How do you decide where to stay in Lisbon if you’re visiting for the first time? Portugal’s capital city is a fascinating blend of historical charm, timeless traditions, urban cool, faded and restored grandeur and cosmopolitan chic. To fully appreciate it, you’ll need to choose the best area to stay in Lisbon depending on your interests.
If you want to be in the heart of the city within walking distance of sights, restaurants, transport and shops, Chiado, Baixa, Principe Real, Bairro Alto, Avenida and Alfama are the main options. Although not far apart, each neighbourhood has its own personality and characteristics which I’ll tell you about in a moment.
I’ve also picked out some great places to stay in each area so you don’t have to waste hours trawling through unsuitable options.
Note: I haven’t bothered with the big chain hotels – you can find them easily enough and know what to expect from them. I prefer unique, boutique places that offer excellent value for money.
Why stay in Chiado?
For me, Chiado combines the best of all the things I want from a trip to Lisbon. I can walk to shops and sights in Chiado, Principe Real and Baixa and the restaurants and bars in Bairro Alto and Cais do Sodré. Served by the blue and green metro lines, a myriad of buses and tram #28, it’s about as convenient a location as they come.
As well as a hotchpotch of big name stores and independent shops that have withstood decades of change, there are other things to see here:
- Largo do Chiado with the iconic Café A Brasileira and the statue of beloved poet, Fernando Pessoa*
- The National Museum of Contemporary Art and several independent art galleries
- Largo de Camões, named after Portugal’s 16th century literary hero and a popular meeting spot
- Largo do Carmo, Convento do Carmo and the Archaeological Museum
- São Roque Church
*My GPS activated Lisbon walking tour starts in Largo do Chiado and takes you to many of these places and onwards to Principe Real.
Best places to stay in Chiado
Lisboa Carmo Hotel is a small luxury hotel in the very charming Largo do Carmo with great views from the upper floors.
Just down the road from this lovely square you’ll find the delightful Casa Balthazar, which has a rooftop hot tub with views of Lisbon and a small pool in the garden. The luxurious self-catering apartments are the kind of place you don’t want to leave and breakfasts are sourced from Confeitaria Nacional, one of Lisbon’s oldest bakeries. It’s also a stone’s throw from my favourite restaurant, Café Buenos Aires.
If they’re fully booked or your budget doesn’t stretch that far, try Apartments in Chiado. They have a lift and air-conditioning and some of the rooms have wonderful views.
Another, reasonably priced, 4-star hotel option in Chiado is the Mercy Hotel, which has the bonus of a fabulous rooftop bar.
Teatro Bed and Breakfast is modern, unique and chic, and more affordable than the previous options.
Lisbon’s Baixa neighbourhood
You’ll often see Baixa and Chiado grouped together – they’re close enough share a metro station, after all. The difference is that Baixa, which means ‘low’ is just that, a flat grid of streets at the base of Lisbon’s city centre. The straight streets, named for the trade that each street was originally designated for, were designed by the Marquês do Pombal, the man responsible for rebuilding Lisbon after it was flattened by the 1755 earthquake.
The area has seen something of a revival in recent years with a crop of new hotels, shops, restaurants and museums and a revamped royal square. It can feel rather touristy and there’s a fair amount of traffic noise but it’s extremely convenient for walking around the centre and getting transport further afield.
Baixa sights and attractions
Aside from the shops and restaurants, you’ll find:
- Praça do Comércio, aka Terreiro do Paço, the former royal square overlooks the River Tagus and is lined with shops and restaurants
- MUDE fashion and design museum
- Rua Augusta archway and elevator, the entrance to and viewing platform over Praça do Comércio
- Lisbon Story Centre, an interactive museum about Lisbon’s history
- Rossio square with its wavy black and white paving and beautiful train station
- Santa Justa elevator, which goes up to Largo do Carmo
Where to stay in the Baixa
As the name suggests, Internacional Design Hotel is bright, modern and full of attractive design features. A member of the Small Luxury Hotels of the World, it’s ideally located in Rossio square.
For more old-world luxury and to feel like royalty, you could stay at the recently renovated Pousada de Lisboa in Praça do Comércio.
For a cheaper stay in a quirky, colourful apartment with a rooftop terrace, try Lisbon Short Stay Apartments.
If that’s too garish for your tastes, the soothing, stylish decor of Casas da Baixa by Jules and Madeleine might be a better, albeit slightly more expensive, option.
Avenida da Liberdade and Marquês do Pombal
The wide leafy avenue that connects the Baixa with Parque Eduardo VII is lined with classy hotels and internationally renowned designer stores. The central strip of cobbled park offers patches of greenery and a few kiosk bars that can be quite lively in the early evening thanks to busking bands.
Once you get to the top of the avenue and past the statue of the Marquês do Pombal, you’re in a more business-oriented district with big banks and companies and busy main roads. Off these arterial roads there are smaller residential streets with all the amenities you’d expect to find, such as supermarkets and cafés.
Transport connections are easy, especially from Marquês do Pombal, which is about a 30-minute walk from the Baixa.
Sights on and around Avenida da Liberdade
- The next big square after Rossio is Restauradores with its massive obelisk commemorating liberation from Spain
- The 18th century Palácio Foz houses the tourist information centre
- Casa do Alentejo, one of my favourite spots in Lisbon, lies just off the central avenue
- Elevador da Glória, the antique wooden tram, leaves from here to go up the hill to Principe Real
- Parque Eduardo VII offers amazing views from the top and contains the cool greenhouse, Estufa Fria
Best hotels around Avenida da Liberdade in Lisbon
My top choice would be Inspira Santa Marta Hotel and Spa as it offers excellent value for money for gorgeous, eco-friendly upmarket accommodation. If you enjoy spending time in hotels and making use of their spa facilities, wine tasting and other activities, this is the place to come. Their Mediterranean restaurant caters well to vegetarians and a range of food intolerances.
For a more classical environment with historical touches and full modern comforts, you might prefer the Heritage Avenida Liberdade, a 4-star boutique hotel in an 18th century building that has an indoor pool.
Of the 5-star hotels on Avenida Liberdade, I particularly like Valverde Hotel for its Art Deco style and beautiful architectural features and wooden floors. It has a patio area and outdoor pool, too, perfect for a dip after a day of sightseeing.
Magnolia Guesthouse is a charming find just off Marques do Pombal roundabout so close to the metro and the park with antique tile panels in the entrance hall. Interior design lovers will appreciate the care and attention to details that Raquel has put into creating a unique, welcoming place to stay in the heart of Lisbon.
On the other side of the park is The Sky Lofts Lisbon. If you don’t mind sharing a bathroom, this well-decorated, clean and comfortable bed and breakfast is great value, has a lift and is directly opposite Parque metro station.
If you walk up Rua da Misericordia from Chiado or head west of Avenida da Liberdade, you will find yourself in Principe Real, one of Lisbon’s trendiest and gay-friendliest neighbourhoods. Not only does it boast fabulous urban designer and concept shops and small attractive parks, it is also packed with restaurants and cafés. I love this area, which is why it’s also part of my Lisbon walking tour.
It’s also on the doorstep of Bairro Alto, one of Lisbon’s most famous nightlife spots, but not so close that you’ll have revellers under your bedroom window until the wee hours.
It’s about 7 minutes walk from two metro stations – Rato on the yellow line and Baixa/Chiado on the blue and green lines. Buses run through the centre to connect you with Cais do Sodre and other parts of the city.
What to see and do in Principe Real
- Shoppers will find plenty of temptations in independent shops and the Embaixada or EntreTanto shopping centres
- Principe Real gardens are a pleasant place to hang out with local residents in a kiosk bar
- São Pedro de Alcântara viewpoint offers spectacular views of Lisbon
- Jardim Botanico is next to the Science and Natural History Museum
- Praça das Flores is a little square with a fresh crop of trendy food shops, cafés and restaurants
Where to stay in Lisbon’s Principe Real neighbourhood
For luxury, design, service and location, Principe Real’s latest hotel, the Memmo Princípe Real looks hard to beat. The rooftop pool with a view is a particularly welcome feature.
Casa do Principe (The Prince’s House) is right next door to Embaixada and overlooks Principe Real gardens. It’s a cosy bed and breakfast that will treat you like royalty. The ceilings in the Dom Pedro suite are a sight to behold and the whole place is beautifully and tastefully decorated.
For a more residential location and the possibility of self-catering you have Flores Guest House, just off Praça das Flores. Beautifully renovated and stylishly decorated, the accommodation comes in the form of apartments, rooms and studios.
Bairro Alto is one of Lisbon’s liveliest districts for nightlife. During the day, it looks nothing special but at night, ground floor doors are thrown open to reveal numerous bars and restaurants although most people hang out in the streets. There are some quirky shops around here, too.
There are several quiet streets within this neighbourhood so I wouldn’t rule it out as a place to stay although it wouldn’t be my first choice. If you’re young(ish) and want to party all night, you might want to stay in the thick of it but pick wisely and read reviews carefully. It is up a hill and although there are buses to nearby Principe Real, you’ll either have to walk or take a taxi into the labyrinth of narrow streets.
Best place to stay in Bairro Alto
A Casa Das Janelas Com Vista (The House Of The Windows With Views) is not just views, although they are fabulous. The quirky decor and repurposed furniture sit well within a restored building in a quiet side street in the heart of Bairro Alto. Breakfast is fabulous!
Lisbon’s oldest district spreads down the hill from St. George’s castle and encompasses the 12th century cathedral. I really like Alfama’s narrow cobbled streets and tightly packed houses. It’s like a village within the city and there is still a close-knit community living here despite the ever-increasing volume of tourists. Don’t be surprised to see remnants of street decorations or see people barbecuing sardines in the street.
Tram #28 trundles through this neighbourhood. There are also some free public elevators that make it easier to cope with the hill during working hours. Other than that, you’ll have to walk or take a cab. Don’t even think of driving in this part of Lisbon – it’s not even possible to get a car down some of the narrow cobbled lanes.
While atmospheric and definitely a place to get lost in during the day, you might find Alfama more frustrating when the taxi driver can’t find your accommodation or you’re trying to make your way back at night.
Alfama’s sights and attractions
- Beneath the 12th century Romanesque cathedral lies excavated Roman ruins and Islamic baths
- São Vicente da Fora Monastery is an interesting museum with fabulous views
- The National Pantheon also offers spectacular views from the domed rooftop
- St. George’s Castle is well worth a visit, again for the views from the battlements
- Alfama’s most popular viewing spots are Santa Luzia and Portas do Sol
- The Museum of Decorative Arts is inside an aristocratic house with period decor
Best Alfama accommodation
It’s no surprise that the Memmo Alfama Design Hotel has won several awards. It has outstanding views and impeccable facilities including iPod docking stations in the rooms.
Once a religious building, Hotel Convento do Salvador has been thoroughly modernised and as well as comfy, bright rooms, you’ll find some stunning works by contemporary Portuguese artists dotted around the building. The inner courtyard is a great spot for relaxing or sunbathing.
For self-catering options, choose from apartments or suites at Lisbon Lounge Suites, some of which have river views.
There are, of course, other areas to stay in Lisbon but these are the most centrally located and allow you to do a great deal of sightseeing and exploring on foot.
Not ready to sort out your Lisbon accommodation yet?
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Disclosure: The links on this page about where to stay in Lisbon are mostly to my hotel partners, Booking.com and Hotels Combined. At no extra cost to you, I may receive a small commission if you book via these links, which would go towards the cost of maintaining this blog. I use both booking platforms myself and trust the verified reviews and descriptions as well as the booking and cancellation service so I have no qualms about recommending them to you.
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