I really liked this place. The hostel (though B&B may be a better term) is a big traditional Valparaiso house near the top of one of the city's many hills. (There is a great view of the whole sweep of the bay just yards away from the front door.) I stayed in two different rooms, one large and one small; both were simply but imaginatively decorated, most of the decorative effort having gone into the large common area, dining room and kitchen. Throughout the owners have managed a nice counterbalance of traditional structure and contemporary design.
As others have said, the couple who run the hostel are friendly, welcoming, helpful and willing to share ideas and suggestions for what to do in Valparaiso, including an interesting-sounding culinary walking tour and dinner run from the hostel. (I didn't take advantage of it so can't comment on it.) Another friendly and welcome feature of the hostel is a honour system that allows you to help yourself to drinks and snacks if you suddenly find yourself thirsty or peckish.
Valparaiso has tons of character. Hostel Portobello complements the city well and is a good base from which to explore it.
