The Algarve has taken the top spot as Europe’s best-value family holiday destination for 2026, according to the 18th annual Family Holiday Report by Post Office Travel Money and TUI.

The benchmark study compared 22 major European beach destinations across a basket of 10 everyday expenses, including lunch, a three-course family dinner with drinks, and sunscreen.

Driven by a 2.7% drop in local prices over the past year, Portugal’s southern coast jumped from 3rd place in 2025 to lead the European rankings, bringing the Algarve’s average daily barometer cost down to £139.65.

This places the southern coast ahead of popular spots in Bulgaria (£142.16) and Spain (£147.42), while coming in significantly lower than other premium European locations. At the other end of the scale, everyday costs in destinations like Madeira (£260.21) and Sorrento (£268.23) came in at nearly double.

The report also highlighted that the region leads the Children’s Beach Barometer, offering the lowest prices for family essentials like lilos, beach toys and ice creams. As Laura Plunkett, Head of Post Office Travel Money, points out: “The low resort prices in Portugal and Spain make these countries great value for money.”

Commenting on the results, André Gomes, President of the Algarve Tourism Board, noted that the top ranking confirms the region’s ability to offer “a strong value proposition to visitors and reinforces a regional strategy focused on quality”.

For regular visitors and local property owners alike, this day-to-day affordability means that hosting family, dining at coastal restaurants and enjoying local beaches doesn’t come with the inflated price tags seen in other Mediterranean hotspots.