Where to Stay in Madrid in 2023 (Best Areas & Places)

9 Best Neighborhoods & Areas to Stay in Madrid

Even though Madrid is the largest city in Spain, it’s surprisingly easy to get around without a vehicle. This is true whether you’re staying in Madrid’s city center or a neighborhood on the outskirts of the city. With the help of public transportation, Uber, and some comfortable walking shoes, it’s effortless to reach all of Madrid’s top districts. 

Retiro

👉 Best Area For Chill Ambiance & Inviting Green Spaces | ✨ Best Retiro Hotels: Petit Palace Lealtad Plaza • Ayre Gran Hotel Colon • Claridge Madrid

Most people think that a capital city like Madrid would be all hustle and bustle without any relief. However, many of the city’s neighborhoods are actually relatively calm, such as Retiro. Located next to Madrid’s largest greenspace, the Retiro district is a popular place to stay in Madrid for families. The park alone is an endless source of fun and cheap outdoor activities. 

There are lots of different accommodation options in Retiro that can house solo couples or families of 5+. The main drawback of staying in Retiro is that it’s a little bit of a hike from the central neighborhoods of Madrid and all of the attractions there. Additionally, hotels tend to be a little more luxurious and pricey in this neighborhood. 

Pros of Staying in Retiro Neighborhood:

• Very family friendly neighborhood
• Calmer atmosphere than the busier areas of Madrid
• Lots of green spaces
• Many hotels

Cons of Staying in Retiro Neighborhood:

• Hotels can be expensive
• Few attractions besides the park

Centro

👉 Best Area For History, Culture, & Affordable Hostels | ✨ Best Centro Hotels: Hostal Aresol • Ok Hostel Madrid • Plaza Mayor Suites & Apartments

Located in Central Madrid is the obviously named Centro neighborhood of Madrid. This district is in one of the most favorable locations in the city because it is surrounded on all sides by Madrid’s other best neighborhoods. 

Sol, Lavapiés, and Salamanca are all conveniently right next door. If you’re trying to figure out where to stay in Madrid for easy access to the rest of the city, it’s going to be Centro. 

Inside this neighborhood, you’ll find tons of affordable hostels and high-quality tapas bars to choose from. The only problem with Centro is that there are actually more hostels than traditional hotels or Airbnbs. If you’re looking for a more private experience in Madrid, Centro might not be the best option for you. 

Pros of Staying in Centro Neighborhood:

• Within walking distance of other neighborhoods
• Many excellent tapas bars 
• Great for first-time visitors 
• Lots of affordable hostels are available
• Several historical attractions nearby

Cons of Staying in Centro Neighborhood:

• Fewer options for hotels or Airbnbs 

Ibiza

👉 Best Area For Foodies | ✨ Best Ibiza Hotels: Novotel Madrid Center • La Llave De Madrid • ICON Wipton 

That’s right, Ibiza isn’t just a Spanish party island in the Mediterranean sea, it’s also one of Madrid’s major neighborhoods. Located just north of the Retiro district and right next to the city’s giant El Retiro Park, you’ll find Ibiza. 

The neighborhood for all things high-end food and drink, it’s where to stay in Madrid if you want to get acquainted with Madrid’s best culinary offerings. 

Restaurants like KultO, Sazón-arte, or Restaurante Castelados will dazzle you with their creative food and variety of wines.  Just keep in mind that these places tend to be on the more expensive side. 

The other thing to consider is that Ibiza is located pretty far from the city center on the opposite side of Retiro Park. You’ll either need to take a 45-minute long walk to get to central Madrid and its attractions or hop on public transportation. 

Pros of Staying in Ibiza Neighborhood:

• Lots of interesting restaurants to choose from
• A variety of bars around
• Removed from the touristy areas of the city

Cons of Staying in Ibiza Neighborhood:

• Few hotel options
• Must take public transportation to attractions and other neighborhoods

Malasaña

👉 Best Area For Incredible Restaurants & Lively Nightlife | ✨ Best Malasaña Hotels: Vincci Via • Dear Hotel Madrid • Riu Plaza Espana • Arizonica Suites

Malasaña is where to stay in Madrid if you’re not quite sure what you want yet. In general, it’s your best bet for having a good time no matter what type of visitor you are. There are a lot of things that make Malasaña a great place to stay in Madrid. 

The neighborhood has some of the best Madrid restaurants, with a variety of cuisine like sushi at Okashi Sanda and Ethiopian food at Etíope Nuria. If you’re a digital nomad, there are a bunch of adorable cafes and little bakeries to work the day away in. Malasaña also has one of the most high-spirited nightlife scenes in the entire city. 

While places like Plaza de España Square are located right near Malasaña, most of the city’s big tourist attractions aren’t in this neighborhood. Additionally, accommodations tend to be a little more pricey around this area. 

Pros of Staying in Malasaña Neighborhood:

• Plenty of hotels to choose from
• Lots of great restaurants with a variety of different cuisine
• Lots of cute cafes and sweets shops around
• A vibrant nightlife scene

Cons of Staying in Malasaña Neighborhood:

• Few attractions nearby
• Accommodations can be expensive

Sol

👉 Best Area For Central Location Near Attractions | ✨ Best Sol Hotels: Hotel Moderno Puerta del Sol • Hostal Patria Madrid • Hotel Liabeny • B&B Hotel Madrid Centro Puerta del Sol

Sol is a favorite neighborhood among newbies to Madrid and it’s easy to understand why so many people love this area. Sol is considered downtown Madrid, which reaches from Puerta del Sol to the Royal Palace. It’s one of the more centrally located neighborhoods in Madrid, with Centro on one side and Malasana on the other. El Retiro Park is also only a few blocks away and well within walking distance. 

Within the boundaries of the Sol neighborhood, you’ll find a bunch of different top tourist attractions such as Plaza Santa Ana, Puerta del Sol, and the Royal Palace. Most of the city’s tourist attractions that aren’t located in this neighborhood are still very close by. 

Sol is famous for its array of simultaneously affordable and mouth-wateringly delicious restaurants. Some of my top recommendations for low-cost eateries in Sol include Restaurante D’Corazon and Restaurante Rosi La Loca.  

Pros of Staying in Sol Neighborhood:

• Lots of major attractions nearby like Puerta del Sol and the Royal Palace
• Centrally located 
• It’s possible to find a cute boutique hotel, hostel, or more modern hotel 
• Walking distance to other neighborhoods
• Lots of affordable, delicious restaurants nearby

Cons of Staying in Sol Neighborhood:

• Popular area with lots of tourists
• Accommodations sell out fast in the high season

Lavapiés

👉 Best Area For Budget Travelers | ✨ Best Lavapiés Hotels: Artrip Hotel • Ibis Budget Madrid Centro Lavapies • Reina Sofia Acogedor 

If you’re traveling to Europe on a budget, Lavapiés might be a terrific option for where to stay in Madrid. While most of Madrid’s neighborhood will cost you a pretty penny, the accommodations and restaurants in Lavapiés are surprisingly affordable. This makes it a popular neighborhood with young people who are trying to save a buck and want to meet other travelers along the way. 

Many solo travelers flock to this Madrid neighborhood for its premium nightlife scene. There is a long list of different bars to try around this area. Including unique lounges like the La Noche Boca Arriba piano bar and laidback watering holes like La Huelga de Lavapiés pub. 

The other convenient thing about Lavapiés is that it’s sandwiched right between Centro and El Retiro. Making it simple to get basically anywhere else in the city on foot or with a trip to the metro station. 

The only borderline annoying part about staying in this neighborhood is that it gets very busy. It might not be the best choice for people who are seeking peace and quiet in Madrid. 

Pros of Staying in Lavapiés Neighborhood:

• Lots of low-cost budget hotels 
• Many delicious, affordable places to eat
• An endless list of excellent bars
• A great option for solo travelers 
• Centrally located between other cool neighborhoods

Cons of Staying in Lavapiés Neighborhood:

• Few attractions
• Busy

Salamanca

👉 Best Area For Fashion & Shopping | ✨ Best Salamanca Hotels: Velazquez 45 by Pillow • ICON Embassy • TÓTEM Madrid, a Small Luxury Hotel of the World • The Pavilions Madrid Hotel  

That old saying “you get what you pay for” definitely rings true in the Salamanca neighborhood of Madrid. Even though it’s one of the pricier places to stay in Madrid, it’s also one of the best. If you want to stay in the lap of luxury on a trip to Madrid, you’ll probably want to book a hotel in the Salamanca district. 

There are practically endless high-end hotels to choose from such as TÓTEM Madrid and ICON Embassy. The opulence doesn’t stop there, though. There are 5-star restaurants, a range of nightlife options, and tons of upscale shopping around Salamanca. There are also top tourist attractions including the National Archaeological Museum and Las Ventas, Madrid’s iconic bull ring. 

Visitors who want to stay in Salamanca should keep in mind that it is one of the most expensive neighborhoods in Madrid. Set a budget and stick to it when you’re staying in this district or you could end up with an empty wallet. 

Pros of Staying in Salamanca Neighborhood:

• Lots of nice, luxury hotels
• 5-star dining establishments
• A range of different nightlife options from pubs to cocktail bars

Cons of Staying in Salamanca Neighborhood:

• Pricey

Barrio de las Letras

👉 Best Area For Museums & Bars | ✨ Best Las Letras Hotels: Soho Boutique Congreso • One Shot Prado 23 • Catalonia Plaza Mayor

One of the best things to do when visiting a new city is to take a gander at all of its museums. It’s the ideal way to take in a city’s story. Luckily, Madrid has a lot to offer in this department. Especially in the neighborhood of Barrio de las Letras. 

This Madrid neighborhood is located in a very optimal location of the city center. Right between Centro and Sol, you’ll find some of Spain’s most famous museums like the Prado Museum, the Museum of Illusions, and Lope de Vega’s House Museum.  

Once you’re done getting to know Madrid’s history and cultural influences at the museums, Las Letras has plenty of places to eat and recharge. Some of my favorites are Casa Alberto and El Barril de las Letras. 

Then, the party can continue after the sun goes down. There are tons of local bars to choose from. Salmon Guru and Lovo are to send your night in the right direction. The neighborhood’s combo of activities, restaurants, and nightlife makes it one of the most popular places to stay in Madrid.

Pros of Staying in Las Letras Neighborhood:

• A variety of places to eat
• Lots of different bars and clubs
• Cool museums and historic sites
• Easy to find a cute boutique hotel 

Cons of Staying in Las Letras Neighborhood:

• Crowded, especially from June to August

Atocha

👉 Best Area For Artsy Vibe & Families | ✨ Best Atocha Hotels: Only YOU Hotel Atocha • Rafaelhoteles Atocha • AC Hotel Atocha by Marriott 

If you’re looking for a neighborhood in Madrid that will offer a chill atmosphere, you’ll find it in Atocha. It’s one of the more laidback, residential areas of the city. That’s why it’s one of the best places to stay in Madrid if you’re visiting with young children or just prefer a less crowded atmosphere.

This neighborhood has a cute vibe and is the type of place where you’ll want to spend all day aimlessly wandering. There aren’t that many sites to see in Atocha, yet it still feels like there are enough idle activities around to fill your day. 

One of the coolest things I saw in Madrid happened to be located in this neighborhood – the Madrid Atocha Train Station. I know what you’re thinking; why would you ever want to visit a train station? Well, this one happens to have a thriving, lush greenhouse inside that looks almost otherworldly. Even if you’re not staying in this neighborhood, you should make a trip out to catch a glimpse of this one-of-a-kind attraction.

Pros of Staying in Atocha Neighborhood:

• A quieter, residential option
• Great for families
• A cute, trendy overall vibe 
• Lots of inexpensive, yet top-quality, restaurants

Cons of Staying in Atocha Neighborhood:

• Fewer hotels to choose from 
• Not that much of a nightlife scene

Tips for Staying in Madrid

Check The Weather

Weather in Madrid can range from scolding heat to pouring rain. You’ll want to know what you’re getting yourself into beforehand, so make sure you look into the best season to visit Spain for your preferences. 

Avoid Eating In Plaza Mayor

Everyone who spends time in Madrid has to spend a little time in Plaza Mayor, however, you should avoid eating around here. Since it’s a major tourist attraction, the restaurants around Plaza Mayor are more expensive. Plus, the food isn’t as good as most of the other spots in Madrid. 

You can find way better restaurant options right outside of Plaza Mayor, like Restaurante Rosi La Loca and Alhambra.

Walk Everywhere Or Take Public Transportation

Driving in Madrid can be a nightmare, especially if you’re not experienced with the skinny Spanish streets. 

You should stick with walking whenever you can or take the local public transportation. It runs to almost all areas of the city. When all else fails, rideshare apps like Cabify, Lyft, and Uber are readily available. 

👉 Read Next: 17 Best Day Trips from Madrid

Research Travel Insurance for Spain

Madrid has a low crime rate, but bad things can happen no matter where you’re going. Imagine how stressful it would be to miss your flight, get injured abroad, or even get stuck in a natural disaster. 

Since the world is unpredictable, consider whether you need good travel insurance for Spain before you stay in Madrid.  

Dress To Impress When Going Out For The Night

The locals and visitors alike in Madrid share this general consensus of dressing to the nines on a night out. Even if it’s just going to grab dinner! This isn’t the destination to go casually. Even in a dressier outfit, you’ll fit in at most restaurants in Madrid. 

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Try The Local Specialty Of Tinto de Verano 

When most people think about what cocktail they want to sip on with their meal in Spain, their mind immediately jumps to sangria. However, if you’re in Madrid, its distant relative called ‘Tinto de Verano’ is far more common. It’s kind of like an alcoholic Arnold Palmer made with 50% lemonade and 50% wine. 

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FAQs About Where to Stay in Madrid

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That’s it for my guide on where to stay in Madrid. What Madrid neighborhood are you leaning towards? Before you start packing up your bag for Madrid just yet, make sure you check out our complete Spain packing list. Have fun in the Spanish capital!