The big difference on whether to say hostel or hostal is in the translated definition of the words. See, “hostel” isn’t a well known word in the Spanish language, at least in South America.
The closest word to “hostel” is hostal, which basically means a budget hotel. Within our definition as English-speakers, a budget hotel is basically what it sounds like: a low-cost accommodation hotel, or motel.
Within the realm of owning and operating a hostel, you run into some pretty big problems when it comes to defining what type of business you actually run. This is important to the small businesses office, or the entity that controls the regulations of small business ownership within the city. Between hostel or hostal, you’re forced to choose “hostal” because the word hostel isn’t very common, and doesn’t have a definition.
We understand a hostel to be a fun, social, and a hangout for the backpacker or traveler. When you end up having to place a name like “hostal” in your name, suddenly you become a budget hotel in the eyes of the locals.
This brings along the clashes of the customer bases, the bad reviews (for not having a telephone in the rooms, for example), or for not being a good place for families or older people.
Think about this next time you stay at hostels anywhere around the world!
–Plantas y Blanco Hostel