For those of you who haven’t visited, the Algarve is Portugal’s most sought after destination – and there are many good reasons why. It’s a region with an unforgettable scent of almonds, oranges and figs.
What many people don’t realise is that it’s actually a great place to visit off-season too, with 300 days of sunshine per year and an average temperature of 17°C in January (and no crowds).
We have handpicked for you our favourite places to stay in the Algarve ☀️, divided into the Eastern Algarve and Western Algarve regions.
Boutique Hotels in Eastern Algarve
Head to the eastern end of the Algarve to discover charming towns, picturesque fishing villages, and long sandy beaches. here are the best boutique hotels in Tavira, Ria Formosa, Fuseta, Cacela Velha and Castro Marim.
Pensão Agrícola – Tavira
Pensão Agrícola is a stunning six-bedroom rural boutique hotel in the Algarve that we instantly fell deeply, truly in love with. This little-known spot nestles between the historic town of Tavira and Cacela Velha, a picturesque clifftop fishing village. On the shady terrace, guests can enjoy a delicious, generous breakfast, or take other light meals by the plunge pool which is heated in the winter. Fill your lungs with the wonderful aromas that the south of Portugal has to offer – you’re surrounded by the scent of almond, carob, fig, orange and olive trees. Trust us – you’ll be in for a treat.
Companhia das Culturas is a quirky eco boutique hotel with beautiful vintage decor in Castro Marim, in the southeast Algarve. Surrounded by 40 acres of pine, cork, carob and olive trees, plus a biological garden, Companhia das Culturas is a boutique hotel in the Algarve offering a truly relaxing experience. The owners, Eglantina and Francisco, are proud of the produce of the region and their hotel is a reflection of that. It’s evolved through seven family generations and it took 10 years (it opened in 2008) to create what is today “Companhia das Culturas”.
Farmhouse of the Palms is a lovingly restored boutique B&B nestled in the lesser-known foothills of rural Algarve. This 200-year old farmhouse has been lovingly restored by husband and wife Frank and Veronique, who wanted a change from their busy city lives and fell in love with the region during the process. The spacious and serene suites are all unique, minimal yet warm, with a traditional Mediterranean feel with its white walls, terracotta floors, local stone and bespoke wooden furniture.
A Hospedaria is a gorgeous rural hotel near Tavira and Cacela Velha comprising five suites with private patios, 2.7km from Cabanas beach. It’s the new sister hotel of the awesome Pensão Agrícola, which is located just a few metres away.
This rural boutique hotel is set within the Ria Formosa Natural Park in the Eastern Algarve. Conversas de Alpendre offers a variety of stylish suites in a beautifully converted farmhouse, alongside a self-contained apartment which includes an awesome tree house. Breakfast is organic and sourced from local farms, and it’s served on the terrace surrounded by fruit and olive trees for a truly back to nature experience.
A boutique hotel located in the Eastern Algarve surrounded by a lush pine forest, overlooking the sea. The 40 bright and airy suites all come with a separate living room complete with sofa bed (perfect for children), and a kitchenette. There’s a mix of cultural and gastronomic activities for the whole family to enjoy.
A tranquil retreat with a garden and two swimming pools, set among an orange grove in the sunny Algarve, a 10-minute drive away from the beautiful Fuseta beach. There’s also a wide range of activities for both adults and children, including visiting a nearby farm and meeting the resident animals.
This four-bedroom guesthouse is located in Olhão, a quirky and authentic fishing town only a 15-minute drive from Faro. The owners Lara and Dário have created Casa Céu with a lot of love. The whole house is beautifully decorated, the rooftop terrace is stunning and the local islands of Culatra, Armona and Farol are an Algarve gem.
What used to be known to locals as ‘the ugliest building in Faro’ has been brought back to life as a three-storey building with six apartments available to rent. Inspired by the 1970s everything has been impeccably renovated in full respect of its original Mid-Century Modern Design. Each apartment comes with a kitchenette, a private balcony, a shared garden patio and a rooftop to sunbathe and enjoy panoramic views of Faro (outdoor shower included). A truly unique place to stay in Faro.
The Western Algarve is a great option for beach lovers with it’s cliff-edged beaches and tiny coves. The laid back towns of Lagos and Sagres are perfect for those who want a little bit of action. Costa Vicentina is all about its sleepy villages and spectacular wild beaches. a wonderful base for surfing, walking, cycling, surfing, canoeing, and birdwatching. or maybe just chilling.
Casa Mãe – Lagos
Casa Mãe is a gorgeous boutique hotel in the Algarve tucked away beside the ancient city walls of Lagos, near a long sandy beach. It features 30 rooms spread across three different buildings: five elegant suites in the beautifully restored 19th-century estate house (aka Mother House), 22 rooms in the Jogo de Bola building, where cosy minimalism perfectly blends with traditional Algarvian architecture, and three rustic cabanas for an outdoorsy experience by the fig-scented garden.
Praia do Canal Nature Resort – Aljezur, Costa Vicentina
This five-star spa and wellness retreat hotel is set amidst the extraordinary wild landscape of the Costa Vicentina Natural Park, with the finest preserved stretch of European coastline. There are 56 rooms, an outdoor infinity pool, an heated indoor swimming pool, two massage rooms, an hammam (Turkish bath), a 90 degrees Celsius Finnish sauna, a 70% bio sauna, an indoor and an outdoor relaxation zone, a cold plunge tank and an ice water bucket for a truly rejuvenating experience.
Monte da Vilarinha – Carrapateira, Costa Vicentina
Located in the south of the Costa Vicentina Natural Park, Monte da Vilarinha enjoys commanding views over the surrounding valley and it’s within reach of the rugged coastline and its beautiful wild beaches. This peaceful boutique stay offers a range of accommodation types from a studio through to three-bedroom houses, all with a kitchen and access to the property’s swimming pool. A locally-sourced breakfast is served daily by the poolside restaurant, and there are daily yoga classes. The ideal option for families and those seeking outdoor adventures such as surfing, canoeing, cycling and walking.
Muxima is an eco-friendly guesthouse perfectly nestled in a green valley near Aljezur. Here, owners’ Paula and Jelle want to share their great love for wild nature and good food with their guests. The houses are beautifully decorated with items collected from many travels and each room has its own, unique style, and are all surrounded by lush green gardens. Highlights include morning yoga classes, a natural swimming pool, a mostly organic vegetarian breakfast feast and endless adventures on the property climbing trees, swinging ropes or exploring the forest. There’s also a shared living room with a library and a fireplace, to be enjoyed with Portuguese, organic natural wines. There’s plenty of space to chill, run around, play and take a dip.
A four-star boutique hotel in the Western Algarve town of Sagres, offering 144 rooms and family-friendly one or two bedroom suites with kitchenettes. Facilities include a restaurant, a bar, a swimming pool with magnificent ocean views, a heated indoor pool, a spa, and a gym. Meanwhile, the children can enjoy themselves at the kid’s club, going biking or taking surf classes at the hotel’s own surf centre.
So there you go, those are what we consider to be some of the Best Boutique Hotels and Guesthouses in the Algarve right now. We hope you like them as much as we do.
If you are interested in exploring Costa Vicentina, you might also be interested in our article Places to Stay in Costa Vicentina in the Algarve. It offers a selection of our favourite boutique hotels, holiday homes and villas in Costa Vicentina, alongside some recommendations for beaches, restaurants and activities.
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