We stayed in 4 star hotel in Costa Adeje. In our region nearly all of them were four star hotels. Including breakfast, for two people, for four nights it cost us approximately € 550. The hotel was okay. We did not spend that much time in there, but it was very good for the guests with children that the hotel organizes some night shows and live music everyday. My advice would be to stay in an at least 4 star hotel.
In La Laguna and Santa Cruz, it is possible to find three star hotels more budget ones. The more hotels get closer to nice beaches, the more prices they demand.