This little hotel just south of town is a jewel. The casitas (small cabins) are large, spotlessly clean tiled construction. The decor is a bit austere but comfortable. Our king size bed was a bit firm for our taste, but the bedding is new and clean. All units have a beautiful view of the Sea of Cortez.
The complex does not have a restaurant, so you will need a car. The hotel has wireless high speed internet which worked fine in unit 7a, but I understand is a little spotty in some of the other units. Business travelers we met while in town all commented that Las Casitas was far and away their first choice in accommodation in Santa Rosalia.