A great option is the peaceful, clean and modern Pachamama Inn (Las Orquideas Chaskatika s/n, tel. 084/21-1141, hostalpachamamainn [at] hotmail [dot] com, US$60 s, US$80 d, plus US$20 for a Jacuzzi in your room). This hotel comes with all the trimmings: 24-hour hot water, a money exchange, tourist information, and a restaurant. Strangely enough, all rooms are equipped with mirrors on the bathroom ceiling.
A more mediocre hostel in this price range is HanaqPacha Orquideas (Las Orquideas s/n, tel. 084/21-1027, US$70 s US$90 d). It is clean and simple, and breakfast is included. However, the bathrooms tend to be quite small.