A European holiday favourite has topped the list of the world’s cheapest sunny getaway destinations in a recent survey. The Post Office's Holiday Money Report annually assess the places where travellers get the most value for their money and found that a popular region has climbed to claim top spot.

Located in the Portugal’s southern most region, the Algarve was found to be the place where money stretches further than any else. Known for its stunning beaches and resplendent golf courses, the Portuguese favourite beat Cape Town and Tokyo to top. The study looked at factors likely to impact holiday booking decision making including exchange rates, the cost of eating out and the price of the most popular tourist destinations.

The study took into account the cost of eight items to produce an average cost of a visit which formed the basis for their rankings.

Amongst them were a three-course meal for two with wine, a cup of coffee, a bottle of local beer, a can of cola, a glass of wine, a bottle of still water, suncream and insect repellent.

The results saw the Algarve come top with an average price of £58.95, narrowly beating Cape Town with a score of £59.84 and Tokyo with a price of £63.34.

According to the findings, the average three course meal cost just £40.33 while a bottle of local beer cost just £2.12.

In 2024, the Algarve saw a record number of tourists descend on the island, with 5.2 million visitors making the trip.

The tourism boom is believed to be in part as a result of its southern location, providing reliable warm temperatures throughout the summer months.

Algarve tourism boss André Gomes attributed the record-breaking success to the region’s diverse offerings, stating: "The Algarve is one of the most complete tourist destinations in Europe."

Famous for its numerous golf resorts and sandy beaches, the area is also popular amongst surfers, with many flocking there each year to experience the ideal waves along the undeveloped west coast.

Kuta, the beach resort in the south of the island of Bali was fourth while Delhi was fifth.

The remainder of the top 10 saw Europe and South East Asia alternate positions, with destinations in Bulgaria, Vietnam, Czech Republic, Thailand and Spain completing the table.