Not one negative comment on the hostel - 100% value for money! But in the low season during the week Ubatuba is almost like a ghosttown, and so it get's a bit empty and lonely at the hostel.
The hostel has one major setback - their smoking policy! They allow people to smoke in the kitchen and eating area. I talked to one of the owners about it, and his reaction was that "yeah, legally it's not allowed, but hey, we're aren't to strict about it". In the reception and tv-area they fortunately don't allow people to smoke, but with the ventilation from the courtyard and the hall (where they are allowed to smoke), you'll also have the smell here. The dormitories are safe heaven, though.