When you think of heading off to Portugal you might be thinking of Lisbon and Lisbon only. But I’m here to let you in on a little secret, the mystical and magical Portuguese paradise that is Faro. No matter how hard I tried, I just couldn’t work in an abracadabra…
Faro is the capital of the DAZZLING Algarve region in Southern Portugal and overall, is a pretty unrated town. There are no swarms of tourists taking up every good spot on the beach, nor crowding the interesting Faro sites like the Bone Chapel.
Lisbon is incredible, we’re not hating on Lisbon. But there is something about Faro that just takes our breath away.
But not all areas in Faro are made equal and they are quite spread out. There are gorgeous beaches in Faro but they aren’t close to the town. So, you’ll want to know which area in Faro is best for you and your travel desires!
Lucky for you (and me), I have explored this enchanting city and have written this guide on where to stay in Faro to help you figure out where will be best for you. Whether you’re up for exploring the Old Town or sunbathing on the golden sand beaches – Faro has it all.
Keep scrollin’ and I’ll take you through everything I know!
In a super big rush to find the perfect place to stay in Faro? Look no further. These are our highest recommendations for Faro accommodation.
The Broke Backpacker is supported by you. Clicking through our links may earn us a small affiliate commission, and that's what allows us to keep producing free content 🙂 Learn more.
Faro Cosy Guest House | Best Hotel in Faro
Faro Cosy Guest House is conveniently located in downtown Faro and was recently renovated. The rooms are very affordable, and the rooms live up to the hotel’s name: cosy indeed! Enjoy all that Faro has to offer from a clean, comfortable room that usually costs less than $50 a night. Awesome, right?
Luxury apartment with great value | Best Airbnb in Faro
With hotspots around every corner, this is definitely the right place you want to stay at when visiting Faro for the first time. If you’re unsure about what to do or see during the day, reach out to your host and she’ll provide you with great recommendations. The Airbnb is cosy and welcoming, with big windows and bright rooms – definitely a great home.
Casa d’Alagoa | Best Hostel in Faro
Casa d’Alagoa is our top choice for hostels in Faro. It’s perfect location paired with its unparalleled hospitality makes it a Porteguese gem. We love the shared spaces that guests can use: a kitchen, dining room, and nice outdoor space. And this Faro hostel is built inside a historical building which adds a double wow factor!
Need to spend some quality time with fellow backpackers? Get your fix by staying at one of these amazing hostels in Faro!
Marina de Faro
If you’re curious as to where to stay in Faro for your first time our answer is definitely the Marina de Faro! It is the part of town is home to Faro’s Marina that faces the beautiful Ria Formosa.
Cidade Velha
The Cidade Velha translates simply to Old Town in English. The Cidade Velha is the historical center of Faro. It is surrounded by 9th century walls from the Moorish occupation.
Downtown Faro
Alright, are you wondering where to stay in Faro for nightlife or where to stay in Faro for one night? The answer is definitely Downtown Faro. Faro’s downtown is the most popular place for tourists to visit and stay in Faro.
Ilha de Faro
Isn’t it wild that the ocean and the lagoon of Ria Formosa are only 10 meters apart from each other in some parts? Faro isn’t technically even a beach resort city, since there are actually no beaches within walking distances of the center of the city.
Montenegro
Montenegro is the perfect place to stay with kids in Faro. Why is Montenegro recommended as where to stay in Faro with kids? Montenegro is a suburb of Faro that promises guests a more peaceful and restful stay in Faro.
Faro is the capital and best place to stay in the famous Algarve region in southern Portugal. Is it weird that I wanted to call the Algarve region delicious? It has approximately 118,000 city dwellers, which makes it the biggest city in the Algarve. For those of us out there who have visited big cities like London or Prague, you might think 118,000 is not that big at all.
Sounds quaint and cozy in comparison, right? Well, this wonderful metropolitan city also has exquisite island beaches, and plenty of fun things to do and see. Let’s figure out which part of Faro is the best neighborhood to stay in for you!
Want to save money on accommodation?
We got you. For reals.
Faro’s 5 Best Neighborhoods to Stay in
Ready to rumble? Let’s dig into the best neighborhoods to stay in Faro!
#1 Marina de Faro – Where to Stay in Faro for the First Time
If you’re curious as to where to stay in Faro for your first time our answer is definitely the Marina de Faro! It is the part of town is home to Faro’s Marina that faces the beautiful Ria Formosa. Most hotels offer views of the fishermen boats below or those stunning summer yachts.
The Marina de Faro area is filled with lots of outdoor activities that you will love. In the summer, there are free performances and music concerts outside that make for a perfect evening.
Delicious seafood restaurants abound here, featuring the catch of the day! While the hotels here might be a bit of a splurge, Marina de Faro is the perfect place to stay in Faro for first timers.
Eva Senses Hotel | Best Hotel in Marina de Faro
Eva Senses Hotel is one of the grandest and nicest hotels in Faro. It is situated right on the marina itself, so it offers guests gorgeous seaside views. It’s a 4-star hotel, so you can expect a little pampering to happen. Make sure to take advantage of the complimentary breakfast and the outdoor pool.
Hotel Faro and Beach Club | Best Hotel in Marina de Faro
Hotel Faro is a dazzling 4-star hotel right off the marina. It has 90 rooms and 4 meeting rooms, and offers spa services. Therefore, it caters to those who want the princess treatment. The rooftop pool and bar and lounge are also luxurious – soak up the glam life at Hotel Faro!
Luxury apartment with great value | Best Airbnb in Marina de Faro
With hotspots around every corner, this is definitely the right place you want to stay at when visiting Faro for the first time. If you’re unsure about what to do or see during the day, reach out to your host and she’ll provide you with great recommendations. The Airbnb is cosy and welcoming, with big windows and bright rooms – definitely a great home.
Tilia Hostel | Best Hostel in Marina de Faro
If you’re travelling in Faro and looking for a buzzing hostel in the heart of the action, look no further my friend. Tilia Hostel is a snazzy hostel with funky chill-out spaces, a communal kitchen, and beds that are far too comfy for a hostel. You have everything you need within walking distance of public transport, cafes, bars and delicious restaurants. A great place to perch up and enjoy what Faro has to offer.
Things to Do and See in Marina de Faro
- Catch a free performance or music concerts outside during the summer months
- Walk around the marina and take turns pointing out which boat is your dream boat
- Cruise along the waters on a boat tour and keep your eyes peeled for the abundant bird life
- Visit Faro’s Maritime Museum and see the curious exhibits about Portugal’s Age of Discovery
- Snap a photo of the “Heart Faro” sign on the boardwalk
- Enjoy seafood at a waterside cafe like Marisqueira Faro e Benfica
We’ve tested countless backpacks over the years, but there’s one that has always been the best and remains the best buy for adventurers: the broke backpacker-approved Osprey Aether and Ariel series.
Want more deetz on why these packs are so damn perfect? Then read our comprehensive review for the inside scoop!
View on Osprey View on REI#2 Cidade Velha – Where to Stay in Faro on a Budget
The Cidade Velha translates simply to Old Town in English. The Cidade Velha is the historical center of Faro. It is surrounded by 9th century walls from the Moorish occupation.
Believe it or not, Cidade Velha is where to stay in Faro on a budget! There are lots of hostel options near Old Town, which are usually housed in beautiful historic buildings.
It is a treat to stay in Cidade Velha, as every street you walk down has an air of Portugal to it. There’s none of the bustling city vibes here. It’s pure Portugese charm.
Sunlight House | Best Hotel in Cidade Velha
The Sunlight House is a charming bed and breakfast that is known for having super friendly staff, and beautiful rooms. Breakfast is included, which makes your stay in Faro even easier for those night owls out there! There is also a communal kitchen if you want to prepare your own meals.
My Place @ Faro Duplex | Best Rental in Cidade Velha
Wonderful apartment available for rent that comes with all the typical household amenities. It is a one bedroom apartment that has a balcony that offers seaside views! It’s the perfect spot for those who are looking to snuggle up in clean and cozy apartment.
Casa d’Alagoa | Best Hostel in Cidade Velha
Casa d’Alagoa is perfectly located just outside of the old town’s fortified walls. It is directly across from some delicious restaurants too, so you don’t have to wander far to find a good bite to eat! Casa d’Alagoa has a warm, welcoming atmosphere and is a hotspot for young tourists to flock to!
Cute private room in house | Best Airbnb in Cidade Velha
Better reviews are almost impossible. This very popular and very affordable room, which is located in the city centre, is a real gem. Spacious, nicely designed and with your own bathroom, you’ll find everything you need. Free Netflix is also available. Shared spaces like the living area, kitchen and patio are great for spending the day if you don’t want to go outside.
Things to See and Do in Cidade Velha
- Snap a photo with the statue of Faro’s patron saint, Saint Thomas Aquinas.
- Spot the local stork nests on top of street lamps
- Stop by the Gothic Cathedral for a quick photo op
- Visit the Galeria do Trem (Rua do Trem) which showcases the works of contemporary Portuguese and foreign artists alike!
- Take a tour of the Bishop’s palace
- Get lost along the beautiful cobblestoned streets, windowshop and enjoy the scenic Porteugese streets
- Eat traditional Portugese classics at Faz Gostos, make sure to try the xarém (maize porridge)
#3 Downtown Faro – Best Area to Stay in Faro for Nightlife
Alright, are you wondering where to stay in Faro for nightlife or where to stay in Faro for one night? The answer is definitely Downtown Faro. Faro’s downtown is the most popular place for tourists to visit and stay in Faro.
While it is a metropolitan area, Downtown Faro isn’t one hundred percent modern. The streets are paved in the traditional Portuguese ‘calçada’ style, which are tiny pieces of stones arranged to form a pattern or image, just like a streetside mosaic.
Downtown Faro is covered in these beautiful street-mosaics that make a stroll through downtown even cooler.
Downtown has some of the best shops, restaurants, bars, and stores to check out that you certainly shouldn’t miss if you’re staying in Faro for just one night! If you’re looking for a night out on the top, with dancing, music, or maybe just a beer, Downtown Faro is the place to be.
Faro Cosy Guest House | Best Hotel in Downtown Faro
Recently renovated guest house that promises guests a clean, cosy stay! Faro Cosy Guest House has modern vibes and affordable prices, with rooms usually costing around $50 per night or less!
Guest House São Filipe | Best Hotel in Downtown Faro
Guest House São Filipe is a quaint guest house that only has 11 rooms. It’s small size keeps things quaint and comfortable for guests. The rooftop terrace is an added bonus with their lounge chairs and even one of those swinging couch-chair things we all love so much but never know exactly what to call it.
Hostellicious | Best Hostel in Downtown Faro
You wish your bathroom was as clean as Hostellicious’ bathrooms! You won’t be disappointed with the cleanliness, nor with the sweet downtown location of Hostellicious hostel. With many different options for dormitories and budget friendly prices, it’s hard to go wrong with Hostellicious!
Stylish loft with cute beach vibe | Best Airbnb in Downtown Faro
This loft is super stylish and bright. The kitchen is new, living room and bedroom are incredibly comfortable, and the whole place just feels like a proper home. Located right in the middle of Downtown, you’ll be super close to bars and restaurants. Cool bonus: you can watch sunset and sunrise from your private roof terrace.
Things to See and Do in Downtown Faro
- Stroll the beautiful ‘calçada’ style streets and snap as many photos as you can of the intricate designs
- Enjoy a delicious coffee at Café Aliança, which is revered as the third oldest café in all of Portugal
- Visit the Igreja do Carmo, also called the Bone Chapel, which is known for being built out of the bones and skulls of monks!
- Eat a croissant at Pastelaria Gardy, which arguably makes the best croissants in the entire country
- Head over to Anchor Bar to enjoy a delicious cocktail
- Dance the night away at Prestige Dance Club
- Catch a cabaret show at the Dancing Cabaret Music Hall
A new country, a new contract, a new piece of plastic – booooring. Instead, buy an eSIM!
Jetpac eSIMs work just like an app: you download it, pick your plan, and BOOM! You’re connected the minute you land. It’s that easy.
Read about how e-Sims work or click below to see one of the top eSIM providers on the market and ditch the plastic.
Grab an eSIM!#4 Ilha de Faro – Coolest Place to Stay in Faro
Isn’t it wild that the ocean and the lagoon of Ria Formosa are only 10 meters apart from each other in some parts? Faro isn’t technically even a beach resort city, since there are actually no beaches within walking distances of the center of the city.
There are three sandbar islands that are a part of Faro, Ilha de Faro, Ilha da Culatra, and Ilha Deserta. These sandbars offer shelter to the Parque Natural da Ria Formosa. While all three islands are definitely worth visiting, the best place to stay in Ilha de Faro.
Ilha de Faro translates quite simply to Island of Faro. The Ilha de Faro has plentiful glorious golden sandy beaches with a whopping five kilometers of coastline! The beautiful beach is definitely a big reason why the Ilha de Faro is one of the best places to stay in Faro!
Visit the Praia de Faro for plenty of beach bars and chill cafes. Fun fact, it’s only a five minute drive to the airport from the Praia de Faro. Talk about convenient!
It’s actually known as a party beach and is touted as the busiest beach in the Algarve. There is a bridge that connects the Ilha de Faro to the mainland, and buses leave every 45 minutes. So even if you decide to stay on the Ilha de Faro, you won’t miss out on seeing the rest of Faro. Trust us, the Ilha de Faro is definitely one of the best areas in Faro to stay in.
Hotel Aeromar | Best Hotel in Ilha de Faro
Hotel Aeromar keeps prices friendly and rooms tidy. It’s not ostentatious by any means, but Hotel Aeromar keeps their 23 guest rooms snug, soft, and warm. It’s also a good spot for where to stay in Faro on a budget if you want to be beachside and not crammed in a dorm room.
Golden Beach Guest House & Rooftop Bar | Best Hotel in Ilha de Faro
Located steps away from the sand, Golden Beach Guest House is the perfect place to stay for beach bums or couples. Enjoy a rooftop terrace with incredible views, snazzy rooms with outrageously comfy beds and a walking distance from restaurants.
BLife Faro Beach Hostel | Best Hostel in Ilha de Faro
Right on the sandy shore, BLife Faro Beach Hostel couldn’t be in a better spot. This hostel has a stunning rooftop terrace perfect for grabbing a drink and watching the sunset. Enjoy the choice of mixed dorm rooms or a private room if you’re feeling fancy. You can get yourself a bed at a bargain on the golden sand of Ilha de Faro.
Beachfront house | Best Airbnb in Ilha de Faro
You can’t get much more beachfront than this Airbnb. Drift off to the sound of waves and wake up to beautiful ocean views as you sip your morning coffee. This snazzy Airbnb has three bedrooms, a fully equipped kitchen and a lovely outdoor area for some alfresco dining.
Things to See and Do in Ilha de Faro
- Relax on the beach with a book and catch some sun
- Try out surfing or kite surfing for those who are looking for a dose of adventure
- Feeling even more adventurous? There is a part of the beach where you can sunbathe naked on an unofficial nude beach — just walk east when you arrive
- Kayak down the Ria Formosa
- Enjoy a long walk along the beach on those soft, powdery, golden sands
- Watch the beautiful sunset after a picture perfect beach day
#5 Montenegro – Best Neighborhood in Faro for Families
Montenegro is the perfect place to stay with kids in Faro. Why is Montenegro recommended as where to stay in Faro with kids? Montenegro is a suburb of Faro that promises guests a more peaceful and restful stay in Faro.
If you happen to be traveling to Faro with a car and with the family, then staying in Montenegro is recommended by our travel experts as it much less busy and hectic than downtown. Take those ear plugs out and enjoy sleeping in this serene suburb.
There are lots of parks and green spaces in Montenegro, which is perfect for the picnic lovers out there. There is also lots of room to breathe and fun things to try from tennis to horseback riding. All the fun activities which pretty much answers the question of why Montenegro is where to stay in Faro for families.
Hospedaria Frangaria | Best Hotel in Montenegro
As a supremely great value hotel in Montenegro, the Hospedaria Frangaria is sure to delight. It is known for their wonderful breakfasts that offer guests lots of variety to choose from. The Hosperdaria Frangaria is conveniently located near the airport, and is both clean and quiet.
ibis Faro Algarve | Best Hotel in Montenegro
This budget friendly hotel that is situated close to the airport still offers guests a bit of peace and quiet. The ibis Faro Algarve has a lovely outdoor pool nestled in a garden setting which makes you feel tucked away from the city. There is plenty of free parking, and breakfast is available from 4am for those who need to catch an early flight!
Hotel Mónaco | Best Hotel in Montenegro
Free parking, free wifi, free buffet breakfast along with a giant outdoor pool— Hotel Mónaco has it all! This beautiful 4-star hotel has all the bells and whistles which makes for a perfect stay in Montenegro. The 24-hour health club is also an added bonus for those of us who want to clock in a little work-out on our holidays!
Family villa with free bikes | Best Airbnb in Montenegro
This Airbnb has amazing value, especially for bigger groups or families. The villa is located in calm Montenegro, with a couple of shops and restaurants around. The house is massive and absolutely loved by previous guests. The host provides bikes which can be used freely. You should definitely check out the new bike path that gets you right to the city centre. This villa in Faro is the perfect spot for families.
Things to See and Do in Montenegro
- Head on over to the tennis club for a round of tennis
- Enjoy a true Portuguese meal at O Bandiera, make sure to taste the chocolate mousse
- Go horseback riding at Centro Hípico Equinostrum
- Catch a live performance at Teatro das Figuras, a gorgeous modern facility that brings live shows to life
- Enjoy a stroll at Parque Ribeirinho de Faro
Stash your cash safely with this money belt. It will keep your valuables safely concealed, no matter where you go.
It looks exactly like a normal belt except for a SECRET interior pocket perfectly designed to hide a wad of cash, a passport photocopy or anything else you may wish to hide. Never get caught with your pants down again! (Unless you want to…)
Hide Yo’ Money!FAQ about Finding a Place to Stay in Faro
Here’s what people usually ask us about the areas of Faro and where to stay.
What To Pack For Faro
Pants, socks, underwear, soap?! Take it from me, packing for a hostel stay is not always quite as straightforward as it seems. Working out what to bring and what to leave at home is an art I have perfected over many years.
Ear Plugs
Snoring dorm-mates can ruin your nights rest and seriously damage the hostel experience. This is why I always travel with a pack of decent ear plugs.
Hanging Laundry Bag
Trust us, this is an absolute game changer. Super compact, a hanging mesh laundry bag stops your dirty clothes from stinking, you don’t know how much you need one of these… so just get it, thank us later.
Sea To Summit Micro Towel
Hostel towels are scummy and take forever to dry. Microfibre towels dry quickly, are compact, lightweight, and can be used as a blanket or yoga mat if need be.
Monopoly Deal
Forget about Poker! Monopoly Deal is the single best travel card game that we have ever played. Works with 2-5 players and guarantees happy days.
Grayl Geopress Water Bottle
Always travel with a water bottle! They save you money and reduce your plastic footprint on our planet. The Grayl Geopress acts as a purifier AND temperature regulator. Boom!
Check out my definitive Hotel Packing list for even more top packing tips!
Don’t Forget Travel Insurance for Faro
ALWAYS sort out your backpacker insurance before your trip. There’s plenty to choose from in that department, but a good place to start is Safety Wing.
They offer month-to-month payments, no lock-in contracts, and require absolutely no itineraries: that’s the exact kind of insurance long-term travellers and digital nomads need.
SafetyWing is cheap, easy, and admin-free: just sign up lickety-split so you can get back to it!
Click the button below to learn more about SafetyWing’s setup or read our insider review for the full tasty scoop.
Final Thoughts on Where to Stay in Faro
Faro is a charming city to visit and to wander around the traditional Portuguese ‘calçada’ style streets. No matter which neighborhood of Faro you choose, you’re sure to find a piece of Portugese paradise.
To recap our Faro neighborhood guide, Cidade Velha is the best place to stay in Faro if you’re on a budget. There are lots of budget friendly hostels and hotels near Cidade Velha that will keep your wallet happy! We love Casa d’Alagoa hostel with their warm, welcoming atmosphere and historic charm.
If it’s your first time to Faro, and you’re curious where to stay Faro for your first time, or maybe for just one night, indulge a little and stay in a seaside hotel on the Marina de Faro. You’re sure to love the views of the harbor at sunset.
And if you’re looking for the perfect hotel to cozy up in for your Faro trip, Faro Cosy Guest House in Downtown Faro is our top recommendation. It’s moderately priced, recently renovated, and conveniently located. Triple threat!
Are you a Faro aficionado? Let us know your best Faro travel tips in the comments below!
- Check out our ultimate guide backpacking around Portugal.
- Figured out where you wanna stay? Now it’s time to pick the perfect hostel in Faro.
- Swing by our super epic backpacking packing list to prep for your trip.
- Our in-depth Europe backpacking guide will help you plan the rest of your adventure.
Buy Us a Coffee!
A couple of you lovely readers suggested we set up a tip jar for direct support as an alternative to booking through our links. So we created one!
You can now buy The Broke Backpacker a coffee. If you like and use our content to plan your trips, it’s a much appreciated way to show appreciation 🙂
