The backpackers’ best is Spanish-run Albergue Las Salamandras (Sector los Pinos s/n, tel. 067/211865, www.salamandras.cl, US$11–15 pp with kitchen access), on piney grounds about two kilometers southwest of town on the old airport road. Most rooms in this attractive building, with large communal spaces, are dormitories, but there are a couple of doubles. Camping (US$6.50 pp) is also possible.

Cheerful Residencial Mónica (Eusebio Lillo 666, tel. 067/234302, US$11–15 pp with private breakfast) has shared and private bath options, but too many beds nearly cover the floors in some rooms.

Hospedaje Gladys (General Parra 65, tel. 067/251076, patagoniagladys [at] hotmail [dot] com, US$13–20 pp) is quiet, well-located, spotless, and tobacco-free, though the shared-bath rooms have too many beds and the lurid red bedspreads are distracting. Rates include cable TV; breakfast (US$3.50 extra) is worth the price.

So-so Residencial Puerto Varas (Serrano 168, tel. 067/235931, US$28 d with shared bath) hasn’t kept pace with the better budget places, but will do in a pinch; breakfast costs extra. Hostal Bon (Serrano 91, tel. 067/231189, hostalbon [at] hotmail [dot] com, US$31 d) has plain but comfortable accommodations with breakfast.