an hour and a half, tunnels included.

If you’re staying longer than a few days, that flexibility becomes a huge bonus. You can slow the pace, explore different corners of the island, and really take in Madeira’s variety without feeling like you’re constantly racing the clock.

Best towns for road trippers

Porto Moniz works great as a base to explore Madeira’s northwestern region. This charming town, known for its volcanic rock pools, becomes peaceful once day-trippers leave. You’ll be in the perfect spot to explore the western half while enjoying quiet evenings away from Funchal’s energy.

Calheta in the southwest lets you mix beach time with countryside adventures. Families love this spot for its rare sandy beach. The location puts you close to many popular walking trails in western Madeira.

Ponta do Sol, Madeira’s sunniest town, sits beautifully between plantation-covered cliffs. Couples looking for romance after a day of exploring will love its laid-back evening atmosphere.

Ribeira Brava stands where the south coast road meets the central route through the island’s middle. This peaceful town, with its pebble beach and beautiful church, makes a perfect base to explore the entire island.

Porto da Cruz on the north coast gives hikers a quiet retreat to explore the wild countryside and remote trails.

Parking and driving tips

Madeira’s roads need some preparation and patience to navigate. Look for accommodation with private parking because street parking can be tough, especially in Funchal. Your host should tell you about parking options if they’re not listed.

Funchal offers these parking spots:

• Almirante Reis Car Park (equipped with electric car chargers)
• Plaza Madeira (formerly La Vie Funchal) in a shopping mall
• São Tiago Parking near the historic areas
• Amazonia Car Park near the city center

Street parking has specific rules. White lines mean free parking, blue lines show paid areas (usually €2-€4 per hour), and yellow lines indicate no parking. Don’t park in spaces with a white “M” – these belong to residents only, and you might get fined or towed.

Pick your accommodation wisely and prepare for Madeira’s unique driving conditions. You’ll see parts of the island that most tourists never do.

Best Places to Stay in Madeira for Hiking

Madeira’s stunning landscapes and network of trails make it a hiker’s dream. The right place to stay can make all the difference in getting the most from your mountain adventures.

Top hiking trails and nearby towns

The island boasts a well-laid-out hiking network with trails marked in the PR (Percurso Recomendado) system. This makes finding and following routes a breeze throughout the island.

Several trails stand out as must-do adventures:

• PR1 – Vereda do Areeiro – Many rank this 7-hour trek between two of Madeira’s highest peaks among the world’s most spectacular day hikes
• PR8 – Vereda da Ponta de São Lourenço – A gentle coastal trail along the eastern peninsula with stunning Atlantic views
• PR9 – Levada do Caldeirão Verde – A favorite forest and waterfall trail in the northwest region
• PR6 – 25 Fontes – A popular waterfall trek in the Rabaçal area
• PR11 – Vereda dos Balcões – An easy 3km round-trip forest walk leads to a breathtaking viewpoint

Starting January 2026, you’ll need advance reservations through the SIMplifica portal to access Madeira’s classified trails. The fees run €4.50 for the general public and €3 for visitors with tourism company guides. This makes staying close to your favorite trailheads even more valuable.

Early morning starts work best for popular trails. The biggest parking lots at spots like Dragon’s Tail and Pico a Pico fill up by 7 AM.

Best bases: São Vicente, Santana, Faia

São Vicente

If hiking is high on your Madeira wish list, São Vicente makes an inspiring place to base yourself. Staying here puts you right on the edge of the island’s lush interior, where ancient laurel forests stretch into the mountains and quiet trails begin just minutes from town.

From this north coast setting, you can easily mix coastal walks with deep forest hikes. And when you feel like exploring elsewhere, a scenic drive through Ribeira Brava links you to the south side of the island in about half an hour, opening up even more routes to discover.

Santana

Santana offers a completely different but equally memorable experience. You’ll instantly recognize it by its storybook-style houses with steep thatched roofs, which give the town a strong sense of place.

As a hiking base, it’s hard to beat. From here, you’re close to well-known trail gateways like Queimadas and Achada do Teixeira, making it easy to reach high mountain paths and classic levada walks.

You’ll also appreciate the convenience of having a large supermarket nearby, ideal for stocking up before a full day on the trails.

Faial

For a quieter, more local feel, Faial invites you to slow down and connect with Madeira’s raw beauty. Tucked beneath the dramatic Penha d’Águia rock formation, this small village feels refreshingly untouched.

Staying here gives you access to coastal and mountain routes, including long-distance trails and scenic paths around Santana. Early mornings are especially magical, when you can catch sunrise views from nearby viewpoints before the island fully wakes up.

If you’re craving nature, calm, and an authentic Madeiran atmosphere, Faial is a place you’ll truly appreciate!

Recommended hiking lodges and guesthouses

Madeira’s hiking regions offer some fantastic places to stay that cater specifically to hikers’ needs.

São Vicente’s Solar da Bica provides a peaceful retreat with mountain views, a heated saltwater pool, and sauna – perfect after a long hike. Their homemade breakfast features local specialties that fuel your hiking day. The property can set up activities like canyoning, climbing, and birdwatching when you ask.

Near Santana, Quinta do Furão gets rave reviews for its spectacular coastal and mountain views. Budget-conscious hikers will appreciate Casa de Campo do Pomar B&B, which offers comfortable rooms and homemade breakfast in a beautiful setting.

The Faial area features Hikers Haven, a roomy three-bedroom villa with its own pool, sun terrace, and garden. Groups or families will find it a comfortable base near the trails. Casa dos Anjos offers simple rooms in a rural mountain setting that’s ideal for hikers and those seeking to escape city life.

Unique spots like Refúgio das Camélias dot the island, promising stays where you’ll wake up to breathtaking mountain views with popular hikes just 20 minutes away.

Your choice of accommodation location really matters in Madeira’s mountainous terrain. Staying close to your favorite trails means less time driving and more time hiking – exactly what outdoor enthusiasts want from their Madeiran adventure.

Where to Stay in Madeira for Couples

Madeira’s dramatic cliffs and ocean views create a perfect backdrop for couples who want romance and privacy. The island combines a subtropical climate with lush landscapes and magical sunsets to create a paradise for honeymooners and couples who need time together.

Romantic towns with scenic views

The island is filled with romantic spots that offer amazing views and create lasting memories. 

You can walk through the vibrant Monte Palace Tropical Garden, where green surroundings set the stage for intimate walks. The steep cliffs above the Atlantic, especially at Cabo Girão, create spectacular settings for special moments.

Couples can watch incredible sunrises and sunsets from spots like Pico do Arieiro. The natural volcanic pools at Porto Moniz let you relax together, surrounded by beautiful landscapes. The sunset spots where sky meets sea in warm colors create perfect moments to share.

Top picks: Ponta do Sol, Seixal, Jardim do Mar

Ponta do Sol is one of Madeira’s most romantic spots. True to its name (“Sun Point”), this charming village is the sunniest place on the island. The town center is small but delightful, with colorful buildings nestled among steep green cliffs. The waterfront looks amazing at sunset and makes evening walks special. Couples can explore cobbled streets that lead to outdoor cafés and boutiques.

Seixal draws visitors with its natural beauty and peaceful atmosphere. This lovely town near Porto Moniz has natural lava rock pools and a beautiful black sand beach. The church against the backdrop of north coast cliffs creates stunning views. 

Jardim do Mar, which means “Garden of the Sea,” wows visitors with its maze of colorful houses and cobblestone alleys. This village has one of Madeira’s most beautiful seafront walks, completely free from cars, making it ideal for romantic strolls. This coastal gem shows off stunning cliffs that meet the ocean.

Best boutique and adults-only stays

Couples seeking unique places to stay will find excellent options in Madeira. The 1905 Zino’s Palace in Ponta do Sol offers a unique experience with its eye-catching pink facade and black shutters. This hillside boutique hotel has sweeping ocean views, an intimate feel, and a cozy terrace that’s perfect for sunset watching.

Estalagem da Ponta do Sol stands out among Madeira’s adults-only hotels. This updated former estate sits dramatically on a cliff and blends traditional charm with modern design. Guests enjoy elegant rooms with private sea-view balconies, a panoramic infinity pool, and a spa with a heated indoor pool.

Yeotown Health Retreat Hotel in Arco da Calheta is perfect for couples who want wellness-focused stays. The peaceful retreat offers comfortable chalets with views of nature and ocean. Couples can enjoy yoga and meditation together in this serene setting.

Madeira has many places designed for romantic getaways, from historic estates to clifftop hotels. Many rooms come with infinity pools facing the Atlantic, luxury spas, and private balconies where you can watch Madeira’s famous sunsets. The island’s exclusive accommodations deliver excellent service and romantic atmosphere, whether you stay by the sea or in nature.

Where to Stay in Madeira with Kids

Planning a trip to Madeira with kids? You’ll need to choose your accommodation carefully. The island’s family-friendly areas have great beaches, fun activities, and places to stay that cater to young travelers.

Family-friendly beaches and activities

Beach quality becomes crucial if you’re vacationing with kids in Madeira. The island’s coastline is mostly rocky, so sandy beaches are precious finds for families.

Machico Beach on the east coast combines golden imported sand with natural pebbled areas. Its calm waters stay protected by breakwaters – perfect for young swimmers. The sheltered bay keeps waves gentle, so children can play safely in the shallows.

Calheta Beach on the southwest coast shines as another great spot. This man-made beach uses imported Moroccan golden sand and has shallow waters that kids love. You’ll find restaurants with child-friendly menus along the promenade and shaded spots to rest between swimming sessions.

Many places to stay go beyond just beaches. The Views Oásis Hotel in Caniço, to name just one example, has a playground complete with trampoline, swing sets, and free pedal carts for kids to ride on the boardwalk. The hotel’s daily children’s activities are worth checking out, from themed events to movie nights.

Top picks: Calheta, Machico

Calheta stands out as a family favorite in Madeira. This beautiful area has one of the island’s rare sandy beaches where high wave breakers create calm, swimmable waters – a safe haven for kids at play.

Families can choose from excellent self-catering villas with ocean views. Supermarkets and pharmacies sit right across from the main accommodation areas.

Madeira’s former capital, Machico, gives families a developed yet laid-back vibe. Its beautiful sandy beach ranks among the island’s most kid-friendly spots. Parents love the secured playground overlooking the shore – it keeps children entertained easily.

Dom Pedro Madeira proves to be an excellent family choice, with guests noting an “easy walk into town so easy access to good restaurants and a great gelato shop!”

Best resorts and apartments for families

The Calheta Beach Hotel runs a fantastic kids’ club with engaging activities and staff who connect well with children. Family suites are spacious with separate bathrooms. The hotel is also conveniently located right across from a supermarket and pharmacy.

Luxury-seeking families will love Reid’s Palace, one of Madeira’s finest hotels. This historic property offers interconnecting rooms or spacious suites for families, and provides each child with their own teddy bear. Kids feel welcome in this upscale setting thanks to an excellent kids club and amazing pools.

Apartment rentals work great for families who need more space:

• “Beatriz’s little house” in Santana is a rebuilt typical Madeiran house with sea and mountain views.
• “Mango House” in Arco Da Calheta comes with two bedrooms, a full bathroom, and an open-concept living area. It also has a garden, barbecue, and mini-pool.

Looking for something unique? Try glamping at the “Papaia Yurt” in Ponta do Sol. Kids wake up in a lush permaculture garden with a natural pool and stunning views of the sea and waterfall.

Best Budget-Friendly Areas to Stay in Madeira

You can find budget-friendly places to stay in Madeira that give you great locations and experiences. The island has many affordable options in different towns that balance value with comfort.

Affordable towns with good amenities

Smart budget travelers know location matters in Madeira. A well-connected area helps you save money on getting around and gives you easy access to what you need. The south coast’s reliable public transport makes it an ideal choice for budget-conscious travelers.

Funchal serves as the island’s capital and budget travelers’ paradise. You’ll find major supermarkets and local markets within walking distance – perfect if you want to cook your own meals. The city houses 90% of the island’s population and serves as a hub for affordable restaurants, services, and tour connections.

The towns beyond Funchal give you lower prices and good facilities. These spots keep you connected to major attractions while letting you experience authentic island life away from tourist hotspots.

Top picks: Machico, Caniço, Faial

Machico stands out as Madeira’s best value town, especially when you have short stays planned. This former capital boasts a rare sandy beach that budget travelers love. Places like Residencial Familia give you spotless rooms at wallet-friendly rates, and guests rave about the value they get.

Caniço costs less than Funchal and mixes local charm with resort amenities. Its location just east of the capital means easy transport links at better prices. Inn & Art Madeira offers a unique cliffside stay with amazing sea views that won’t break the bank. Royal Orchid Hotel ranks among the area’s best deals.

Faial, a peaceful northern village, lets you experience real island life at amazing prices. Rooms start at £22 per night, making it an excellent choice if you have a car. The village rewards you with beautiful views, great hiking trails, and a genuine Madeiran atmosphere away from crowds.

Budget hotels and guesthouses

Madeira offers several budget-friendly places to stay:

Pensões and Residencials are Madeira’s classic budget options. Look for “Pensão Funchal” or “Residencial Funchal” instead of “hotel” to find substantially better rates. Valhalla Panorama and Residencial Vila Lusitania are great choices.

Modern hostels have popped up as younger travelers discover Madeira. Jaca Hostel offers hostels in Funchal and Porto da Cruz, with both offering dorms and private rooms. Modern & Recycled Guest House in Machico combines eco-friendly design with a prime location near the beach.

Budget apartments are also a great way to get more value, especially for longer visits. Gate15 in Machico gives you stylish, well-equipped spaces that often outshine 5-star hotels at reasonable prices. Atlantic Dream Alto Mar in Caniço offers modern apartments with ocean views that won’t empty your wallet.

January brings the best deals, with hotel rates in Machico dropping up to 68% compared to peak season.

Where to Stay in Madeira for Beaches and Relaxation

Beach enthusiasts heading to Madeira need to plan carefully due to the island’s volcanic origins and few sandy beaches. The good news is that several spots cater to sun-seekers and those who want to unwind.

Best beach towns: Calheta, Porto Santo

Calheta

Calheta stands out as Madeira’s best beach, with one of the island’s rare golden sand beaches. This man-made wonder came to life with sand from Morocco’s Sahara Desert and spans 100 meters.

The beach’s two protective breakwaters keep the waters peaceful and safe for swimmers. You’ll find a recreational harbor, restaurants, and essential facilities like changing rooms and first-aid stations right by the beach.

Porto Santo

Porto Santo, a separate island in the Madeira archipelago, gives visitors a different experience. This gem boasts a natural 9-kilometer golden sand beach that can help heal rheumatic and orthopedic conditions. 

Manmade vs. natural beaches

Madeira’s main island has two man-made golden sand beaches—Calheta and Machico—created with Saharan sand. 

The natural beaches tell a different story, like Seixal Beach with its dramatic black volcanic sand and mountain backdrop.

Nature lovers can enjoy spectacular lava rock pools at Porto Moniz and Seixal. These spots blend beach relaxation with Madeira’s volcanic character.

Top beach resorts and villas

Calheta Beach Hotel lets guests step right onto Calheta’s golden sands. This resort has three restaurants, three bars, indoor and outdoor pools, and a spa.

Funchal Seaside Villas gives guests oceanfront living in Funchal’s historic waterfront. The four-bedroom “Islander” villa also offers a private pool.

Porto Santo’s Pestana Porto Santo Beach Resort & Spa and Vila Baleira Hotel Resort & Thalasso Spa rank as guest favorites. Both properties give direct beach access and top-notch amenities.

Best Luxury and Boutique Hotels in Madeira

Madeira’s luxury hotels combine historic charm with modern design. Guests can find exceptional stays throughout the island.

Top-rated 4 and 5-star hotels

Reid’s Palace, A Belmond Hotel is Madeira’s crown jewel of luxury stays. The historic property sits on a cliff with Atlantic Ocean views, beautiful tropical gardens, three pools, and ocean access. Each room showcases elegant touches with crisp embroidered bedspreads and classic wicker chairs. The hotel’s afternoon tea has become an island tradition with delicious home-baked treats.

Quinta do Furão ranks among the best four-star properties on the island. The hotel amazes guests with its north-east coastal views and mountain backdrop. The property’s indoor and outdoor pools, along with its excellent breakfast, consistently earn high praise from visitors.

The Reserve at Savoy Palace creates an intimate boutique feel within a grand hotel setting. This exclusive section has 44 rooms, its own entrance, and special access to the Jacaranda restaurant and rooftop infinity pool.

Saccharum Resort & Spa in Estreito da Calheta draws inspiration from the island’s sugar cane roots. This five-star property stands out with its rooftop infinity pool and sweeping ocean views.

Unique boutique experiences

Quinta da Casa Branca welcomes guests to a special luxury stay amid vast gardens and a banana plantation. This small luxury hotel pairs boutique comfort with manor house elegance.

Castanheiro Boutique Hotel leads Madeira’s boutique scene. Located in Funchal’s historic heart, it mixes restored architecture with modern style. This hotel is conveniently located minutes from Funchal’s cobbled streets yet maintains a peaceful atmosphere.

The Vine Hotel brings modern five-star luxury with its award-winning design, panoramic pool, and city views. The hotel’s spa includes a fitness center at no extra cost.

Three House Hotel takes pride in its personal touch. Guests wake up to fresh pastries on their doorstep each morning and can enjoy Funchal views from the rooftop.

Key Takeaways on Where to Stay in Madeira

Planning your Madeira accommodation strategically can make or break your island experience, whether you’re seeking adventure, romance, or relaxation.

• Choose your base by transport method: Stay in Funchal or Machico for car-free travel with excellent public transport, or pick Porto Moniz, Calheta, or Ponta do Sol with a rental car for remote exploration.
• Match location to your activities: Hikers should base in São Vicente, Santana, or Faial for trail access; couples prefer romantic Ponta do Sol or Seixal; families thrive in beach towns like Calheta and Machico.
• Budget travelers have great options: Machico, Caniço, and Faial offer excellent value with good amenities, while pensões and residencials provide authentic stays at lower costs than traditional hotels.
• Book early and consider split stays: Madeira stays popular year-round, so advance booking is essential. For week-long visits, split between north and south regions to maximize your experience.
• Beach lovers need specific planning: With limited sandy beaches, prioritize Calheta’s imported golden sand or Porto Santo’s natural 9km stretch for the best beach relaxation experience.

The key to a perfect Madeira stay lies in aligning your accommodation choice with your travel style, budget, and planned activities—from hiking bases to romantic retreats to family-friendly beach towns.

RELATED BLOG POSTS:

• Best Things to do in Madeira, Portugal
• Cheapest Time to Travel to Madeira
• Madeira Solo Travel
• Funchal Travel Guide