Recommend: Hostel Independencia – only because it’s comparatively cheap – you can camp or stay in the hostel for CHP$6000pp including an awesome breakky.
Stock up on expensive items in duty free Zona Franca – but it’s not that cheap, especially for electronics!
Punta Arenas is a nice town in Chile. It is clean and modern, but lacks the charm of Puerto Natales. It’s not the biggest tourist destination. It does have a fancy Casino and some flash restaurants probably aimed at the navel traffic it receives. Punta Arenas was the earliest southern town in South America to be established, and also the first town in South America to adapt electricity.
We stayed for a few days in Hospedaje / Hostel Independencia for CHP$6000 pp/night. It’s run by a guy who cooks you breakfast in the morning – eggs, cereal and yoghurt for breakfast. It’s a cheap place to stay with breakfast and towels included. It’s a few blocks from the central district.
We spent one night in Punta Arenas pretending we were not backpacking. – We went out for a fancy dinner at La Luna, eating king crab and ordering entree and cocktails, and then drinking at the casino. I played blackjack and won quite a lot before loosing it all in a losing streak later on.
I bought some more memory cards and a portable hdd from zone franca (duty free). Again IT stuff is really expensive. I’ve seen outdated iPods being sold at ridiculous prices. 500GB HDD – CHP$58,760 / AU$113, 8GB SD card – CHP$8000 / AUD$16.