Algarve Named Best-Value Destination for UK Travelers in 2025

Portugal’s southern region tops the Post Office Holiday Money Report for affordability, driven by low dining costs and a stronger pound.

The Algarve in Portugal has been ranked the most affordable destination for UK holidaymakers in the 2025 Post Office Holiday Money Report, marking its first return to the top spot in nine years.
The report compared the cost of eight common holiday items, with the Algarve offering the lowest prices, including £40.33 for a three-course meal for two with wine and £1.27 for a cup of coffee.
The affordability is attributed to consistent low prices in the region, a 1.6% drop in overall costs since last year, and the British pound’s 1.8% year-on-year increase against the euro.
Long-haul destinations such as Cape Town, Tokyo, and Bali also ranked highly for value, although their costs have risen compared to last year.
New York City was identified as the most expensive destination, with a three-course meal costing over £128, while Nice, France, was noted as the priciest European destination.