Accommodation rates run high in London. Many tourists choose to stay in the West End, amongst London's theatre district and some of the city's top attractions, but if you're looking for a budget stay, you'll probably have to look elsewhere. The Bayswater neighborhood is also a quiet, safe and relatively affordable place for families to bed down. And Soho is a fun place for revelers. Hostels, however, are scattered throughout the city and can be found near most of the major tourist attractions.
It's always a good idea to book your hotel in advance, especially since travelers flock to London throughout the year. Also, make sure your hotel is in walking distance to a Tube station, which can help cut down your taxicab costs.
East End
A little east of London's well-known tourist attractions, East End is nonetheless a good place to stay if you're hunting for a moderately priced hotel and some interesting culture: Bangladeshi Brick Lane is located here, and the Shoreditch and Spitalfields markets are nearby.
Bayswater
Visitors looking to stay in the attraction-packed West End (but not wanting to spend a fortune to do so) might want to look in the Bayswater area. But keep in mind that most of the accommodation options here are converted townhomes—many of which have several-story staircases and no elevators.
Soho
At the meeting point of shops, theaters, and trendy bars, Soho is an ideal place for party-hearty travelers to stay. Eurocheapo calls Soho "a good launching pad and a fun—if noisy—place to dine, dance, and bed down." But because it's such a happening place to stay, room rates run high.
Knightsbridge, Kensington, and Chelsea
Georgian town homes and gated gardens (many of which you need a special key to enter) fill the elegant Royal Borough of Kensington and Chelsea. Even the much beloved Princess Di once lived here—though in a palace, not a town home—but still, you can imagine the area's class. The majority of hotels here are high on sophistication and high on price.
What's nice about staying in this western London area is the proximity to the city's top attractions, like the Natural History Museum, Hyde Park, Harrods, and the Victoria and Albert Museum, among others.
Earls Court
Located west of the city center, Earls Court is right on the edge of a cluster of wealthy, well-to-do neighborhoods like Kensington and Chelsea. But here you can find a cheap (at least cheap for London) place to stay and still be in the thick of city life.
Bloomsbury
Bloomsbury might be one of the best places to book a budget hotel in central London. The area especially attracts those all right with homey bed and breakfasts or trendy hostels, and you won't be sacrificing location. Within a short walk of your Bloomsbury hotel, you'll find the British Museum, the Inns of Court and the shops of Soho.
Near the Victoria and Paddington tube stations
Near the Victoria tube stop, you might find a deal—a steal, even—but you'll pay for it in ambience. Although you're still a quick tube ride from most of London's top attractions and even a 10- to 15-minute walk from Buckingham Palace, the hotels clustered around Victoria tube station are severely lacking charisma. Still some travelers might be okay trading charm for price; most hotels range in price from the pound equivalent of about $150 to $250 a night.
Around the Paddington station—former home of a famous teddy bear by the same name—you will find another cluster of hotels that charge relatively reasonable rates. And not only is Paddington a Tube station, which gives you easy access to other areas in the city, but it's also a national railway station with trains that will transport visitors to other popular English towns like Oxford and Bath.
