Revealed: How to get around the post-Brexit rising cost of halfterm holidays

The research from M&S Bank has found that the cost of a family half-term holiday has risen by an average of £437, or 11.7 per cent year-on-year, mainly due to the continued decline in sterling.

But the study also shows that families planning to jet off for an autumn break next weekend could still save as much as £650, or an average of £386, by choosing alternative, ‘plan B’ destinations over better-known resorts.

For example, using Long Island instead of Manhattan as a base to see New York could result in savings of £163 per person, or £652 for an average-sized family of four.

The sights of the Big Apple are easily accessible from Brooklyn and Queens, which are both on Long Island, but accommodation in these boroughs is significantly cheaper, at an average of £1,337 for a week-long stay in a family room compared with £1,865 in Manhattan.

Paul Stokes, head of products at M&S Bank, said: “Although holiday prices are on the up – partly due to the value of sterling continuing to fall – families can still benefit from significant savings by looking beyond the most popular destinations.

“Staying in Long Island is an excellent alternative to Manhattan, offering families a great saving. However, with the cost of staying in New York topping our list due mainly to the cost of the long-haul flight, it’s probably more of a special family treat rather than a cost-effective getaway.”

Holidaying in the Alentejo region of southern Portugal is more affordable and provides the second biggest saving, with a week-long trip costing a family of four £580 less compared with a stay in neighbouring Lisbon, the capital.

Meanwhile, venturing away from tourist hotspot Crete in Greece and visiting the mainland port town of Nafplio instead will save families a total of £576, mainly due to cheaper flight costs.

As well as offering families considerable ‘alternative destination’ savings, Alentejo and Nafplio are also the two cheapest destinations overall, making them good options for families on a tighter budget.

At £3,020 for a family of four (£755 per person) Alentejo is the most affordable destination. The area benefits from the cheapest accommodation costs of all the destinations researched (£373 for a week’s stay in a family room). Nafplio is only slightly more expensive at £3,164 in total.

In south-west Turkey, Ölüdeniz – known for its picture-perfect blue lagoon – is the third most affordable option at £3,504 for a family of four, despite costs rising by 18.2 per cent as sterling weakened against the Turkish lira (down 17 per cent year-on-year).

Formentera, Spain’s smallest Balearic Island, just south of Ibiza, is fourth most affordable (£3,528), while Portugal makes its second entry into the top five cheapest destinations with a half-term break in Lisbon costing £3,600 for a family of four.

Mr Stokes added: “Whether it’s the Big Apple or the Balearics, being flexible with holiday plans and shopping around for travel money are the best ways of reducing the cost of a family holiday this October half-term.”

It should be noted that M&S Bank made its calculations based on exchange rates on September 29, since when the pound has fallen further – by eight cents against the US dollar and more than five cents against the euro.

Sterling has underperformed compared with all other major currencies over the past month, and, with a ‘hard’ Brexit widely anticipated and Article 50 due to be triggered in the New Year, it is thought unlikely to recover any time soon.

Lloyds Bank has revised down its forecasts, predicting exchange rates of $1.25 at the end of 2016 (down from $1.30) and $1.30 (previously $1.36) at the end of 2017.