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Where to stay in Algarve: Faro, Portimão or Lagos?

by Cecilie
Published: Last Updated on
Where to stay in Algarve? blog post header

Are you looking into traveling to the Algarve Coast, but you can’t decide on where to stay? Then this blog post might be perfect for you!

In the fall of 2021, I was lucky enough to visit 3 cities on the Algarve Coast – Faro, Portimão and Lagos – and I was pleased to find that they all had something different to offer.

That’s why I’ve decided to make this Algarve-city-guide for you.

But in reality, whether you’re staying in Faro, Portimão, Lagos or in another city, you most likely won’t be disappointed with your choice. Because let’s face it… the Algarve Coast is one of the most beautiful destinations in all of Europe!

This blog post is merely my own personal experience in (and opinion of) some of the big cities in Algarve.

Now let’s get started on this blog post about where to stay in the Algarve, so that you can get packin’ for your next trip to Portugal’s beautiful coast in the South!

*DISCLOSURE: Dear reader, this blog post contains affiliate links. If you click on them, I may earn a commission at no extra cost to you. I only recommend tours, hotels, and products which I use myself or find worthy to recommend.*


Where to stay on the Algarve Coast in 2022?

Before we begin comparing Faro, Portimão and Lagos, I’d like to stress that these are my own opinions, and you might feel different about these cities once you get there.

I’m going to be completely honest in my review because it might actually help someone who wants a more personal take on where to stay in the Algarve.

Another thing to notice is that Glenn and I visited the Algarve Coast in November, which means that we weren’t part of the busy tourist season. So all cities might have a different feel to them if you visit during peak season.

Now enough blabbering… Let’s get started! Here is my review of Faro, Portimão and Lagos. Hopefully it’ll help you in your decision-making on where to stay during your time on the Algarve Coast.

1. Faro – Tourist Hotspot

Faro is the capital of the Algarve and the second largest city in the region (measured by inhabitants). There is also an international airport in Faro, which means that it’s often the main gateway to the Algarve Coast for international tourists.

When we headed to the Algarve Coast, we first decided to stay in Faro because we didn’t know anything about the region… Faro seemed like a good starting point, and it really was.

We ended up spending 3 nights in Faro, and we honestly think that this was more than enough.

During our time in Faro, we explored the old part of the city, went for a super great hike in Ria Formosa named Ludo Hiking Trail, and ate some really good food. We spent a total of €383/2 people for 3 days in Faro including accommodation, food, and activities.

Faro city sign in Algarve - one of the most popular places to stay
Welcome to Faro!

Why stay in Faro

  • Faro is super accessible because it has an airport, train station, and bus station.
  • The city is located right by Ria Formosa National Park.
  • Island hopping in Ria Formosa is one of the best things to do.
  • You can find flamingos and many other birds on Ludo hiking trail.
  • There are some great beaches close to Faro.
  • Faro is close to many popular golf resorts.
  • The old town of Faro is very beautiful.
  • Accommodation is pretty cheap.
  • You can eat the best octopus in your life here!

Now that I’ve listed why you should stay in Faro during your trip to Algarve, I also want to be honest about a couple of things that Glenn and I didn’t like about Faro: Since Faro has an Airport, it also means that a lot of international tourists are flying in, which means that the prices for food and drinks are a bit more expensive here. Plus, it was harder to find local, Portuguese places to eat in Faro than in Portimão, for example. Also, there weren’t really that many things to do in Faro itself as the city is more like a gateway to the rest of the Algarve Coast.

Delicious octopus from the OLD TAVERN in Faro, Algarve
The best grilled octopus I’ve had in my life! At OLD TAVERN Restaurant in Faro
Viewpoint from Faro Cathedral
The view from the top of Faro’s Cathedral – a must visit!

Where to stay in Faro

During our stay in Faro, we slept in a hostel named Baixa Terrace Hostel. We found that the hostel okay, but we would probably stay somewhere else on our next visit. So, I’ve spent some time researching the best places to stay in Faro depending on your budget.

I set the travel date to a weekend in June. So, this is what you can expect to pay for your stay during the beginning of the busy summer season in Algarve. But take notice that the prices might have changed since my research. I used my 2 favorite platforms: Booking.com and Hostelworld.com.

Here is where I would stay in Faro city center depending on my budget for visiting the Algarve:

Budget-friendly places to stay in Faro

Mid-range budget places to stay in Faro

Luxurious places to stay in Faro

  • Roots Hotel (€148 for an apartment with a terrace)
  • 3HB Faro (€243 per night for a double room in a 5-star hotel)

2. Portimão – Local Touch

Portimão is also one of the largest cities on the Algarve Coast, but it has a very different feel to it than Faro. Unlike Faro, you won’t find many international tourists in Portimão. It definitely has a more local touch to it.

We only spent 2 nights in Portimão during our stay on the Algarve Coast, so we didn’t really get to know the city that well. But it’s a great city to stay in if you want to visit the Benagil Cave, Carvoeiro and other small towns, or the incredible Seven Hanging Valleys Hike. Portimão is only a short bus ride away!

During our 2-night stay in Portimão, we ate some incredible (and cheap!) Portuguese food at a local Taverna named Largo, we explored the beautiful Praia da Rocha, and we took the bus to Carvoeiro and went hiking on one of the best trails in Europe – the Seven Hanging Valleys. We spent a total of €241/2 people for 2 days in Portimão including everything from accommodation, food, bus transportation etc.

People boarding a boat tour to Benagil cave from Portimão
One of many boat tours about to leave from Portimão to Benagil Cave

Why Stay in Portimão

  • Portimão has a more local feel to it.
  • It’s easier to find cheap and good Portuguese food.
  • Praia da Rocha is an amazing beach!
  • You can go surfing in the area.
  • It’s close to great places like Carvoeiro, Benagil Cave and the Seven Hanging Valleys Trail.

Now that I’ve listed why you should stay in Portimão during your trip to Algarve, I also want to be honest about a couple of things that Glenn and I didn’t like about Portimão: While Portimão is close to many great places on the Algarve Coast, there isn’t that much to do in the city itself. We also think that it’s more quiet in a way… So if you’re looking to meet other travelers, then I wouldn’t recommend you to stay here.

Me hiking the Seven Hanging Valleys on the Algarve Coast
The Seven Hanging Valleys was one of the best hikes I’ve ever done! Only a short bus ride away from Portimão
Portimão's beach and boardwalk
Portimão’s beach and boardwalk is a must visit!

Where to stay in Portimão

During our stay in Portimão, we slept in a hotel named Next Inn, and we will probably stay here again for our next visit. But I’ve still spent some time researching the best places to stay in Portimão depending on your budget – just so you have something to choose from!

I set the travel date to a weekend in June. So, this is what you can expect to pay for your stay during the busy summer season in Algarve. But take notice that the prices might have changed since my research. I again used my 2 favorite platforms: Booking.com and Hostelworld.com.

Here is where I would stay in Portimão city center depending on my budget for visiting the Algarve:

Budget-friendly places to stay in Portimão

Mid-range budget places to stay in Portimão

Luxurious places to stay in Portimão

3. Lagos – Backpacker’s Paradise

Lagos is one of the most popular places to stay in the Algarve – and with good reason!

The city is smaller than Portimão and Faro, yet it seems like there is so much more to do here. Apart from markets, museums, and exploring the old part of Lagos, you can also visit some incredible beaches, hike past the rock formations towards Ponta da Piedade, go kayaking, and much more! There is also some great coffeeshops, cheap restaurants, and a thriving nightlife in Lagos.

Lagos is bustling with life and it’s become a great backpacking and digital nomad destination in Portugal. So this is where you want to go if you’re looking to meet other travelers.

We spent 5 nights in the city – 1 night in a hostel and 4 nights in a rental apartment. During our trip to Lagos, we spent a lot of time in the coffee shops working (on this site) …and in the bars drinking. But we also managed to hike to Ponta da Piedade, go on a kayak tour, and relax on the beach (even in the middle of November!). We spent a total of €626/2 people for 5 days in Lagos including everything from accommodation, food and drinks, tours etc.

Lagos city center - the best place to stay in the Algarve
Lagos City Center is just lovely!

Why stay in Lagos

  • Lagos is a great backpacker destination.
  • The city center is beautiful and full of shops and cafés.
  • A short stroll from the city center will take you to incredible beaches.
  • You can hike to Ponta da Piedade and experience all the cliff formations.
  • There are both Portuguese and international restaurants.
  • You have the opportunity to find very cheap places to eat.
  • Lagos has a great nightlife.
  • It’s easy to meet other travelers.
  • There are several coffee bars which you can work in.
  • Lagos is full of beautiful graffiti artworks and has a modern, hip vibe to it.
  • There are many things to do such as kayaking, surfing, paddle boarding etc.

Now that I’ve listed why you should stay in Lagos during your trip to Algarve, I again want to be honest about a couple of things that Glenn and I didn’t like about Lagos: You can expect a bit more hassle from tour operators in this city. For example, it’s not possible to rent a kayak alone in this area of Algarve, however, you can go paddle boarding alone for some reason…? This means you have to buy a kayak tour. Also, there are no cheap supermarkets in the city center, so you have to walk out of the center to find a Pingo Doce or Lidl.

Cliff beach in Lagos, Algarve, Portugal
One of many great beaches along the Ponta da Piedade hike – a short stroll from Lagos
Kayak tour in Lagos, Portugal
One of the most popular things to do in Lagos is a kayak tour!

Where to stay in Lagos

During our stay in Lagos, we slept in two different places. We spent 1 night in a hostel named The Island Hostel (great place to meet people, but a bit dirty…) and 4 nights in a great Airbnb apartment.

But next time, we’ll try to go somewhere else. So I’ve also spent some time researching the best places to stay in Lagos depending on your budget.

I set the travel date to a weekend in June. So this is what you can expect to pay for your stay during the busy summer season in Algarve. But take notice, the prices might have changed since my research. I (as always!) used my 2 favorite platforms: Booking.com and Hostelworld.com.

Here is where I would stay in Lagos city center depending on my budget for visiting the Algarve:

Budget-friendly places to stay in Lagos

Mid-range budget places to stay in Lagos

Luxurious places to stay in Lagos


My favorite place to stay in the Algarve

If I was lucky enough to return tomorrow, then where would I stay on the Algarve Coast? Faro, Portimão or Lagos?

Definitely LAGOS! If you hadn’t noticed…

We ended up spending 5 full days in Lagos, and we had such a great time! We actually had the opportunity to meet other backpackers in out-of-season November, which meant we could go out and have a few drinks with other people than just each other (long-term travel couples will get this…)

There were just so many things to do in Lagos, and I understand why it’s one of the most popular places to stay in Algarve.

Also, Lagos isn’t just for backpackers. You can easily enjoy a long stay in this Algarve city with children or as a couple. There is something for every kind of traveler in Lagos!

Other places to stay on the Algarve Coast

Where else can you stay in the Algarve? Maybe Faro, Portimão, and Lagos isn’t your cup of tea – or you’ve already been there and want to discover a new place.

Another one of the most popular cities to stay in the Algarve is Albufeira. And I can’t wait to visit some day!

So make sure to check out hotels in Albufeira, Tavira or Olhão if you’re interested in visiting more cities of the beautiful Algarve Coast.

How to get between cities in Algarve

It’s super easy to travel between the Algarve cities without a car!

There is one train line and several bus lines that go past most of the coastal cities. Search for “Terminal Rodoviàrio” if you are looking for the main bus station in any city. The bus is cheaper than the train, but only by a couple of euros.

Make sure to have small change with you, or no bigger bill than €10 if you’re taking the bus. You pay onboard and the driver doesn’t always have that much change.

You can buy train tickets online or at the train station just before departure.

If you need to get around within the cities of Algarve, then you can always grab a taxi – or an Uber if you prefer that.

Train line between cities in Algarve Coast, Portugal
It’s super easy to take the train between the cities of Algarve!

I hope you enjoyed this blog post about where to stay on the Algarve Coast. If you have any questions about Faro, Portimão, or Lagos, then make sure to leave a comment below.

Thank you so much for reading! And enjoy the beautiful Algarve Coast.

Want to read more about Portugal? Then check out these blog posts:

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