Phajsi Aruma B&B
65 Soles (approx $23)/night
I was going to give this place a terrible review...
None of the luxuries it boasted on it's website (hot water, internet, TV) were functioning.
Laundry service was quite expensive for Peru, and it didn't even come back to us dry in time for our departure.
It was a fair distance outside of town on a road without taxis running regularly, so it was kind of a pain in the ass to go anywhere. But Puno is not a town you really care to be in anyway, so location wasn't really an issue.
Our friends at Phajsi Aruma were saved from a poor grade however, when they took us in like their own family and took care of Reece when he was sick. If you ever plan to get food poisoning in Peru, this is THE place to be. They made us chicken soup. They went downtown and got special herbs to make tea that soothes the stomach. They gave us some Peruvian wonder meds, and in 24 hours Reece was back and better than ever. All of this at no charge. The mom even hugged us goodbye and made Reece promise not to drink cold liquids.
Oh yeah, and we had a decent view.