Affordable Places to Stay in Portugal: Hostels, Guesthouses & More

Portugal is one of Europe’s most wallet-friendly countries, making it a dream destination for budget travelers. With golden beaches, cobbled streets, flavorful food, and warm locals, it’s no wonder more and more travelers are choosing Portugal for long-term adventures and short escapes alike. And here’s the best part—finding cheap places to stay in Portugal isn’t just doable, it’s easy.

Whether you’re into surf towns, cultural capitals, or hidden countryside gems, Portugal offers hostels, guesthouses, and budget hotels that won’t chew through your euros. Below, I’ve rounded up some of the best budget accommodations, sorted by city, so you can make the most of your time and money.

Lisbon: Capital Charm Without the Capital Cost

Lisbon is one of the most popular cities in Europe right now—and for good reason. With stunning viewpoints (miradouros), iconic yellow trams, and neighborhoods like Alfama and Bairro Alto brimming with life, it’s an absolute must-visit.

1. Yes! Lisbon Hostel – Baixa
   Dorms from €20, privates from €60
   In the heart of downtown, this hostel is social, clean, and steps from major sights like Praça do Comércio and Rossio Square. Great for solo travelers looking to meet others.
2. Home Hostel Lisbon – Baixa/Chiado
   Dorms from €21, privates from €62
   Known for “Mamma’s Dinners,” this one feels more like a homestay than a hostel. Central, safe, and full of charm.
3. We Love F. Tourists – Mouraria
   Dorms from €22, privates from €70
   Set in a historic neighborhood near Castelo de São Jorge. Boutique style with stunning city views.
4. Selina Secret Garden – Cais do Sodré
   Dorms from €24, privates from €80
   A co-working friendly hostel with a rooftop pool, perfect for digital nomads and creatives.

Porto: Wine, River Views & History on a Budget

Portugal’s second city is a northern gem, offering riverfront views, baroque churches, and, of course, Port wine tastings. The best neighborhoods to stay in? Ribeira for scenic charm, Cedofeita for artsy vibes, and Bonfim for something more local.

1. Gallery Hostel – Cedofeita
   Dorms from €22, privates from €65
   An art-themed hostel surrounded by galleries and cafés. Just 10 minutes from Lello Bookstore.
2. The Central House Porto Ribeira – Ribeira
   Dorms from €24, privates from €70
   Set by the Douro River with postcard-perfect views. Clean and close to all the city’s best attractions.
3. Nice Way Porto – Aliados
   Dorms from €20, privates from €60
   Central location near São Bento Station, with walking tours and a cozy vibe.
4. Porto Spot Hostel – Bonfim
   Dorms from €18, privates from €55
   Quieter neighborhood, large rooms, and friendly staff.

Faro & the Algarve: Sun, Sea & Budget Bliss

The Algarve is famous for its beaches, cliffs, and stunning coastline. While some resort areas can be pricey, towns like Faro, Tavira, and Sagres offer cheap places to stay in Portugal that are just as beautiful—without the inflated prices.

1. Casa d’Alagoa – Faro (Old Town)
   Dorms from €19, privates from €50
   Set in a 19th-century building with a sunny terrace and communal kitchen. Near the marina and ideal for island-hopping.
2. Monte dos Avós Village – Tavira (Luz de Tavira)
   Studio apartments from €50/night
   Rural guesthouse perfect for couples or remote workers. Just outside Tavira and close to Ilha de Tavira.
3. Good Feeling Hostel – Sagres (Raposeira)
   Dorms from €18, privates from €45
   Free surfboard rentals and daily beach shuttles. Ideal for surfers and outdoor lovers.
4. HI Tavira Pousada de Juventude – Tavira (City Center)
   Dorms from €17, private rooms from €45
   Budget-friendly, central, and includes free breakfast. Walkable to everything in Tavira.

Budget Travel Tips for Portugal

Portugal is already kind to your wallet, but here are a few extra tips to keep costs down:

• Book early for summer stays—hostels and guesthouses fill up fast.
• Travel off-season in April–May or September–October for lower rates.
• Use public transport. Trains and buses are cheap and reliable.
• Cook your own meals. Choose places with kitchens to save on food.
• Check university towns like Coimbra or Évora for lower-cost lodging options.

Why Portugal Is Perfect for Budget Travelers

Affordable food, walkable cities, and scenic beauty—it’s no wonder Portugal is a haven for budget travelers. You can enjoy a meal for under €10, a metro ride for €1.60, and some of the most breathtaking views completely free of charge.

Plus, many accommodations feel more boutique than basic. A stay at a hostel in Portugal often includes daily activities, beautifully designed spaces, and opportunities to connect with fellow travelers.

If you’re looking for cheap places to stay in Portugal, know that you don’t have to sacrifice comfort or experience. Whether you’re backpacking, road-tripping, or slow-traveling, Portugal has a bed that fits your budget and feeds your wanderlust.

Final Thoughts

From Lisbon’s rooftops to Porto’s wine cellars and the Algarve’s golden shores, Portugal is a country made for travelers who want to see the world without going broke. These cheap places to stay in Portugal will not only help you save money but also deepen your travel experience with local charm and community vibes.

So book your hostel, pack your daypack, and get ready to fall in love with one of Europe’s most affordable and beautiful countries.