Maybe not cheap if you are a backpacker but it certainly is compared to one of the business hotels I had to stay in in Dar both before and after my visit to Zanzibar.
Being in Stone Town, the location is fantastic (if you ignore the touts on the street). The hotel has a run down feel (like much of Stone Town) but once I got to my room I found all the basics (aircon, ceiliing fan,TV, fridge, hot water shower) and a high degree of cleanliness (higher than I was expecting). There was even a guy who came round the rooms in the evening to give them a spray against mosquitos (which weren't a problem). Rooftop restaurant only serves breakfast but there are plenty of nearby restaurants serving some excellent food.
Overall, highly recommended