The limits of luxury: hotel prices soar as tourism booms

By: Trademagazin Date: 2025. 01. 17. 11:05

The pandemic-battered hotel industry has not only recovered from the crisis, but also soared to new heights as tourism has recovered. Room prices at luxury hotels are breaking records, while demand continues to outstrip supply. Some exclusive hotel suites now cost tens or even hundreds of thousands of dollars per night – but what amenities justify these sums, and who can afford such luxury?

After a price crash in the early years of COVID-19, hotel prices have started to rise dramatically in recent years. By 2024, for example, the average room rate in Spain will have increased by 40% compared to 2019, reaching €161 per night. In London, entry-level rooms in luxury hotels are already asking for £1,100-1,300. The price increase is explained by inflation, rising operating costs and the growing demand for luxury travel, which is driven in particular by wealthy tourists from the United States and the Middle East, the Money Center points out.

The range of luxury hotels stands out not only in terms of prices, but also in the level of services. The world’s most expensive hotel suites offer extras such as a private submarine (St. Lucia, $150,000/night), a penthouse decorated with Damien Hirst works (Las Vegas, $100,000/night) or a suite protected by bulletproof glass with 12 bedrooms (Geneva, $80,000/night). The demand for such exclusive experiences remains strong, despite the fact that these prices are out of reach for many.

The global luxury tourism market reached $1.38 trillion in 2023 and is expected to grow by 7.9% annually until 2030. The industry is being helped by improved political stability, more inclusive social attitudes, and more flexible visa policies. The industry is unique in that it is less sensitive to economic changes, so many destination countries are focusing more on premium travelers who are looking for exclusive, high-quality services.