Why the Algarve has been named the top destination for a bargain break in Europe

With its golden beaches and endless sunshine, the Algarve has long drawn British tourists.

And its appeal is set to soar further after the Portuguese region was named the best-value European destination.

The Algarve overtook Sunny Beach in Bulgaria – often considered the cheapest resort for summer holidays – in this year’s Post Office Travel Money’s annual report. 

Researchers surveyed 40 popular long and short-haul destinations and looked at the price of food, drink and numerous tourist items, including suncream and insect repellent.

Sharm El Sheikh came in second place, followed by Sunny Beach, Marmaris in Turkey and Paphos in Greece. Hoi An in Vietnam was the cheapest long-haul destination, followed by Cape Town in South Africa and Mombasa in Kenya.

Sharm el-Sheikh took second place thanks to the devaluation of the Egyptian pound 

Vietnam’s Hoi An, a UNESCO World Heritage Site, is the best-value long haul destination for Britons, according to the Post Office

At the other end, Tamarindo in Costa Rica was the most expensive, followed by New York and St John’s in Antigua. The most expensive short-haul destination was Nice in France.

Although British holidaymakers continue to rate Spain as the best value destination, according to the report, the Costa del Sol was considered the country’s cheapest destination but came in at just sixth cheapest in Europe.

The report revealed that 90 per cent of the Post Office’s 30 bestselling currencies are currently weaker against the sterling than a year ago, resulting in price falls in many of the world’s most popular destinations – especially long-haul resorts and cities.

Despite the downward spiral of the Turkish lira, prices in Marmaris restaurants and bars have more than doubled as owners try to overcome the challenge of inflation. Even after applying the favourable sterling exchange rate, costs have risen 14 per cent. 

Prices in resorts and cities are one of the biggest concerns for holidaymakers planning trips abroad, according to the research.

Some 84 per cent of holidaymakers said costs for items such as meals and drinks would be one of their biggest considerations when choosing a destination.

Laura Plunkett, head of Post Office Travel Money, said: ‘The Algarve has always been great value, particularly for meals and drinks, but this year our barometer research found that local prices have remained steady and the strength of sterling means that visitors can expect to pay even less than last year.’

Despite concerns about holiday costs, half of Britons told researchers they intend to travel abroad this year – rising to 58 per cent of those aged between 16 and 34.

Cape Town in South Africa came in second place for the cheapest long-haul destination

At the other end, Tamarindo in Costa Rica came ahead of New York and St John’s in Antigua as the most expensive destination

Visitors can expect to pay even less than last year at the Algarve, due to the strength of the pound and steady local prices

And it may prove a good decision over Easter, with a combination of strikes, bad weather and rail closures making travel in this country an ordeal over the holiday period.

Easter Saturday is expected to be the peak day on the roads, with 15 million drivers setting out on trips on the equivalent day last year.

Motorists could also face tricky conditions, with the Met Office predicting ‘unsettled’ weather. The West Coast main line between London Euston and Milton Keynes Central is closed from Good Friday to Easter Monday, and there will be no trains between London Liverpool Street and Colchester over the weekend.

And families who do decide to go abroad could face lengthy delays flying back to Heathrow after a ballot for industrial action by Border Force staff.