The Best Hotels in Funchal, and Who Each One Is Wrong For
Best all-round: Castanheiro Boutique HotelFunchal is built into a hillside, so a hotel ten minutes from the market on a map can be seventy metres above it. Every walk below was routed and every height measured.
Which hotel should I book in Funchal?
Castanheiro Boutique Hotel is the best all-round base: eleven minutes from the market, a rooftop pool, and only sixteen metres of climb. Hotel Madeira does most of the same job for a lot less. Ignore both if you want a resort with a sea view, because neither has one.
Which one fits how you travel
Find the row that sounds like your trip. Every pick below names the traveller it is wrong for, so you can book on fit rather than on rank.
| If you are | Book | Why |
|---|---|---|
| On a first visit, three or four nights | Castanheiro Boutique Hotel | Central, flat enough, and a rooftop for the afternoon the weather turns. |
| Watching the budget but want to stay central | Hotel Madeira | Same part of town, a rooftop pool, one band cheaper. Small rooms are the trade. |
| Travelling with children | Hotel Baía Azul | Pools and space in the Lido strip. Accept that town is a bus ride. |
| A couple wanting quiet without leaving town | Hotel Porto Santa Maria | Adults-only, on the seafront, six flat minutes from the market. |
| Here for the hotel itself | Reid's Palace | The gardens and the setting are the point. Half an hour from the old town. |
| Arriving without a car and not planning to hire one | Barceló Funchal Old Town | Three minutes to the market and flat. Its lack of parking stops mattering. |
| Driving, with luggage | Quintinha São João | Off the cobbles, with a shuttle into town so the car can stay parked. |
- Free cancellation on most rooms
- No booking fee
- Prices on Trip.com
What the bands mean
Rates here are shown as bands rather than numbers. No Funchal hotel publishes a fixed nightly price - every one runs a live booking engine - so a figure quoted today would be wrong by the time you read it. The bands come from a live Trip.com check on 29 July 2026 for one night, two adults, across the whole city: eleven properties came back between 80 and 459 US dollars, with the middle of the range at 249.
- €
- under about 120 dollars a night on the dates checked
- €€
- roughly 120 to 200
- €€€
- roughly 200 to 320
- €€€€
- over 320
The 10 hotels, and who each one is wrong for
Walking times are to Mercado dos Lavradores. Walking times are real pedestrian routes to Mercado dos Lavradores, measured through OpenStreetMap foot routing at 4.5 km/h, not straight lines. The height figure is the hotel's elevation above the market, from the EU-DEM 25 m terrain model. Funchal's gradients are the reason both numbers are here: distance alone tells you almost nothing on this island.
Barceló Funchal Old Town
€€€The closest hotel to the market, with a rooftop pool and bar over the old town roofs.
- Walk to Mercado dos Lavradores
- 3 minutes, 190 m, and 4 m downhill to Mercado dos Lavradores
- Right for
- Anyone who wants to step out of the door and already be in the old town.
- Wrong for
- Wrong for: Drivers. It has no car park of its own, and this is the hardest part of Funchal to park in.
- The catch
- The catch: You are sleeping in the busiest part of the old town. The restaurant terraces on Rua de Santa Maria run late and the sound goes up, not away.
Hotel Porto Santa Maria
€€€Adults-only, on the seafront at the eastern end of the promenade, with an outdoor and an indoor pool.
- Walk to Mercado dos Lavradores
- 6 minutes, 410 m, and 10 m downhill to Mercado dos Lavradores
- Right for
- Couples who want the old town on the doorstep but not directly overhead.
- Wrong for
- Wrong for: Families. It does not take children, so this is a hard no rather than a preference.
- The catch
- The catch: Parking is private but charged, and the approach road down to it is narrow and one-way in places.
Castanheiro Boutique Hotel
€€Best all-roundFive restored buildings knitted into one hotel in the historic centre, with a rooftop pool and jacuzzi and an indoor spa pool.
- Walk to Mercado dos Lavradores
- 11 minutes, 810 m, and 16 m of climb to Mercado dos Lavradores
- Right for
- A first visit. It is central, it is genuinely quiet for how central it is, and the rooftop earns its keep on a wet afternoon.
- Wrong for
- Wrong for: Anyone booking Funchal for a sea view. You are two streets inland and the view is over rooftops.
- The catch
- The catch: The car park is private but charged, and the streets around it are the steep cobbled ones. A suitcase on that surface is a genuine nuisance.
Hotel Madeira
€Best valueA small three-star in the centre with a rooftop pool and bar, near the municipal garden.
- Walk to Mercado dos Lavradores
- 14 minutes, 1.0 km, and 10 m of climb to Mercado dos Lavradores
- Right for
- Anyone who wants a central base and a rooftop and would rather spend the difference on the island.
- Wrong for
- Wrong for: Anyone who needs space. The rooms are noticeably small, which is the trade for the price and the postcode.
- The catch
- The catch: Parking is charged and not on site. On a three-star budget that cost is a real share of the nightly rate.
Pestana CR7 Funchal
€€A four-star on the harbour front with a rooftop outdoor pool, sauna and jacuzzi.
- Walk to Mercado dos Lavradores
- 18 minutes, 1.3 km, and 6 m downhill to Mercado dos Lavradores
- Right for
- Younger travellers and anyone who wants the marina and the harbour rather than the old lanes.
- Wrong for
- Wrong for: Anyone after a quiet, traditional Madeira. The whole property leans hard on one theme and does not pretend otherwise.
- The catch
- The catch: Parking is public and charged rather than the hotel's own, and the harbour front is exposed when the wind gets up.
Quintinha São João
€€€A five-star with gardens and a spa on the hillside above the centre, with indoor and outdoor pools.
- Walk to Mercado dos Lavradores
- 27 minutes down, 2.0 km, and 71 m of climb on the way back to Mercado dos Lavradores
- Right for
- Anyone who wants quiet and greenery and is happy to be driven into town.
- Wrong for
- Wrong for: Anyone planning to walk everywhere. The free shuttle exists precisely because the walk back does not work.
- The catch
- The catch: That 71 m is the whole story. Downhill into town is pleasant, uphill at the end of a long day is not, so you are on the shuttle or in a taxi.
Savoy Palace
€€€€The big modern five-star on Avenida do Infante, with a rooftop and a spa over the bay.
- Walk to Mercado dos Lavradores
- 28 minutes, 2.1 km, and 40 m of climb to Mercado dos Lavradores
- Right for
- Anyone who wants a full-service city resort with sea views and does not mind a walk into the old town.
- Wrong for
- Wrong for: Anyone who came for old Madeira. This is a glass-and-scale hotel, and the character is in the service, not the building.
- The catch
- The catch: It is a large hotel and it feels like one at breakfast. The seafront promenade walk into town is pleasant but it is not short.
Reid's Palace
€€€€The 1891 clifftop hotel west of the centre, with terraced gardens, several pools and a Michelin-starred restaurant.
- Walk to Mercado dos Lavradores
- 33 minutes, 2.5 km, and 30 m of climb to Mercado dos Lavradores
- Right for
- Anyone treating the hotel as the destination. The gardens and the afternoon tea are the reason to book it.
- Wrong for
- Wrong for: Anyone who wants to be in the middle of things. You are half an hour from the market and the hotel knows it.
- The catch
- The catch: Deliberately old-fashioned. That is the appeal for most guests here and an irritation for the rest, so read it as a warning as much as a selling point.
Hotel Baía Azul
€€A renovated four-star out in the Lido hotel strip, resort-shaped with several pools.
- Walk to Mercado dos Lavradores
- 56 minutes, 4.2 km, and 31 m of climb to Mercado dos Lavradores
- Right for
- Families and longer stays who want pools and space more than they want the old town.
- Wrong for
- Wrong for: A short first visit. You will spend the trip commuting to the part of Funchal you came to see.
- The catch
- The catch: Nearly an hour on foot to the market. In practice you are taking the bus or a taxi every time you go into town, and that adds up over a week.
Casa Velha do Palheiro
€€€€A converted hunting lodge in the hills east of Funchal, with a golf course, a spa and indoor and outdoor pools.
- Walk to Mercado dos Lavradores
- Not walkable: 5 km and 496 m above the market to Mercado dos Lavradores
- Right for
- Golfers and anyone who wants the mountains, the gardens and complete quiet.
- Wrong for
- Wrong for: Anyone without a car or a taxi budget. This is not a base for seeing Funchal.
- The catch
- The catch: That 496 m of elevation is the single most important number on this page. It puts you in a different climate band from the seafront, and it means every trip into town is a drive.
Where not to book in Funchal
There is no unsafe part of central Funchal, so the thing to avoid is a gradient rather than a district. Anything above roughly the Rua do Castanheiro line puts a real climb between you and dinner, and the cobbled calçada surfaces are hard on wheeled luggage in a way photographs never show. The other trap is the Lido strip. It looks central on a map of the bay, but Baía Azul is a fifty-six minute walk from the market, so book it for the pools or not at all. And if you are staying above the town without a car, check the hotel actually runs a shuttle before you rely on one.
When to book
Funchal has two spikes rather than a summer season. New Year, when the bay fireworks fill the city and the seafront hotels sell out months ahead, and the Flower Festival in spring. Outside those, the island runs warm and even all year, which is why prices move less here than on the mainland and why booking six to eight weeks out is usually enough. If you want a rooftop-pool room in the old town specifically, go earlier: those hotels are small and there are not many of those rooms.
Best hotels in Funchal: FAQ
The questions travellers ask most when picking a hotel here.
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