Stayed in Kyoto, Takayama, Ito. Really recommend this hostel chain in terms of quality to value. Each hostel has its own taste. I can recommend the hostel in Ito. Its in a 100 year old cultural landmark with onsen (hot spring) on its premises.
Gojo Guesthouse (Kyoto)
If you want to be taken back time, Gojo guesthouse is a great place to be in Kyoto. Really down to earth staff and creaky wooden floors and tatami mats. Its a classic place. (NB if your into the modern minimalistic clean hostel this wont be your cup of tea).
Nagai Youth Hostel (Osaka)
This hostel based in the Yanmar stadium home of the Cerezo Osaka Football Club. For those of you who want a local feel rather than the hustle and bustle of central Osaka its a great hostel to be in. Good takoyaki and okonomiyaki shops close by and the facilities of the hostel are high quality and clean.
The only place where one can stay on a budget in Koyasan (November 2014). The facilities are very clean and one can get to experience a stay in a capsule style room (a bit bigger than a normal capsule hotel). Its owned a married couple who like to travel, so make sure to send them an email to check they are open during the time when your visiting Koyasan. The husband used to live in London and he’s hobby is DJ-ing and has done big events in Osaka in the past.