Package holidays to popular Mediterranean destinations such as Mallorca and Crete have soared in price by up to a quarter compared with last year amid high demand and rising costs for providers.
All-inclusive deals for the most sought-after destinations for British holidaymakers – Spain, Turkey, Greece, Portugal and Cyprus – have gone up by nearly 12%, according to TravelSupermarket.
The average price across the top five Mediterranean destinations has risen by more than 30% compared with before the Covid-19 pandemic, well above the rate of inflation since 2019, according to data from the price comparison site, first reported by the BBC.
Demand from travellers is outstripping supply, while soaring food price inflation and higher bills for fuel and wages are also driving the rise.
TravelSupermarket’s chief executive, Richard Singer, said: “After a number of disrupted years of travel there is no escaping that demand for holidays is high as people look to book their much-deserved holiday. This, coupled with global inflationary pressure, has seen a rise in holiday prices to some locations.”
A week with full food and board in Mallorca now costs 21% more than last summer, and prices for Tenerife are up more than 22%. The Greek island of Crete is even more expensive than last year, up 25%.
This could prompt some people to hold out for better last-minute deals but Springer said the strategy may not work this summer because the high demand meant it was unlikely that prices would fall substantially.
“Prices for next year are looking on a par with this year,” he said. “However, there are still some great holiday bargains out there, especially if you can be flexible on date of travel, duration or potentially trying a new destination, such as Turkey, which still represents great value.”
Victoria Scholar, the head of investment at the trading platform interactive investor, said: “Travel businesses have been putting up prices to try to offset pressures from cost inflation including from wages, fuel, food, and drinks. Demand from consumers has remained robust despite this, with individuals and households prioritising their summer holiday while cutting costs elsewhere.”
She added: “It looks like families have been increasingly turning to package holidays as a cheaper way to travel abroad amid the cost of living crisis. But the lower price advantage that they are often known for offering appears to be diminishing.”
Travel experts say some people are responding by reducing the length of their holiday to save money.
The cost of package holidays has risen most in Spain, by 14%, compared with only 5% in Portugal.
The figures show the average cost per person of a seven-day family package holiday in Spain in August has risen from £808 in August 2022 to £926, and in Portugal from £949 to £1,000. Turkey has gone up nearly 10% to £991, and the cost in Greece has climbed from £974 to £1,098, a near-13% increase.
Prices for all-inclusive deals beyond the Med have also risen. Bulgaria, traditionally a cheaper destination, has gone up from £746 to £842 per person for a one-week family package holiday, up nearly 13%. A Mexican break now costs £1,782 on average, up 7.6% from £1,656 in August last year.
The only bright spot is car hire, which has dropped in price since last summer, according to the TravelSupermarket figures.
