I had a good 3 nights stay Maria's Palácio de Sant'Anna (room #14), which serves as a student residence (it's not a hostel; Maria rents out the rooms on AirBnB which are not occupied by students).
The single room has a beautiful view facing east towards Miradouro Senhora do Monte and is functionally equipped with a small bed, inexpensive Ikea furniture and has a carpeted floor.
There is ample of common space in this nice old building, with the disadvantage that the reverberations of people talking in the common space makes it far from quiet for the rooms adjacent to it.
The students were all very friendly but I couldn't help but feel a bit sorry for them with the AirBnB coming and going in a place where they actually live...
When you plan your stay, be aware of the reception schedule: 10-13 and 13-17). If you arrive outside these hours, there is a fee of 20 EUR until 20:00 and 30 EUR from 20-22:00.