Like the rest of China Shanghai Guesthouses are really non existent what you want to be looking for are 168 hotels and hostels which will be the closest thing toa guesthouse in Shanghai

The best place which is pretty common in China is too look by the train station when we were there they had several hotels that had guesthouse prices You will find the hawkers outside across the street from the railway station as it gets later they will come down in prices a little if they are not full.
The best place we found for the money was the Le Fung which was a block away from the station which has a metro stop as well. many people go and stay in the bund area which is a good place to look for hostel rooms in Shanghai the price for our room was excellent at 165 Yuan each which comes out to right around 20 USD I couldn't find an address so look at the map below and I am sure that you will find it no problem.
