Breakfast at Hostel Luna Sonrisa was pretty good, actually it was really, really good. For a start they had unlimited strong, real coffee and then they had freshly baked darkish, European style, bread. With chunks of cheese and homemade jams, it was divine.

Over breakfast we chatted with a Dutch couple who were taking 3 years to sail round the world... now that would be an adventure, being able to stop pretty much where you wanted and reach some of the more inaccessible areas along the coastline.

We walked down the hill to Plaza Sotomayor to meet up for the 10am Tour 4 Tips walking tour. It is part of the same group who had the tours in Santiago, and Valparaiso's was rated equally highly. Our 'Wallys' for the morning were Matias and Pricilla, and of course, a couple of quiltros joined us too. One of them was called David Bowie because like its namesake, each eye was a different colour.

We walked over to the port first, it is very important for the city and the primary reason for the city of Valparaiso to be established. In the golden era, most ships stopped in 'Valpo' on the way to the west coast of America when sailing from Europe. Then the Panama canal was built and town lost its global importance.

The original shore line used to be by the Naval building on the other side of Plaza Sotomayor, about 300m from where it is now. With land being built out into the sea for such a distance, the harbor is very deep. At 44m (about 125 feet) it's perfect for large ships.

During Valpo's golden era, it had lots of "firsts" for Latin America for example the first fire station. The town is very fire prone because of a combination of the dry climate, the electrical power system and way of building houses. The first fire station was founded by 151 British and 4 Chileans, but financed by an American so it's called the Fire Station of America. Firefighters are all volunteers and it's considered the most prestigious and respected institution in Chile. When there were no fire stations, the people would simply help each other. Now there are 16 fire stations, all established by immigrants from different countries wanting their own fire station. Even today, the firefighters wear the original helmet styles from the fire station's "home" country.

Cochrane Street, running along the southern side of Plaza Sotomayor, used to be both the street on the waterfront and the fanciest street in the whole of Latin America. It was full of fancy houses, frequented by the rich people and was said to smell of expensive perfume. Once the Panama Canal was built though and prosperity declined, it went into decay. Today it looks very sorry for itself and the only reason to visit the street would be to see the yellow line indicating the original shore line.

Just off Cochrane Street is Escalera Cienfuegos (100 fires), it is a set of 164 stairs built into the steep hillside and was so named because it burns your legs to walk up the steps. They also built a 'funicular', like a lift on a slope, to take people up. The hills are so steep and high that some people, called "portenos", live their lives up in the hills and only come down to the plano (the downtown) if they really have to. The Italians established little shops or 'emporios' from where the portenos can get their essential items and avoid trips down the hill. Each hill community is like its own little world and have very strong community feeling.

The funiculars are all old, but very special to the city. If one breaks down it does take a long time to fix, because all the parts are unique. There are 18 funiculars in the town of which approximately 10 are owned by municipality and of which usually about 7 are working at any given time. All funiculars cost only 100 pesos (about 20c) except for one that is 300 pesos as it is considered more of a tourist lift than something for people's daily use.

One of the most striking buildings in Valpo is the one nicknamed 'Sugar Cube'. A very important shipping company asked for permission to modernise and increase the size of their building, but the town initially refused planning permission. After threats to move their business to San Antonio, now Chile's biggest port, they finally got the permission to build a 'glass box' inside the original historical building. Local architects and a group called Friends of Valparaiso went to UNESCO to ask for their support to stop the project, and officials from UNESCO came and liked what they saw in the town as a whole. An area within Valparaiso was subsequently declared a UNESCO World Heritage site so something good came from it.

We took El Peral funicular up the hill to Palacio Bauritzza. The quiltros walking with us didn't come on the lift, but ran round to the stairs and met us at the top. On the terrace in front of the palace there was great views of the port and the town. Looking further round the coast you could see all the beaches at Vina del Mar and the huge sand dunes beyond. Palacio Bauritzza is beautifully built in timber with a copper roof. It's now a museum of fine arts, but we didn't have time to go in and look around.

We walked down to Paseo Yugoslavo to the house of Senor Sergio, who makes hand-made Alfajores. We all got one each and they were delicious. Maybe we try to find his house again tomorrow. The surrounding streets were full of 'street art' - a combination of tagging, graffiti and murals. One of the more famous artists from Chiloe has painted a few murals showing Chiloe's people with the upper body of a fish and human legs to describe the fishermen's move out of islands to the cities for work and money.

A lot of the houses built in Valpo use corrugated iron, which was dumped in the harbor by ships that used them for ballast to help them sail round Cape Hope. This helped to protect adobe buildings as they weren't really suitable for the coastal humid climate. The houses were then painted, in bright colors, with the left over boat paint, which was also dumped at the port. Some of the houses are built on incredibly steep land, what may look like one story building from the street could have as many as five floors built behind and below.

We walked a bit further and stopped in front of a very plain looking building that looked a bit like a community centre. It turned out to be the first Anglican church to be built in South America. Chile used to only allow people to follow Catholicism, but with lots of wealthy British people in Valpo they asked town permission to build their own church. It took a bit of negotiating, but in the end they were allowed on the conditions it had no cross on the roof and it didn't have an altar facing the entrance.

No sooner had the British built their church, the German community wanted their own church too. A very elaborate and fancy Lutheran church was built close by. To make a statement to the other religions, the Catholics then built a new church further up on the hill at San Luis with not just one cross but two.

We followed the narrow pathways to the top of Reina Victoria funicular. There was a slide that you could use instead of steps which was fun and pretty fast. At the bottom of the stairs was the Alta Mira craft brewery, which we didn't have time to visit but recorded the location on the map for a future visit.

Cunning Street was next on the list, it's a party street full of bars and cheap places to eat. Cafe Domino was pointed out because it is supposed to have the cheapest and the best 'Chorrillana' in Valpo. Chorrillana is typical Chilean dish of chips (french fries) covered in beef slices, sausage, onions and fried eggs, described by some as heart attack food.

We took the trolley bus to Plaza Victoria, one of town's main squares and walked up towards Cerro Bellavista. On the way we stopped at the Little Square of Dreams, a small area with seating decorated with broken ceramic tiles.

The tour ended with a chicha and white wine mixed drink, it's a typical drink for the portenos, while Pricilla made sure we had everything we wanted to visit marked on our map.

The tour had finished deliberately in Bellavista so we could walk up the hill to La Sebastiana, the house of poet and noble prize winner Pablo Neruda. There were amazing views and the audio guided tour gave a great insight into his life.

From La Sebastiana, we took Alemania Street back to the hostel, it's a flat street that hugs the curves of the hillside and has a couple of very good view points. It was maybe an hours walk, but as well as the views over the town and the sea, we got to see some of the neighbourhoods close up.

We went out looking for some dinner and decided to try Alta Mira brewery bar. Their menu looked pretty good so as well as David having the beer tasting paddle of 4 different ales, we ordered their gourmet chorrillana to share. The beers were good, especially the Irish Stout, the wine was good and chorrillana was exceptionally good and made with quality beef. With all the food, wine and beer we bought, we were brought a free glass of the brewery's special spicy beer made with coffee, honey and merken. It was interesting to say the least, you could taste all the flavors and it had a good spicy kick, but you couldn't drink much of it.

We took the Reina Victoria funicular back up the hill and went to an ice cream parlour that Matias had recommended on the morning tour. It was very good ice cream and David's request for coffee and ice cream (meaning Affogato) came in a huge glass smothered in cream.