Yes, you can get a hostel at PEC University if you live in Chandigarh. But Punjab Engineering College has its own procedure to allot hostels to students. 

• As per University procedure, firstly University will allot hostel rooms to students living outside Chandigarh. 
• The remaining seats after the allotment will later be given to waiting list students including locals and students with Chandigarh Quota. 
• PEC has huge hostel promises and enough rooms for students. You do not need to worry about not getting the seats. One of my cousins who is a local is also staying in the PEC hostel. 
• You might have to wait a bit to get a hostel. Approximately it takes 2 weeks of time to allot rooms to locals. 
• You also have to submit a written application to DSA with attached address proof.

Therefore, yes Chandigarh locals get hostels. As PEC hostels are big enough to accommodate all students.