Panoramic view over city of Funchal, from Miradouro das Neves viewpoint, Madeira, Portugal

Planning a trip to Funchal, Madeira and looking for the perfect place to stay? My accommodation guide will help you choose the best Funchal hotel or other lodging for your needs.

Funchal, the charming capital city of Madeira, is known for its stunning landscapes and gardens, beautiful old town and vibrant culture. It’s also the best place to stay if you intend to take group tours around the island as most leave from Funchal. Likewise, public transport to other parts of the island is easier from Funchal.

Where you choose to stay will depend on what you want from your Madeira holiday accommodation. Everything is possible, from clifftop resorts overlooking the ocean to gorgeous traditional-style hotels surrounded by lush gardens, boutique guesthouses in the heart of the old town and apartments dotted all over the city.

On my first trip to Funchal, I recall being somewhat surprised at how hilly it is. If I’d thought about it/researched more, I would have been prepared for the fact that once you get away from the waterfront and old town centre of Funchal, the city extends up the slopes. There are buses and taxis and Bolt (alternative to Uber) to help you get around but it’s worth bearing this in mind when choosing your hotel.

For visiting the main sights, I found it more convenient to be in the historical centre than where we stayed the first time, which was a long walk or a bus ride away from where we actually wanted to spend our time.

That said, the more upmarket hillside/hilltop hotels offer free shuttle buses to the old town so if you’d rather be surrounded by beautiful gardens with amazing views, this is also an option.

Many of the larger hotels are in an area called the Lido, to the west of the old town. There are several ocean-side seawater swimming pools here and countless restaurants, bars and shops. It’s more modern than the old town but there are frequent buses to the historical centre so it’s a good option, especially if you like the resort-style hotels or have kids.

In this article, I’ll guide you through the best hotels in Funchal so that you can pick the best location and lodging.

If you’re thinking of staying in different bases around the island, check out my Where to stay in Madeira post for great ideas.

Poças do Governador swimming complex, Funchal, Madeira
Poças do Governador swimming complex, Funchal, Madeira

Wherever possible, I choose accommodations that follow sustainable practices, as indicated by the number of leaves (3 is the top score). No leaf simply means that I can’t verify their current efforts regarding sustainable travel but I love the property.

5-star hotels in Funchal

Green Sustainability leaf for hotels

The rooms at this luxury hotel are spacious and elegant, with tranquil gardens surrounding them – my dad and his partner absolutely loved their stay here. Guests can indulge in a range of treatments at the onsite spa and enjoy the indoor and outdoor pools. The hotel, located on the outskirts of Funchal, offers a complimentary shuttle service to and from the marina, although it’s technically within walking distance. There’s also an indoor car park available. Check for availability.

Reid’s Palace

Belmond Reid's Palace Hotel in Funchal, Madeira
Belmond Reid’s Palace Hotel in Funchal, Madeira

Stay in this charming historical 5-star resort hotel set in a superb location overlooking the Atlantic with very professional staff and a Michelin star restaurant onsite. It has several pools, an oceanfront spa and direct access to the ocean. All rooms are elegantly furnished with period décor, light and spacious. The complimentary minibar is a welcome bonus, as is the free parking and shuttle bus. Note that a dress codes applies for afternoon teaPick a room with a view.

Green Sustainability leaf for hotels
Green Sustainability leaf for hotels
Quinta dos Palheiros hotel, Madeira
Casa Velha do Palheiro Relais & Chateaux

If you enjoy golf, gardens and views, you can’t go wrong with this 5-star manor house hotel dating back to 1804. Set within glorious gardens high above the city, it offers discounts on its golf course and a shuttle bus service to Funchal, although there is free parking on site, too. Spa treatments, indoor and outdoor pools, a tea room and restaurant add to its appeal. Check current prices.

4-star hotels, Funchal

Green Sustainability leaf for hotels
Castanheira Boutique hotel rooftop pool and views
Castanheiro Boutique hotel rooftop pool and views

The Castanheiro Boutique Hotel is a beautifully designed hotel that maintains the charm of the original building. It is located on a quiet road in the old town so it’s close to all amenities. The rooftop pool and hot tub offer stunning views of the sea and hills all year round. The rooms are spacious, modern, and clean, and the beds are extremely comfortable. The breakfasts are also excellent. Don’t miss the chance to book a room at this amazing hotel.

ARTS IN Hotel Conde Carvalhal

This hotel has suites in the original mansion and studios in the modern annex. From it’s hillside location to the east of the old town, you can enjoy panoramic views of the city, mountains, and sea or relax in the beautiful botanical garden. Choose your room with a view.

Green Sustainability leaf for hotels
Green Sustainability leaf for hotels

This stunning hotel has been newly renovated and is very close to Funchal’s Lido beachfront. This 4-star hotel offers 3 swimming pools, 3 restaurants, a spa and a sun deck overlooking the Atlantic Ocean and the gardens. Underground parking is available (at extra cost). Grab a sea view room.

3-Star Funchal hotels

Hotel Catedral

This small 3-star hotel is conveniently located near the cathedral in the heart of Funchal old town. The rooms are clean and comfortable, with air conditioning and free parking available. If you’re looking for a city centre option, this hotel is a good choice. Take a look at these reviews to learn more.

Enjoy a rooftop pool and outdoor spaces at this lovely 3-star hotel. It’s perfect for exploring the old town. The hotel has spacious rooms and public areas with a 1960s theme. Book your favorite room and enjoy your stay!

Side street, Funchal, Madeira
Take your time and wander along a side street in Funchal, Madeira

Apartments in Funchal

With great views over the city and ocean, this self-catering accommodation is quite high above the old town. If you’re quite fit, it’s walkable but there’s free parking if not. All units are spacious, bright and colourful and and have the use of a pretty garden. . Choose your dates.

Central – São Pedro Boutique

These newly furnished studios and apartments are modern and stylish and just metres away from the lovely municipal park in the old town. The beds are comfortable and large and the host replies quickly if required. Select your apartment.

Green Sustainability leaf for hotels

These lovely studios, with access to the garden surrounded private pool, have well equipped kitchenettes and a private balcony with sea-views. The studios are clean and spacious and the hosts are very friendly. A 20-minute walk will get you to the Marina but you might want to use transport to get back up the hill. See availability.

Good Memories Lodge

You can choose from a range of apartments and studios at this welcoming accommodation. It’s a very easy check-in process and you’ll find the host more than happy to help. It’s within walking distance to all you’ll need in the old town. See photos and reviews.

None of these take your fancy? Search for hotels in Funchal

For a home that sleeps up to 6 in the Lido area try Where The Sky Meets The Sea. Enjoy views of the Atlantic Ocean and Cabo Girão from the balcony. This modern apartment has a fully equiped kitchen and communal pool. See photos.

If you’re looking for longer-stay options in and around Funchal, then try Flatio. They’re a rental housing platform, mostly deposit-free, that offers lawyer-verified, legally binding lease agreements that can be used as proof of address and for visa purposes.

Over to you. Please share your thoughts in a comment.