I agree that hotels are a bit costly in the Philippines compared to China, Singapore, or Malaysia. But I assure that you'll definitely get your money's worth with the better views and nature.
Boracay is a white-sand beach like no other. I've been to that island for more than 10 times but I still keep on coming back. I love to hang-out with my hubby or party with my friends. I love the pristine white sand which never gets hot and water which never gets cold.
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There aren't really hostels as such in the Philippines, it's mostly hotels and as karazyal says they are more expensive than Thailand...bargaining in Philippines doesn't really work either, every time I try and bargain hotels have not budged on the price (even if they are empty!). Watch out for hidden charges too...for example some hotels we stayed at charged extra to use their pool even though we were paying to stay at the hotel or charged for pool towels.
According to Bwiiian, you can get a room for £5...we haven't experienced much of this. Accommodation rates have been higher than what we expected for a far inferior room to the rest of Asia. I think you will be looking more like £8 (500 pesos) for a room and that's at quieter beaches with just a fan and cold water, go to a busier place like Alona beach in Bohol or Boracay and you are looking at £15 (1000 pesos) for a fan room with cold water. We have travelled in the Philippines for a total of 9-10 months now on and off and this is based on our experiences or rooms at beach resorts all around the Philippines. Renting an apartment would mean you have to stay in one place and even that isn't an economical option as deposits and minimum letting periods are usually required.
Filipino food, in my (and my boyfriend's) opinion is the worst in SE Asia - usually if you order a chicken dish the 'chicken' is bones, wobbly skin and not a lot of meat at all. The European/Western dishes we have experienced have been just as bad tasting. Filipinos have told us they have far different taste buds to us and like things quite bland and sweet. Yes, McD's are everywhere and are around 100 pesos for a value meal, there is also the Jolibee chain which is the Filipino version of McD's and isn't good! But you probably aren't going to be wanting to eat McD's. The problem is wiht being on a tight budget, if you have a bad meal you can't stretch to buying another one, but supermarkets sell instant noodles for emergencies.
Travelling around in the Philippines is definitely not as easy as Malaysia, Singapore and Indonesia, there is no real set backpacker route in the Philippines, so most travel is by public, non-air con bus. Good fun but it can be very uncomfortable for us longer legged foreigners on the buses and a lot of travel is a combination of bus, trike, jeepney and ferry which can be exhausting, so travel slowly and don't try and cram too much in - a lot of people make this mistake. As you only have 3 and a half months over Philippines, Malaysia, Singapore and Indonesia you aren't going to be seeing much of the Philippines and it's a HUGE country and travelling overland will take up a lot of your time.
Because we have spent a lot of time in the Philippines and often meet travellers who are disappointed by what they find there, they expected it to have a 'scene' like Thailand, when in reality most of the beaches (with a couple of notable exceptions) are very quite affairs with bars that close at 10pm.
The last thing for you to consider about the Philippines is the exchange rate...it has plummetted to 67 pesos to £1, making everything a lot more expensive (this time last year it was 85 pesos to £1), Indonesia's exchange rate hasn't been affected really, Malaysia and Singapore's have dropped a little but not much. So a 35 peso San Miguel is now 55p or so, instead of 44p...all those extra 10 pences can add up if on a tight budget.
regarding travelling at Philippines' southern part (Mindanao)...its only a small part of that island actually where skirmishes between rogue Islamic militants and the military occur. They are confined mostly on the small island of Basilan and some Sulu isles. The rest of the island is generally peaceful especially the northern part...
The farther away from its southern part...the safer...there are also a number of cheap adventure sites that are worthy of exploring...though not as well equipped with modern tourist facilities...but its terrain and geography is worthy for the backpackers adventurous spirit...I have found a site where you can have an insight how it looks.. ([snip]) ... but before you go for a conquest, drop by at the nearest tourist assistance counter...which you can find immediately after you deplane at the airport arrival area.
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