"Look - there's a swan!" Hillary Christo hollers. "I thought it was a big, ugly duck, but it's a swan!"

She charges down to Lady Bird Lake for a closer look as several other guests watch from their lounge chairs on the sun deck.

The lake view is one of the key amenities at this place. Another is the price: $24.85 a night, including tax.

This is Hostel Austin, the cheapest stay in town. I didn't even know Austin had a hostel. But apparently the hostelling world knows, because the unassuming lakeside building off East Riverside Drive, which is for out-of-towners only, is consistently full.

Christo, 29, came to Texas from her home in Toronto, Ontario, to visit a friend in Bandera and decided to spend some time afterward in Austin to hear music. How long will she stay? She doesn't know.

"If I like it, I'll find a way to stay longer," she says. "If not, it's off to my next destination, which I don't know what it is."

Wanderlust and indefinite itinerary are two common threads in the fabric of hostelling, the travel option in which you sleep dorm-style and share bathroom and kitchen facilities with roomies you've never met. Getting to know them is one of the coolest parts of hostelling (unless you hate that sort of thing, in which case you'll find hostels hostile). The other charm of hostels, of course, is cheapness. In the current economic crunch, shaving dimes is important to more people than ever.

They include Christo and her fellow sunbathers this afternoon at the hostel: 29-year-old Graham Hare from England, 20-year-old Craig Williams from Australia and 26-year-old K.K. Felvey from ? well ? around.

"I'm San Antonio born, Brenham raised and pretty much lived in Austin most of my life," she says. "I'm a musician." She says she has a degree from the University of Texas and thinks of Austin as home, and that she's been traveling in Europe but is back in town to record some music and write a book.

Hare says he's doing a 60-day tour of the U.S. on a Greyhound bus, camping some and landing at a hostel from time to time "for a proper bed."

"This is a great place," he says as he watches Christo chase down the swan. Felvey has just been talking about a run-in with a mean swan, and everyone's hoping Christo was listening.

It's hot outside, something out-of-towners seem to be able to handle better than us locals. I plunge back into the air-conditioned indoors.

"The economy hasn't hurt us at all," executive director Amy Daley says as we walk through the common living area, where two guests are pounding away on the free communal computers. There's a printer, too, and free wireless for those who bring their own laptops.

Boots, the cat who's lived in the hostel nearly from the day it opened 20 years ago, moseys over to an upright piano that sits in the corner, along with a couple of guitars. Next to those is a little table with a land-line phone.

When I wander into the kitchen, I see Felvey preparing a pasta with rosemary and eggplant she picked in the garden out back. A bunch of eggplant has been placed in the refrigerator, and a note urges guests to eat it.

Each guest has a locker and also a cubby in the kitchen in which to store food.

"Central Market donates bread, and we provide Ruta Maya coffee," Daley says. She'll also occasionally whip up some pancakes for residents. But at the very least, hostellers know they can get first-class coffee and bread as a free breakfast.

There are books, magazines and games in the common room. Nearby are the four dorm rooms (one female, two male and one coeducational) with a total of 42 beds. By fall, the hostel hopes to have a private room and bath available for about $60 or $70 a night.

Nearby are the bathrooms: clean, functional and only slightly funky-smelling. Upstairs is a room for studying and watching a flat-screen TV donated by Dell Inc.

The hostel is run by nonprofit Hostelling International on property leased from the city. It's on Austin park land, which means no alcohol is allowed. (Drugs and guns are also forbidden.) For guests who want to go out for a few beverages and some Austin music, there's a big calendar on the wall showing what band's playing where.

Most guests don't have cars, Daley says. They get around on foot and on the bus. There's a city bus stop about a five-minute walk away, and even closer is a University of Texas student bus stop. (Apparently the drivers don't often check on whether those boarding the bus are, in fact, students.)

I head into a dorm room and flop down on a bottom bunk to do some writing, promptly bumping my head. (It's been a few years since I slept in a bunk.)

The bed's squeaky, but for a bunk bed, this is a good, solid one. The blue sheets are freshly washed. (The hostel doesn't allow people to bring their own bedding.)

A few other residents are in the room discussing running out for fast food. I wonder why they're talking about chain burgers when there are equally cheap good local spots nearby such as Juan in a Million (2300 E. Cezar Chavez St., a mile and a half walk along the eastern portion of the Austin greenbelt) and Mariscos (less than half a mile away at 1504 Town Creek Drive). The hostel keeps a list handy.

My $8.75 dinner at Mariscos is a splurge by a hosteller's standards, but it includes two huge fish fillets and mountains of fries and coleslaw. True penny-pinchers could hit the weekday happy hour (2 to 7 p.m.) for half-price appetizers and a $1.50 beer.

The hostel's a great cheap stay, but, alas, we locals can't gather our friends for a weekend there. The hostel is for out-of-towners, with a maximum stay of 14 days. Without those rules, the hostel's low rate would probably attract permanent residents, and that's not its purpose.

But for visitors looking for the cheapest possible way to do Austin - and with a fabulous lake view - this is the place. Careful with the swans, though.

handers@statesman.com; 912-2590

If you go ...

Hostel Austin, 2200 S. Lakeshore Blvd . 512-444-2294 , www.hiaustin.org . Rates start at $19 plus tax. The hostel also offers free workshops on cheap travel on Wednesday evenings at the downtown REI, 601 N. Lamar Blvd. Check the Web site for times and topics.