There are B&Bs all over the island, and during Classic TT practice week we had no problems booking a room. We chose to stay on the Central Promenade because it’s only a 15-20 minute walk to Nobles Park (where the grandstand is located.) There are also restaurants, shopping and laundry facilities nearby. There are many hotels along the water- all reasonably priced during practice week. It seems they book up early for racing weekends, so I recommend booking at least a year and a half in advance if you want to be there during the Festival of Jurby. If you’re trying to attend TT, some of the places are booked 3 years in advance.
All-in-all we found the most comfortable accommodations of our trip here at the Isle of Man. Gorgeous views, fresh air blowing in through the window, a bathtub-sized shower and enough room to really spread out our loot and re-organize our backpacks before we left.