I stayed at Hostal Austria for two nights last month. The location is pretty good, right across from Plaza Nueva, and access to public transportation and sights is excellent. The staff is friendly and you are provided with a key to the front door, which means you can come and go as you please.

Having said that, I cannot recommend the place to anyone. The street the hostal is on (Gomerez) leads up to the Alhambra which means there is traffic coming and going there from very early until late every day. Also, there is a bar that plays very loud music right across the street, and while it is only semi-bothersome when the bar's door is shut, people open and close it all night so you can't escape it (the room itself is not very well insulated noise-wise as it is). Finally, my wife found the mattress hard as a rock and the bathroom really small.

Yaron