There really is a great choice of fine homely Hostels in San Sebastian .

Arguably one of the best must be the Hospedaje Donosti -B&B which has received the HostelBookers Awards for Excellence 2010 - Ranked top 3 for 'Cleanliness' in Europe, located in San Marciel 33 this hostel has a great atmospher and is near the beaches.
Other top rated hostels in the city include the Pension San Juan located in Calle San Juan num.13 - 3, located in the 'Old Town' between the beaches of San Sebastian, La Concha and Zurriola (Gros) the 'surf beach'.

Another popular choice is the Guesthouse Ongi Etorri in Calle San Juan Num 3, again located in the old town. Hostal Olga located in Calle Zabaleta num 49 in Zurriola ,and arguably the nicest, most picturesque part of the city and has great sea views.
The Pension Goiko located in Calle Puerto 6 some 5-10 minutes to Kursaal and Zurriola (surf beach) and regularly gets a rating of over 90% and over by clients staying at this fine Hostel.
Enjoy low cost holiday breaks in San Sebastian from as little as 20 Euros a night