June 23rd 2016 marked a historic change in Great Britain when we voted to leave the European Union. Eurosceptics were jumping for joy but there was also another big winner that day: The shock of Brexit to world markets caused the British currency to collapse in value meaning that, overnight, Scotland and the rest of the UK became (20%) cheaper to foreign visitors. This means that it’s a great time to book a holiday to Scotland (and the rest of the UK). The following blog explores how prices have changed and offers some top tips on how to get the best bang for your buck.
The first thing that’s worth considering is that the currency used in Scotland is the same as is used in the rest of the UK, pound sterling, usually referred to on the exchange rate markets as GBP (Great British Pound). So, if you are looking to buy some foreign currency in advance you can rest assured you will be able to use it in all parts of the UK, even though it will likely say ‘Bank of England’ on it.
So, now you know what currency to buy, just how much is it going to cost you? The good news is, at the time of writing (9th January 2017) the pound is currently close to a 31 year low against the US dollar; $1 USD will buy you £0.82 GBP. A year ago today the same $1 would have bought you £0.62, meaning the dollar is worth 32% more than it was a year ago against the pound! And if we look back even further, in January 2007 $1 would have only got you a measly £0.51. The buying power of the USD for Sterling at the moment is very clear to see. Likewise, the Euro is also doing pretty well against the pound; €1 will currently buy you £0.86, whilst a year ago it was £0.75, a 14.6% year-on-year change.
So how does this translate into prices?
Let’s look at our flagship Isle of Skye day tour from Inverness. This is priced at £69, and the prices have not increased in the last three years. However, if you are buying in dollars or euros, the price of this tour has actually decreased for you.
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If you’d booked this same tour in January 2016 you would have paid around $111.29 or €92, that’s $27.54 or €12.44 cheaper, respectively.
And if you had the financial misfortune to have been booking a similar tour in 2007 it would have cost you around $138 / €103.50.
Consequently, we can see that it’s a great time to book when considering exchange rates. However, with the UK highly reliant on imports, it’s only a matter of time before inflationary pressure sets in and prices in the UK begin to rise. The good news is that tour companies such as ours typically set our prices a long time in advance so the price you see in GBP likely won’t change in 2016 although that said fuel, food and other basics will all likely rise over the coming months.
So what action should you take?
If you are planning to come to Scotland book your tours, activities and hotels now! However, be sure to pay in advance so you can lock prices in. Remember many booking sites such as Booking.com require you to make final payment in the local currency when you check out, so the price you see now and the price you pay when you get here could be significantly different. You can guarantee prices by booking direct and paying your balance in full.
Even if you don’t want to pay for your hotels and tours now (although most tour companies will require upfront payment), it is still worth booking. As mentioned, inflation will cause prices to rise in the not too distant future and this will have a knock-on effect on everything, from food prices to hotels.