I absolutely would recommend this place for 1-2 people. I stayed here by myself for 2 days and it couldn't have been a better choice. Hugo was in touch well before to make arrangements. His friend Joaquim was at the flat at the appointed time and carried my suitcase to the 3rd floor up the steep, narrow steps. Much appreciated! He also arranged to take me to the airport, which was convenient as the apt is tricky for cabs to find.
Don't be fooled by the entry from the street. The apartment is extremely modern, well-appointed, comfortable and quiet at night. Air conditioning and heat work great. View from the balcony is lovely - overlooking the cobbled-stoned streets, rooftops and the water.
The neighborhood is the old town with narrow, charming streets, restaurants and shops. Good location. Lots of restos with Fado. When you need a change from traditional Portuguese food, recommend 'Os Gazeteiros' on Rua das Escolas Gerais 114 - innovative, light French food. All around super experience. I will definitely return to the Alfama Blue House. Thank you Joao, Silvia and Joaquim for making my stay memorable!