Where to stay in Madeira. 🏨 A base that keeps everything close

Madeira is small, but the mountain roads are twisty, so where you stay shapes the whole trip: how much time you spend behind the wheel, what weather you get day to day and whether you need a car at all. In this guide I compare the most popular areas: Funchal, Caniço, Câmara de Lobos, the west and north coasts and the area around the airport.

I spent a month living close to the centre of Funchal, in a studio with a balcony, together with my mixed-breed dog Tesla. I chose the city rather than a coastal resort because, working remotely and travelling with a dog, what mattered to me was good internet, parks for walks and everything within easy reach. I write more about that stay in Madeira with a dog.

Where to stay in Madeira: the areas compared

Hotel or apartment?

In Madeira you choose between hotels and holiday apartments or houses (alojamento local, the Portuguese licence for short-term lets). Legally operating places have an AL registration number, which should be shown in the listing. You pay the tourist tax in both cases, separately from the price of your stay.

An apartment with a kitchenette works well for a longer stay, while a hotel with breakfast suits a short trip or a road trip around the island. You can browse everything on the island on Booking.comaffiliate link.

Funchal: the best choice for a first visit

Funchal is the capital and the island’s biggest tourist centre. It has the most hotels and apartments, plus restaurants, the seafront promenade and public transport, so you’ll manage perfectly well without a car. From the airport you can take the Aerobus (about 24 minutes to Avenida do Mar, ticket €6.70) or a taxi.

Within Funchal you’re really choosing between three areas. The centre and Zona Velha (the Old Town) are the oldest part of Funchal, with painted doors (Portas Pintadas), the 15th-century Corpo Santo chapel and the liveliest nightlife. Lido and Estrada Monumental in the west are the hotel district, with a promenade along the ocean and the Lido bathing complex with seawater pools, open all year. The neighbourhoods higher up the slopes give you views and quiet, but every trip back from the centre means a steep climb.

I stayed at ASPA Studiosaffiliate link, a studio with a balcony and a kitchenette close to the centre. Hotels that I or people close to me know are Pestana Carltonaffiliate link, Pestana Casino Studiosaffiliate link and Next by Savoyaffiliate link.

The downsides? It’s a city, so the centre can get crowded, and most streets climb steeply uphill. You can compare current deals in Funchal on Booking.comaffiliate link. There’s more about the city itself in my Funchal guide.

Caniço and Garajau: quiet, close to Funchal and the airport

Caniço belongs to the municipality of Santa Cruz and lies between Funchal and the airport: about 10 minutes to the airport and around a quarter of an hour to Funchal. Down by the water, in Caniço de Baixo, there are hotels right on the ocean and the Lido Galomar bathing area with a dive centre. Next door begins the Garajau nature reserve, created in 1986 (DLR 23/86/M): about 7 km of coastline (IFCN) and seven classic dive sites.

It’s a good choice if you want peace and quiet without long drives. An evening out at a restaurant in Funchal does mean a taxi or a car, though. Check deals on Booking.com: Caniçoaffiliate link and Garajauaffiliate link. Santa Cruz charges a €2 tourist tax, and in October 2026 a proposal appeared to raise it to €4.

Câmara de Lobos: a fishing harbour next to Funchal

Câmara de Lobos was the first settlement on the island (1420–1424) and is a colourful fishing harbour once painted by Winston Churchill. Funchal is a few kilometres away and the airport about 25 minutes. The municipality is also home to the Cabo Girão cliff (580 m), with a viewing platform over the drop.

Staying here is a compromise: quieter and more local than Funchal, yet still close to the city. It works if you have a car and would rather spend your evenings by the harbour among the fishing boats than in a hotel district. The downside: there are fewer hotels than in Funchal, and some places to stay sit high up on steep slopes. Compare deals on Booking.comaffiliate link, and read about the town itself in my Câmara de Lobos guide.

The west coast: Calheta, Ponta do Sol and Jardim do Mar

If you’re counting on sunshine, look west. Calheta is Madeira’s largest municipality and, according to Visit Madeira, one of the least rainy places on the island. It has Madeira’s first artificial beach, with sand from Morocco (since 2004, Visit Madeira), a marina and the Casa das Mudas arts centre. Ponta do Sol is known for the most hours of sunshine a year, and since 2021 it has had a digital nomad village with a free co-working space. Jardim do Mar and Paul do Mar have waves for experienced surfers.

The downside: Funchal is a 40–50 minute drive away, and without a car it’s hard to get around. Deals: Calhetaaffiliate link, Ponta do Solaffiliate link and Jardim do Maraffiliate link.

The north: Porto Moniz, São Vicente and Santana

The north is green, wild and noticeably rainier. According to the regional climate observatory, it rains on more than 120 days a year on the north coast, compared with about 80 in the south (1961–1990 normal, counting every day with any rainfall). In 2024 the station in Santana recorded the most rainy days in Madeira: 129. On the plus side, this is where you’re closest to the laurel forests, levadas and trails.

Porto Moniz means lava pools with the Fanal forest next door, and it’s also the only municipality on the island without a tourist tax (it plans one from 2027). You’ll find everything about the town in my Porto Moniz guide. Santana is famous for its triangular thatched houses and has been a UNESCO biosphere reserve since 2011. Nearby, at Achada do Teixeira, starts the trail to Pico Ruivo (PR1.2, 2.8 km one way). São Vicente sits by the tunnel to the south, but its volcanic caves have been closed since March 2020. In 2026 the operator is working on reopening them, with no date given (DNoticias, 25 August 2026).

Head north with a car and a rain jacket. Deals: Porto Monizaffiliate link and Santanaaffiliate link.

Read nextMadeira Airport (FNC). 🛬 The landing, the wind and getting to FunchalGetting from the airport to Funchal, transfers and what’s worth knowing about landing in Madeira.

Machico and Santa Cruz: close to the airport

The airport is in the municipality of Santa Cruz, and Machico is a few minutes’ drive from the terminal. It’s a practical choice for your first or last night, especially with an early-morning flight. The island’s discoverers landed at Machico in 1419, and the bay has Banda d’Além beach, with golden sand brought over from Morocco and a lifeguard in season. The downside: evenings here are quiet, and Funchal is about a 20–25 minute drive. Compare deals in Machico on Booking.comaffiliate link.

What about Porto Santo?

If you’re dreaming of a long sandy beach, consider a few nights on the neighbouring island. I cover the ferry, flights and places to stay in my Porto Santo guide.

Madeira tourist tax 2026

Almost every municipality now charges a tourist tax: €2 per person per night, for a maximum of 7 nights. You pay it in hotels and apartments alike, and children up to the age of 12 are usually exempt. The exception is Porto Moniz, which has only announced a tax for 2027. Santa Cruz has been charging it the longest, since 2016.

Sources: an overview of the municipal taxes (DNoticias, 12 October 2026). Funchal city council approved the increase to €4 on 1 October 2026, and the draft amendment is out for public consultation (Aviso 24792/2026), so the new rate will only apply once it’s finally approved. In Santa Cruz the increase is only a proposal so far (JM, 14 October 2026).

Car or bus?

In and around Funchal you’ll get by on SIGA buses, and the Aerobus will take you from the airport to the centre: on weekdays 18 departures between 8:30 and 22:00, ticket €6.70 (SIGA, as of 16 October 2026). If you’re staying outside Funchal or want to see the whole island, hire a car, because many trails and viewpoints simply can’t be reached by bus.

Read nextCar hire in Madeira. 🚗 Steep roads without the stressPrices, airport pick-up, deposit, roads and parking: what to know before you book a car in Madeira.

Staying with a dog

Travelling with a dog? I chose the area around central Funchal and a studio with a balcony, and I’ve covered every detail, from the flight to the vet, in Madeira with a dog.

FAQ: where to stay in Madeira

Do you have a favourite place to stay in Madeira? Tell me in the comments where you stayed and whether you’d recommend the area.

This guide contains affiliate links. If you book a stay or a car through them, I earn a small commission and you don’t pay a penny more.