On a densely wooded hill overlooking the castle town of Uwajima, is one of Shikoku's best budget accommodations, Uwajima youth hostel. Run by the well-informed Asada-san, this youth hostel is a bit of a trek from the JR station, but you'd be hard pressed to find a more beautiful locale anywhere else in southern Ehime.
Upon checking-in, we (my wife Noriko and I) were immediately impressed by the huge, clean building and the big welcome we received from Asada-san. Also, being that it's situated on a hill, isolated from any other structures, the only sounds that greet you are the birds; the only smells are the flowers. The facilities include a rec room complete with a ping-pong table, a couple of lounge areas and a tree house outside! Though the building is a bit old and the decoration a bit tacky—I would describe it as old-lady retro (copyrighted)—it's the best budget accommodation option in Uwajima.
After exploring the building a bit, we ended up taking the advice of our lovely host and visited an amazing izakaya (Japanese dining bar). Gaya, located on a small street near downtown, serves the local specialties tai-meshi, jakoten, and nice half-and-half brews in a really fun environment. After filling our bellies we walked through the largely deserted shotengai (covered shopping arcade) and headed back up the hill towards the hostel.
The path to get there is one of the hostel's best points. Flanked by both a Buddhist temple and a Shinto shrine, the lighted walkway creates an atmospheric entrance to a small park (abutting Uwajima youth hostel) with a jaw-dropping view of Uwajima.
The hostel has a special rate of ¥2,100 for foreigners (non-Japanese) who wish to stay in a dorm room (either male or female). Singles run ¥3,500, twin rooms for ¥7,000. This is a very fair deal indeed. Asada-san also serves a mean Japanese breakfast for ¥600.