Money

Revealed: The destinations holidaymakers rate best value and the lowdown on those that actually offer the lowest prices

Green listed Portugal scores on both counts as Holiday Money Report unveils the best bargain holiday hotspots and holidaymakers’ favourites

After being named one of 12 ‘green light’ destinations by the government as rules on overseas travel start to be relaxed from 17th May, the annual Post Office Travel Money Holiday Money Report brings news that Portugal has earned the highest rating for good value from UK holidaymakers. Its leading resort area, the Algarve, also emerges as cheapest in the Eurozone in the Worldwide Holiday Costs Barometer. Published within the annual report, the barometer found that prices have fallen in three-quarters of resorts and cities.

When holidaymakers were asked to name the destinations which they believed offered good value, Portugal topped their ratings alongside ‘amber light’ rated Greece and Spain’s Costas – providing a clue to where they are most likely to book holidays once travel is allowed. All three scored 89 per cent and that approval rating rose to 90 per cent or more among holidaymakers who had previously visited those countries (Greece: 92%, Spain: 91%, Portugal: 90%). Thailand was named the best value long haul destination with a score of 81 per cent, rising to 92 per cent among past visitors.

However, Bulgaria, which is currently on the government’s ‘amber light’ list, is the destination where holidaymakers will actually find the cheapest prices for a range of eight tourist staples (a three-course evening meal for two with wine, bottle of beer, glass of wine, can of Coca-Cola, large bottle of water, cup of coffee, suncream and insect repellent) according to the Worldwide Holiday Costs Barometer of 46 destinations, nine of them new for 2021.

Bulgaria is one of the cheapest destinations for tourist staples according to new research (Image: Visit Bulgaria)

Sunny Beach in Bulgaria continues to prove unbeatable value and tops the barometer for the fourth consecutive year. Prices were already at rock-bottom in the Black Sea resort but they have fallen a further 14 per cent to just under £28 since last spring, making Sunny Beach a quarter cheaper than runner-up Turkey. Barometer costs in Marmaris have also fallen by around 14 per cent year-on-year to £37 but this is entirely thanks to the weak Turkish lira.

Portugal’s Algarve (£44) completes the top three as a 16.5 per cent fall in barometer costs helped it consolidate its long-established position as the Eurozone’s cheapest resort area. The price fall has helped Portugal to pull away from Spain’s Costa del Sol, which is 31 per cent pricier at £58. The Costa has fallen from fifth to seventh place in the barometer top 10 after registering a three per cent price rise. Another Portuguese destination, Madeira (£62,10th), is one of two new entrants to the top 10, edging out Cyprus (£67, 13th).

Portugal’s Algarve is the third cheapest place to holiday after Sunny Beach in Bulgaria and Marmaris in Turkey

The second new entrant to the best value top 10 is Sri Lanka (9th), which replaces Japan, where prices in Tokyo (down from 3rd to 12th in the table) have risen 24 per cent to £66. The 16 per cent reduction in prices to £59 in Sri Lanka is a consequence of the weak rupee since local prices remain on par with a year ago. Prices for long haul destinations were provided by tour operator Travelbag.

While Thailand was named best value long haul destination by UK holidaymakers, the Worldwide Holiday Costs Barometer reveals that prices are lower in both Bali and Vietnam. Bali (£55) has risen up the barometer table to fourth place, thanks to a 13 per cent fall in barometer costs, making it the cheapest long haul destination surveyed this year. Hoi An in Vietnam (£58) takes eighth place after recording a nine per cent price fall. Prices in Phuket (£81, 26th) are 42 per cent higher.

Cape Town, South Africa (£56, 5th) and Czech capital Prague (£57, 6th) complete the 10 best value destinations – although prices have risen 11 per cent in Cape Town, one of only seven destinations surveyed to show an increase.

By contrast, prices have fallen in over three-quarters of the 37 destinations also surveyed in 2020 – by over 10 per cent in a third of them. Post Office Travel Money says this is because of volatility in both currency values and in local costs of meals and drinks, the items most likely to dent the holiday budget. The biggest fall of 46 per cent is in Costa Rica (25th, £80), where local prices in Tamarindo have dropped by a third and the benefit to UK visitors has been compounded by a sharp fall in the value of the Costa Rican colon.

There have also been significant price falls of over 20 per cent in Malaysia (£72, 17th), Jamaica (£76, 21st), Dubai (£99, 34th) and the Seychelles (£127, 43rd). A fall in the value of its rupee means prices are down 23 per cent and the Seychelles is no longer rated the most expensive destination as it has been for the past two years. In Jumeirah Beach, Dubai prices have plunged for the second year running and are over 27 per cent lower than in spring 2020.

Closer to home, Europe’s biggest price fall has been in Italy, where Puglia (£94, 30th) recorded a drop of over 18 per cent, making Italy marginally cheaper than Nice (£95, 31st) in the south of France for the first time.

Nick Boden, Post Office Head of Travel Money, which accounts for one-in-four UK foreign exchange transactionssaid: “People who are hoping to take an overseas holiday and have not decided on their destination should make sure they know the regulations that apply to countries they are considering at the time of booking.

“When budgeting for their holiday, they should include all the costs of travel abroad in their planning. This does not just mean comparing package prices or flight costs but also doing their homework to check how resort prices have changed since their last trip. Big falls in many European and long haul resorts spell good news – so choose carefully.”

The United Arab Emirates destinations of Abu Dhabi (£159, 46th) and Ras al Khaimah (£142, 45th) are the most expensive destinations of the 46 surveyed – at least 42 per cent pricier than Dubai, the third Emirate surveyed.

Turning to the Outlook for Travel, the report’s overarching theme, consumer research on attitudes to holidays abroad reveals caution, anticipation and aspiration in equal measure. Besides obvious concerns about the impact of Covid-19 on holiday cost and safety, with 90 per cent worried that changes to travel rules could cost them money, two-thirds of consumers remain concerned about post-Brexit red tape and delays. The cost of travelling to their destination (74 per cent) and prices within resorts (64 per cent) are a more important consideration than package holiday discounts (59 cent) and only two-in-five (39 per cent) rate job insecurity as important in decision-making.

Over half of those surveyed (51 per cent) have either booked holidays, are planning trips or still considering whether to do so. City breaks remain the top choice as they have been for the past three years, with over one-in-five (22 per cent) planning to visit an overseas city this year. However, the research reveals a growing taste for experiences that encompass scenery, wildlife and the world’s great sights – suggesting a desire to get off the beaten track on holiday.

When asked what would prompt their future holiday choice, 57 per cent of holidaymakers named scenery, while 43 per cent said it was the chance to see the ‘world’s great sights’ and 37 per cent said they wanted to see wildlife. This helps to explain their bucket list choices. Australia and New Zealand – currently off limit to UK visitors – top the list and were chosen by 44 per cent of consumers. Canada was third with a 41 per cent vote, while Iceland (38 per cent) was the highest placed European destination.

One in four people in the UK get their travel money from the Post Office (Image: Post Office)

Further clues about where holidaymakers planning overseas trips might choose to visit are provided by currency sales trends in 2020 and 2021 to date. While the euro and US dollar remain by far the Post Office’s bestselling currencies, there has been strong demand for UAE dirham, which has moved up to fifth place in the top 20 bestsellers, suggesting Dubai will be a popular choice.

Another long haul destination that looks set to attract more UK visitors is Vietnam. The Vietnamese dong makes its first ever appearance in 13th place in the Post Office Travel Money top 20 for the past 12 months and has currently risen to eighth position in 2021 to date.

The healthy performance of sterling against most holiday currencies could prove the tipping point in their decision making. Analysis by Post Office Travel Money reveals that sterling is currently stronger than a year ago against over three-quarters of its top 30 currencies. The biggest gains of more than 20 per cent are against the Turkish lira, Costa Rican colon and Jamaican dollar. Sterling has also risen significantly against the US dollar and Caribbean currencies.

Post Office Travel Money’s Nick Boden said: “Sterling’s strength against the majority of holiday currencies means it really ought to play an important part in decisions about where to travel abroad. The purchasing power of the pound means people changing £500 into US dollars or East Caribbean dollars, the currency for Antigua, St Lucia and Grenada, will get the equivalent of around £61 extra.

The Post Office is the UK’s leading foreign currency provider, offering around 60 currencies for pre-order at around 7,000 Post Office branches or online at www.postoffice.co.uk/travel for next day branch or home delivery. 3,600 larger Post Office branches stock the leading currencies and around 7,000 offer euros over the counter without pre-order. These can also be ordered online for same day ‘click and collect’ at selected branches, next day collection at any branch or home delivery.


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