Having been in the Dubrovnik area on 2 separate occasions, I want to suggest Cavtat as a wonderful alternative as a home-base when staying in the area for more than a day or so.
When we stayed in Dubrovnik 2 years ago, I found it crowded and expensive. The restaurants were accustomed to cruise ship customers (in & out in 1 day) and really didn't seem to care about happy customers. Our little room (out of Rick's book) was $100. Although Dubrovnik is certainly something to see, and a walk around the wall is a must, I think it is over-rated.
This year we ended up spending 5 nights in Cavtat, which is a charming little town just a few miles from the Dubrovnik airport. Cavtat sits on a beautiful little bay with nice walking paths around 2 nearby peninsulas. There are numerous, nice beaches for swimming and the water is clean. There are so many apartments for rent at very reasonable prices. It's easy to find a very nice place for 50 euros a night, with a little kitchenette and balcony for a perfect breakfast! There are lots of restaurants in every price range. And because a lot of people are there for a longer period of time, they actually do their best to provide good food and good service for a reasonable price.
We had a car, so we could visit Dubrovnik or other nearby areas. But if you don't have a car, there is a bus or taxi-boat to Dubrovnik a few times a day.
Cavtat is definitely worth your consideration.
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