The Rusty-K is an affordable and most comfortable backpackers haven. I encountered very friendly hosts, but no one who spoke much English. However, there are English speaking residents in the area. A feeling of the Old Southwest permeates this hostel in the Northwest of Argentina, an area - although one of the first settled by the Spanish centuries earlier - is only now being rediscovered by travelrs from outside the region and outside Argentina. The layout includes an expansive brick terrace in the back with a parrilla and, in season, grapes hanging overhead and comfortable, though small rooms lining one side of this open area. Within the main building, the hostel includes a roomy, rustic dining and breakfast area, along with a kitchen available for the guests' use. There arte two house computers and Wifi. The hostel is located a mere three blocks from the central plaza, where can be found an abundance of restaurants and travel/tour services. For maximum convenience, the hostel can be booked through one of the usual hostel websites. I'll be staying there again, which should tell you it has my hardy endorsement, during febrero 2012 for La Semana de Serena, the yearly music festival, .

Definitely recommend this place. Quiet (definitely not a party hostel) and clean and run by some very friendly people. There is a relaxing courtyard out the back to while away the hours if you need a break.

If you’re hungry head across the road to El Hornito for some of the best empanada’s we’ve ever had as well as some other good wholesome local dishes (this is not a tourist place and is full of locals). Or just sit outside and drink some beer with the locals.

We paid for two nights which were "ok". It is in my opinion overpriced (private rooms but sharing a bathroom). It took the shower longer than 10 minutes to start flowing.
They say they are near central plaza but all hostels are 200m from central plaza anyways. Cafayate isnt that big.
There are enough things to do in Cafayate to pay less for a hostel where you can just crash and shower. I would not recommend this hostel for people travelling with children/pets, but its quite ok if you are going with friends or in a group.
I would recommend Cafayate for Summer and then you can get to enjoy their big courtyard where you can Grill and party at night.

nice courtyard outside and use of kitchen, hot showers and friendly staff, but breakfasts not great (horrible coffee!).