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Unlike most of the rest of Spain, Madrid is not a particularly cheap place to sleep. Hotels in Madrid are as expensive as hotels in many of Spain’s northern neighbors, so it’s good that there are loads of hostels in Madrid that allow the budget traveler to enjoy the famous party lifestyle without having to sleep in the park.

With over 3 million people, Madrid is both the capital and the country’s largest city. It’s also very spread out, at least for locals. For travelers the city is actually fairly compact, but this means you have to pay special attention to the location of your Madrid hostel. There are properties all over the city that are hostels, or get classified along with the hostels. Actually, most cheaper hotels in Spain call themselves hostals even though they are not catering to the backpacking crowd and don’t have affordable dorm rooms. The word “hostal” means “inn” in Spain, so pay attention to that last vowel.

The group of streets in Central Madrid known as the Gran Via is the center for luxury hotels and shops, but it’s predictably short on cheap beds. It’s just as well since the best central neighborhoods are south of there anyway. The Puerto del Sol is the official center of the city, and the country as well, and the streets radiating out from there are home to loads of good places for budget travelers. The wildest nightlife (that lasts well into the morning) in the center of the city can be found in the neighborhood directly to the south of the Puerto del Sol, so this is a great area if you don’t want to pay a fortune for a taxi home at 7 a.m.

The RC Miguel Angel is just 150 meters from the Puerto del Sol. The have beds in rooms that range from 4-bunks to 8-bunks starting around €18 per night. There are tapas bars and small restaurants all through this district so this central location is worth paying a few extra Euros for.

The Hostal Metropol - Equity Point Madrid is also very close to the Puerto del Sol. They have 6-bed dorm rooms starting around €17 per person per night with a bathroom in each room. They also offer private twin rooms starting around €25 per person per night, also with an en-suite, and the price here includes breakfast.

Many of the Madrid hostels near the center also organize pub-crawls and other scheduled outings to the popular attractions. Since English isn’t widely spoken in Madrid these activities can be a great way to do some cool stuff without having to worry about the language barrier if you aren’t fluent in Spanish.

As mentioned, Madrid is a sprawling city and there are places in the suburban areas or near the airport that will advertise that they are a 10-minute Metro ride to the main sights. You can save money by staying in such a place, but you’ll likely regret it when you realize you are spending a couple hours each day going back and forth. The center of the city isn’t too expensive so as long as you book early enough you’ll be able to get a great location for only a bit more than the far-out places.

Hostels in Spain (Madrid)