I just returned from a short trip to New York City, and I have a few recommendations for the budget-conscious traveler. Well, one recommendation, really: the East Village. I suggest the East Village primarily because it is home to the East Village Bed and Coffee, a nine-room inn located on Avenue C between 7th and 8th Streets in Alphabet City. Rates range from $100 to $130, double occupancy. The B&C is a guesthouse rather than a hotel, meaning you'll share a bathroom, fully stocked kitchen, and living room with the other folks on your floor. A setup like this isn't for everyone, but the inn is cute, cozy, friendly (Anne, the innkeeper, will suggest local restaurants for every taste and pocketbook), and, in a city with average hotel rates north of $200, an undeniable value. For students and families, I think the B&C could be a particularly good option.
The East Village is also chock full of inexpensive restaurants spanning all cuisines. Noisy, welcoming brunch joints like the 7A Café are especially plentiful, as are tiny, comfortable, dimly lit spots such as the Crooked Tree Creperie (212-533-3299) on St. Mark's. This stretch of St. Mark's, between Avenue A and 1st Avenue, is quite literally lined with small, inviting, reasonably priced restaurants.
Perceptions of the East Village, particularly Alphabet City, may be skewed by the area's history as an unruly haven for punk and counterculture types. This legacy is tangible today in the neighborhood's record shops, tattooed wait staff, and grungy bars, but present as well in the prevailing "anything goes" attitude that allows for such wild and varied restaurants and businesses. However, the East Village is nearly 20 years removed from its "unsafe" days, and for better or worse, the area is safe and pleasant. This makes for a fun 12-minute walk from the B&C to the subway at Astor Place or 8th and Broadway, and from there the rest of the city is yours.