Why Europe remains a bargain for Brits
TTG StaffPost Office Travel Money research shows that the pound is still strong against many currencies and 50% of European destinations are just as good value as last year. By Gary Noakes.
The Brexit vote last June brought tales of holidaymakers panic-buying euros and TV footage of chaos in the City, but new research shows it might not turn out to be as bad for the industry as many fear.
Post Office Travel Money’s latest Holiday Money Report shows that despite the events of 2016 and the collapse of the pound against the dollar and euro, sterling is still stronger against most popular currencies than it was in 2012.
Local prices have fallen or stayed on par with 2016 in more than a third of the destinations surveyed, which has prompted researchers to conclude that “by choosing carefully, the increased cost for UK travellers after the exchange rate has been applied can be restricted to between 10% and 13% extra in some of the most popular hotspots”.
Post Office Travel Money’s Andrew Brown said: “This year’s report puts 2016’s sterling fall into perspective. The pound may be weaker than 12 months ago but if you compare today’s rates with those of five years ago, sterling is stronger now against 60% of our 40 best-selling currencies.
“As many of these bestsellers also feature among our fastest-growing currencies, it appears that holidaymakers are becoming more switched on to where they will get the best value.”
The report singles out four destinations where sterling has gained significantly since 2012, led by South Africa (+41%), Mexico and Japan (+25%) and Indonesia (+20%).
The Post Office nevertheless said that currency would have an impact on destinations nearer to home this year. But there is further good news as the research revealed that costs in 50% of European countries will remain the same or have even fallen this year compared with last. The report adds: “By choosing one of these resorts or cities, holidaymakers can keep the increased cost caused by the weaker pound to a minimum.”
Bargain destination
The Post Office says the best example of this is the Algarve, which topped the list of the 44 destinations surveyed. While sterling may have plummeted against the euro, a shopping basket of eight items, including a meal for two, suncream, a beer and a coffee, totalled £33.36. Within this total, the price of the meal had fallen 5%, helping to offset sterling’s weakness and pegging the total increase this year to only 10%.
The next cheapest destination was Bulgaria’s Sunny Beach, whose total basket cost £33.53 following a 1.5% fall in local prices. In third place as most affordable, was the Costa del Sol in Spain. Its basket, at £38.79, benefited from a 3% fall in local costs.
Two destinations entered the top 10, Paphos and Sliema (Malta); but perhaps the most surprising was Tokyo, in eighth position, with its basket costing £58.47. The Japanese capital is the only long-haul destination in the top 10 and has displaced Cape Town, which dropped to 11th place from its former number three position.
Also pushed out of the top 10 was Bali, which fell from 8th to 13th place. Both have become more expensive because of local price rises and a recovery in their currencies.
One 2017 winner, according to Post Office Travel Money, will be Cancun, where a weak peso and stable prices have helped the resort measure a small 12% increase and move from 17th place in the chart to 12th, making it the third-cheapest long-haul resort. At the bottom of the affordability index was Dubai’s Jumeirah Beach, the most expensive destination surveyed, with a basket totalling £221 due to the high cost of drinks and meals.
Brown concluded that despite events of the last year, “Europe is looking unbeatable value”.
TTG Staff
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