I just finished traveling through Asia and mainly stayed in hostels when they were available. When booking a hostel I was looking for a social scene (I was a solo traveler), clean, safe, and good location. Surprisingly, the best hostel network I found was in China (my route was Yunnan Province, Chengdu, Xian, and Beijing). The WORST were in Lhasa (if you want a bad example of hostels, mainly bc they were SUPER dirty and every bathroom smelled really bad)
A list of my favorites and why:
A) Hanoi Backpackers (Hanoi, Vietnam)
-A GREAT social scene with very patient and fun owners. One of the best I found in southeast asia
-free internet (24 hours) with headphones for skype
-clean and quiet dorms
-good location in old quarter
-free coffee and tea
*take note, I was in the brand new annex when i stayed here, it was immaculate.
-security of stuff was okay, not great
-good tour agency
B) Mama Naxis (Lijiang, China)
-cheap (seriously chump change, but that's china for you)
-an amazing family style dinner that create an amazing atmosphere to meet people
-"mom and pop" feel
-location was so-so
-Mama Naxi's is a bit of a legend in southern China and all backpackers know about it and is usually discovered through word of mouth. It just got put in the new China Lonely Planet which I am a bit bummed about. Hopefully it maintains its charm and "backpacker charm"
c) Sim's Guesthouse in Chengdu
-Sim himself is a saint and really cares for his guests
-good social network
-good information on travel/helpful travel agency (a must in china!)
-clean beds, showers so-so
-Just got put in new lonely planet- best review of a hostel I have ever read
d) Leo Guesthouse, Beijing
-I didn't stay here but wish I did, mainly bc it was super social, good book exchange, good travel agency,
As you can tell, my main selling point was it being social. For me, that's why I stayed in hostels. In Asia you can almost get hotels for as cheap as hostels (case in point- some hotels were cheaper than my dorm bed in Vietnam), so part of the fun of hostels is so you can meet people. I think I lucked out on security bc the places I stayed had okay security not great. oh and don't have a curfew! Curfews suck!
One of my dream ideas has been to open my own hostel and it looks like your brother is fulfilling it! My last recommendation is trying to find a place that doesn't have a major hostel yet. Lack of hostels (granted, lots of cheap gueshouses here which are nice but don't have the social aspect) most places in Laos, Kathmandu, and all over India.
Hope this helps and doesn't contradict what others have said too much!