Europe’s Most Expensive and Cheapest Countries for Hotels and Restaurants
Europe is famous for its food and travel experiences. From French cheese boards to Italian pasta, tourists can enjoy many well-known dishes and beautiful places. However, the cost of hotels and restaurants is very different from country to country. While some destinations are very expensive, others offer much better value for money.
Across Europe, travellers can find famous landmarks such as the Eiffel Tower in Paris or the hilltop views in Lisbon. But enjoying these places often comes with high costs, especially for accommodation and dining. This means travellers need to compare prices carefully before choosing where to go.
To help people compare costs, Eurostat uses something called the price level index for restaurants and hotels. This index shows how expensive or cheap a country is compared to the European Union (EU) average.
The EU average is set at 100. If restaurants and hotels cost €100 on average across the EU, the index shows how much the same services would cost in each country. A score above 100 means prices are higher than the EU average. A score below 100 means prices are lower. This index is not actual money but a comparison tool.
According to the latest Eurostat data, Switzerland is the most expensive country for hotels and restaurants among 37 European countries. A standard basket of these services costs around €171, which is 71% higher than the EU average.
At the other end of the scale, North Macedonia is the cheapest country. Prices there are about 50% lower than the EU average, with a basket cost of around €50.
Looking only at EU countries, Denmark is the most expensive place for restaurants and hotels. Prices there reach €148, which is 48% above the EU average. On the other hand, Bulgaria is the cheapest EU country, with a basket cost of only €53.
Regional Price Differences
There are clear regional patterns across Europe. Nordic countries, such as Denmark, Sweden, and Finland, are usually the most expensive for eating out and staying in hotels. Western European countries also tend to have prices above the EU average.
Countries like Ireland, the Netherlands, Belgium, Germany, and France are all at or above the €100 EU benchmark.
In contrast, Eastern Europe and the Balkan countries are much cheaper. Prices in these regions are far below the EU average, making them attractive for budget travellers.
In Southern Europe, prices are more mixed. Portugal, Spain, and Greece are clearly cheaper than the EU average and are popular choices for affordable holidays. However, Italy is an exception in this region, as prices there are higher than many of its neighbours.
Among other Mediterranean countries, Croatia is close to the EU average, while Cyprus and Malta are slightly cheaper but still more expensive than many Eastern European destinations.
Why Do Prices Vary So Much?
There are several reasons why hotel and restaurant prices are different across Europe. One of the main factors is the cost of labour.
Kristóf Gyódi from the University of Warsaw explained that the hospitality sector depends heavily on workers. Because wages vary greatly between countries, service prices also vary. Countries with higher salaries generally have higher restaurant and hotel costs.
Other important factors include energy costs, utility bills, VAT and other taxes, and the price of commercial property. In countries where rent and electricity are expensive, hospitality businesses must charge more to cover their costs.
The European hospitality association, HOTREC, also highlighted that businesses face very different cost structures depending on the country. Labour costs are the biggest part of hospitality expenses. Countries with higher wages and stricter social contribution rules usually end up being more expensive.
In addition, rising food prices, supply chain problems, and regulatory requirements increase costs, especially for small and medium-sized businesses. In countries where these extra costs are high, they are often passed on to customers in the form of higher prices.
High Prices Do Not Always Mean Low Affordability
It is important to understand that Eurostat’s price level index does not measure how affordable a country is. It does not consider income levels.
This means that even if prices are high, people with higher incomes can still afford hotels and restaurants more easily in their home countries. In wealthier countries, residents often have more disposable income, which balances out higher prices.
However, these differences matter a lot for travellers. People from high-income countries can often enjoy lower prices when travelling abroad. For example, travellers from Nordic countries may find Eastern or Southern Europe very affordable.
HOTREC explained that what really matters to tourists is value for money. When prices rise faster than people’s incomes, travellers may shorten their trips, travel during quieter seasons, or choose cheaper destinations.
Gyódi also pointed out that price differences are not the only factor that affects tourism. Distance, travel convenience, and unique attractions also play a big role in where people choose to go.
In the end, while cost is important, Europe still offers a wide range of options — from luxury destinations to budget-friendly countries — giving travellers plenty of choice based on their needs and budgets.
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