Calle de Argumosa is the best street to sleep on — terraces, residential calm, five minutes from the Reina Sofía. The upper lanes near the Plaza de Lavapiés are the liveliest and noisiest. The Embajadores edge drops prices further; the Atocha edge puts the AVE station ten minutes away for early trains.
Lavapiés lists around 182 bookable hotels and guesthouses, from roughly €35/night. Prices on the area page are live; booking 3–6 weeks out usually lands the best rate, with free cancellation on most rooms.
If it books out or you want to compare: La Latina (from €40/night), Huertas — Barrio de las Letras (from €47/night), Sol (from €45/night) — each with its own area guide on this site.
Curated picks are coming — meanwhile, the live search covers every bookable property at the same price or better.