Portugal’s top destination has emerged as the cheapest of 22 European holiday hotspots surveyed for the latest Post Office Travel Money Family Holiday Report.  Published in the week that schools break up for the summer holidays, the annual report, produced in partnership with leading travel and leisure operator TUI, found that meals, drinks and other tourist items are likely to cost least in the Algarve.  Sunny Beach, Bulgaria was a close runner-up, while six Spanish resort areas feature among the best value top 101.

The Algarve has moved up from third place last year to top the 2026 Family Holiday Costs Barometer, overtaking both Marmaris, Turkey and Bulgaria’s Sunny Beach resorts in the process.  At £140 for a basket of 10 tourist items, including lunch and evening meals for a family of four, a range of drinks, suncream and insect repellent, prices have fallen by 2.7 per cent since last July.

Second last year, Sunny Beach has retained its runner-up position in this year’s barometer even though prices have risen by 9.3 per cent to £142.  Bulgaria joined the eurozone in January, which may have had an impact on prices as has been the case for previous new entrants.  However, the Black Sea resort still boasts the cheapest family evening meal with drinks, priced at £73, compared with £78 in the Algarve.

The Canary Island of Lanzarote came third in this year’s comparison of prices, which were researched in 22 resorts by TUI and converted to sterling by Post Office Travel Money, the UK’s leading provider of foreign currency.  Prices fell by 2.8 per cent to £147 in top resort Costa Teguise.  As a result, Lanzarote is the highest-placed of eight Spanish destinations included in this year’s Family Holiday Costs Barometer.

Four of these were among six new resort areas – Costa Blanca, Costa Brava, Menorca, Sorrento, Tenerife and Zadar - added to this year’s cost comparison to meet the increased demand for holidays in Western Europe reported by TUI.  Keen pricing in the four new Spanish ones enabled them to feature alongside Lanzarote and the Costa del Sol in the best value top 10.  At £151, Menorca was highest-placed in fourth position, while the Costa Brava (£155) took fifth place, followed by Tenerife (6th, £158) and the Costa Blanca (9th, £173).  Long time favourite, the Costa del Sol came eighth with a barometer total of £163.

Another new introduction, Sorrento, is rated the most expensive resort in this year’s survey, with a barometer cost of £268.  The high cost of a family evening meal is, in part, responsible for this at £150.  Prices in Sorrento were found to be almost a third (32 per cent) higher than in another Italian destination, Puglia (15th, £203), and almost double the cost in the Algarve.

Echoing past years, prices varied by as much as 92 per cent across the 22 destinations surveyed and there
were big differences between resorts in the same country too.  In Greece, for example, the barometer totals ranged from £181 in Kos to £222 in Crete. 

Laura Plunkett, Head of Post Office Travel Money, which accounts for one-in-four UK currency transactions, said: “We found big variations in costs between the European resorts surveyed, which means it is more important than ever to do some research before heading off on your holiday to inform how much holiday cash you’ll need for meals, drinks and other tourist staples.  For those families who haven’t already booked and are looking for a late deal, the low resort prices in Portugal and Spain make these countries great value for money, while Bulgaria’s Black Sea resorts are strong contenders too.”

Resorts in Turkey and Cyprus complete the top 10 and remain good value.  Both countries have been negatively affected by the ongoing war in the Middle East but are offering great value for late bookings.  Despite the continuing fall in value of the Turkish lira, down almost 10 per cent year-on-year, the barometer cost for Marmaris has risen by 23 per cent to £159.  As a result, the Turkish resort has fallen from top place a year ago to seventh in the new table.  Prices have also risen by nearly 23 per cent to £177 in Paphos, which means the Cypriot resort has dropped six places to 10th in this year’s barometer.

Chris Logan, Commercial Director of TUI UK & Ireland, commented: “We’ve seen particularly strong demand for popular Western Mediterranean destinations, with holidaymakers continuing to choose trusted, well-established resorts that offer a familiar holiday experience. However, Cyprus and Turkey remain very popular, particularly with families, thanks to their strong mix of quality and value, plus there is still good availability for this summer, including our owned hotel products such as TUI BLUE and Holiday Village. Families can still secure a great deal for this summer, including free kids’ places, with both destinations continuing to offer excellent value for money. It’s also encouraging to see confidence following a brief period of uncertainty.”
In addition to the Algarve and Lanzarote, prices have also fallen in Malta and Ibiza.  Malta (£181) has risen to 11th place in the barometer on the back of a 3.1 per cent price fall.  However, the biggest fall has been in Ibiza, where a 12.7 per cent reduction in barometer costs to £212 has taken the Balearic island to 18th place in the table, ahead of Majorca (£220) in 19th place, where costs have risen by 8.9 per cent.
The 18th annual report comes as three-in-five families told Post Office that they are planning trips abroad during the summer holidays2.  Almost half (46 per cent) will be setting a higher budget to allow for increased prices.  However, the consumer research conducted for the Family Holiday Report found that over four-in-five (85 per cent) of them bust the budget they had set by 49 per cent on their last trip, spending £380 extra on the average budget of £771.  Meals and drinks are key factors that account for the high levels of overspending.  Over four-in-five (85 per cent) parents said they spent an average of £359 on eating out, buying drinks in bars and restaurants and shop-bought food and drinks. 

Treating their children is another factor in family holiday overspending. Four-in-five (79 per cent) of parents splashed out an average of over £36 on ice creams.  Meeting children’s demands for beach extras and water park visits set them back an average of £147 on their last holiday. 

Just how much it is likely to cost parents in the 22 European hotspots surveyed by Post Office Travel Money and TUI is revealed in the Children’s Beach Barometer, which shows that spending on buckets and spade, lilos, swimming masks and snorkels, ice creams, pedalo rides and waterpark visits could set a family of four back between £183 and £293 on a week’s holiday. 

In fourth place, the Algarve (£208) again performed well and represents good value for parents who want to treat their children to holiday extras without breaking the bank.  However, Puglia, Italy (£182), Funchal, Madeira (£199) and Marmaris, Turkey (£200) were the cheapest resorts, while the same items could cost as much as £291 in Porec, Croatia or £281 in Corfu.  Visiting a water park cost between £56 in Kos and Puglia to £140 in Corfu and £147 in Tenerife.

Laura Plunkett said: “Paying for children’s beach extras can soon tip the holiday budget into the red so plan carefully.  Some parents prefer to set an amount of pocket money to last the holiday so children can choose how to spend it.  Keep costs down by packing items like suncream, insect repellent and non-bulky beach gear in the suitcase. This top tip might even be enough to pay for ice creams and pedalo rides on your holiday.”