The allure of package holidays, traditionally perceived as a cost-effective travel solution, is facing a challenge in the post-pandemic era as prices surge across popular European destinations. This resurgence in demand, coupled with escalating energy expenses for hotels and the rising cost of aviation fuel, has created an inflationary pressure on package holiday costs, according to research conducted by Which?, the British consumer watchdog. This analysis, comparing prices of week-long package holidays in January 2024 for an August 2024 departure with those offered in January 2025 for August 2025, reveals a concerning trend: seven out of ten popular European destinations are experiencing price increases exceeding the UK’s overall inflation rate of 2.5 percent.
Bulgaria, a burgeoning destination on the Black Sea coast that gained popularity as a budget-friendly alternative to established holiday hotspots like Italy, Greece, and Croatia, exemplifies this trend. While still offering competitive pricing compared to other European locales, Bulgaria has seen the most dramatic price surge, with an 11.5 percent year-on-year increase. This translates to an average package holiday cost per person rising from £1,038 (€1,238) in the summer of 2024 to £1,157 (€1,380) in 2025. This significant jump underscores the impact of increased demand and rising operational costs on even the most affordable destinations.
Italy, another highly sought-after destination, has also witnessed a considerable price escalation. The average cost of a package holiday to Italy has risen by 7.4 percent, representing an increase from £1,163 (€1,387) per person in 2024 to £1,249 (€1,490) in 2025. Similarly, Portugal has experienced a 6.8 percent price hike, with the average package cost per person increasing from £1,267 (€1,511) to £1,353 (€1,614). Cyprus also follows this upward trend, with a 6.4 percent increase, pushing the average cost per person from £1,241 (€1,480) to £1,321 (€1,576). These substantial price increases reflect the broader inflationary pressures impacting the tourism sector across Europe.
While the aforementioned destinations have witnessed above-average price hikes, other popular holiday spots like Croatia, Spain, and Greece have also experienced increases, albeit at rates below 3 percent, generally in line with the UK’s inflation rate. This suggests a more nuanced picture across the European travel landscape, with some locations experiencing more pronounced price pressures than others. The relatively moderate increases in these destinations may reflect a more balanced interplay between supply and demand or differing cost structures within their respective tourism industries.
Conversely, the research also reveals encouraging news for budget-conscious travellers. Certain destinations have bucked the upward trend and are offering more attractive pricing compared to the previous year. Ibiza, for example, has seen a welcome 6.4 percent drop in average package holiday prices, from £1,269 (€1,513) per person to £1,187 (€1,416). Similarly, Spain’s Costa Dorada presents a more affordable option, with prices decreasing by 2.9 percent, from £1,074 (€1,281) to £1,042 (€1,243) per person. Tenerife also offers a slight reprieve for travellers, with prices dropping by approximately 2 percent, from £1,200 (€1,431) to £1,175 (€1,401) per person. These price reductions could be attributed to various factors, including increased competition among travel operators, targeted promotional offers, or adjustments in local tourism strategies.
In light of these fluctuating prices, Rory Boland, editor of Which? Travel, offers valuable advice to prospective holidaymakers. He emphasizes the importance of booking early to secure the best rates, suggesting that now is the optimal time to lock in the most affordable prices for summer holidays. Additionally, he recommends thorough comparison shopping to identify the most competitive deals. For families travelling with children, Boland suggests considering the last week of the summer holidays, as this period has often been found to offer lower prices compared to the peak season. This strategic approach to booking can help mitigate the impact of rising costs and ensure a more affordable and enjoyable holiday experience.
