This old minshuku was recently converted into a hostel by the reliable J-Hoppers team. There are spacious, cabin-style bunks and private Japanese-style rooms, all with shared facilities, which include three small onsen baths that can be used privately. There's free rice porridge in the morning, cup noodles for sale, cooking facilities, coin-operated laundry machines and a social vibe.
It's located at the top of town, up the road from Tsubo-yu.