Price cuts offset sterling slide

The damage to the wallets of British holidaymakers caused by the UK’s vote to leave the European Union is not as bad as it seems, as resorts cut costs to lure tourists, according to a new report.

Concern over the falling value of sterling has left families worried that the price of their getaway will rocket, but research by the Post Office says that not only are prices down by up to 10 per cent on 2014, but also that the pound is as strong as it has been since 2011.

The highs of last summer when £1 was worth €1.44 are essentially an anomaly, says Andrew Brown of Post Office Money.

“It’s all about putting today’s exchange rates into context,” he said. “Sterling may have fallen recently but when you compare its value with every other year since 2011, except 2015, holidaymakers can be reassured that the cash in their pockets will cover the costs – particularly as bars and restaurants in several of the resorts we surveyed have cut prices to attract tourists.”

While meal and drinks prices have risen by an average of 18 per cent since last summer in 12 of the 14 European resorts considered by the Post Office (only Sunny Beach in Bulgaria and the Costa Blanca experienced falls), the research shows that the costs are down by up to 10 per cent compared with 2014.

The Post Office surveyed the cost of seven different items, including a bottle of beer, a cup of coffee and a three-course meal, and found that Ibiza, Sorrento in Italy and Nice in France were the three most expensive resorts this summer, while Sunny Beach in Bulgaria, the Algarve and the Costa del Sol were the cheapest.