Rising cost of family holiday outstrips inflation

The average cost of an overseas family holiday break has risen at a rate that outstrips inflation according to a report by M&S Bank.

A half term break in May 2012 will cost families on average £128 more than at the same time last year, a 4.05% increase well above UK Consumer Price Index inflation of 2.8% across the same period.

Of the ten holiday destinations taken into account, Egypt (Sharm el Sheik) was the only country where were the average rise in the cost of a family holiday was below the level of inflation, with prices having risen by just 0.8% in the last 12 months. 

Paul Stokes, Head of Travel Money at M&S Bank, said:

"Egypt's modest price rises show the importance of taking into consideration favourable exchange rates and local costs when booking a holiday. As the Euro has strengthened against the pound, holidaymakers are starting to look further afield to make their travel money buy that bit extra; it can have a big impact on how much you have to spend when you get to your destination."

Meanwhile, Holland Amsterdam) saw the highest price rise compared to this time last year with the verage cost of a family holiday up by 6.1%.

Less favourable exchange rates that this time last year may be partly to blame for the rising costs according to the report.

France (Brittany) was listed as the most affordable destination with an average cost of £547 per person, with Spain (Mallorca) and Italy (Sardinia) trailing close behind at £632 and £714 per person respectively. Thailand (Phuket) saw the biggest percentage rise in costs with a 5.7% change.

A report by Gocompare.com, released earlier this week, found that around 1.8 million families in the UK with children of school age were considering taking them out of school for some or all of their holiday.

British families spend an average of £1982 on a holiday, but by taking some or all of it during term time could save,on average £664 on their holiday costs. 65% said they could not afford to take a holiday during school holidays when prices were higher.

Jeremy Cryer, from Gocompare, said:

"It's an unfortunate fact that the cost of holidays and flights increase substantially during school holiday periods. This leaves many parents with the difficult decision of whether to take their children out of school to take advantage of lower prices or to bite the bullet and pay the school holiday rates. With an average cost saving of over £600 it's clear to see why many parents choose to take the saving over the schooling.”