My wife and I have recently spent our third holiday in Madeira. This time we took the decision to stay in a Hotel in Madeira town itself instead of one of the large Hotels 2km out of town in the Hotel district.
We stayed at the Residencial Mariazinha in the Zohna Vehla (old town) a small 10 bedroom Hotel, bang in the centre of the old town and restaurant area. We booked the Hotel directly from their website, and had no problems at all. The Hotel staff, especially Ms Ligia Pinto were very cheerful and eager to help. I found the Mariazinha to be excellent value for money.
As we spend our days out walking the Levadas and mountains, our need is for a simple, clean, no frills accommodation with a good breakfast. A hotel with all facilities, pools, sports suites etc is all very well, but if they are not used, they are a waste of money. Certainly eating in a Hotel restaurant can vary greatly from excellent to awful, but a bed and breakfast enables you to get amongst the real restaurants and eat what the locals eat. What is the point of travelling hundreds of miles to another country and still eat the same English food.
The breakfast at the Mariazinha was wholly adequate with fruit, cereal, meat and cheese, yoghurts and wonderful bread and rolls, pastries from the Bakery right next door. There was no cooked food, the coffee was excellent, the tea – ask for more than one teabag in the pot!!
The rooms are larger than normal with high ceilings, a larger than average satellite TV and simply furnished. The small Hotel exits directly onto the street, the Rua de Santa Maria. This is one of the oldest streets in Funchal.
We sometimes found the noise at night and early morning to be a little intrusive but not enough to be a problem. There are no views from the rooms, but there is a small outside area and terrace.
There is also a small bar.
The biggest bonus was the position of the Hotel, the best restaurants were literally on the doorstep, the Cable car to Monte was about 5 min away and the town centre and harbour was only 10 min flat walk away.

The Residencial Mariazinha is superbly located in Funchal old town at 155 Rua da Santa Maria, almost opposite the well known O Jango restaurant. Numerous other excellent restaurants are within 100 metres of the Residencial Mariazinha. The Rua da Santa Maria is very narrow. Whilst the hotel has no car parking facilities, on-street parking nearby seemed possible in March, but probably difficult in busier months. There is a large multi-storey car park about 300 metres away. Sometimes the part of the street containing the Residencial Mariazinha is blocked to motor vehicles. A taxi rank is within 100 metres of the hotel. It is also an easy walk to the cable car and main bus stop areas. The airport bus stops near the market, which is at the western end of Rua da Santa Maria.

The Residencial Mariazinha is very well appointed, offering 9 rooms and one suite. Polished (non-slip) wooden floors are much in evidence, with tasteful furniture. We had the 3-room suite on the top floor, consisting of lounge, bedroom and bathroom (with jacuzzi), very well and comfortably furnished. There are no lifts.There was a small balcony with partial view of the sea. Telephone and cable TV are provided. We saw some of the other rooms, which were large and furnished to a high standard, with en-suite bathrooms, but no balconies. Plenty of hot water was available at all times. Quiet air conditioning was fitted, with remote controls (and they worked!). None of the rooms had refrigerators, and no self-catering facilities were provided (not even a kettle for coffee etc).

The breakfast room was pleasant, with the option of breakfasting outside on the adjacent terrace. Space was tight on some of the tables. The breakfast (included in the price) was good (fruit juice, cereals, fresh fruit, ham, cheese, tomato, excellent bread rolls, toast, jam, tea, coffee). The only flaw was the low-quality of the fruit juice.

The staff were extremely friendly and helpful. However, the reception desk was not always manned. You are provided with a key to the main hotel door to let yourself in when the reception was closed.

In short, all-in-all, quite the best hotel in Funchal. We will be going again.