Dubai has been revealed as the best-performing luxury market in a global study conducted by Visa.
The recent analysis by Visa Business and Economic Insights (VBEI) paints a nuanced picture of luxury retail activity in key hubs including Dubai, London, Paris, Singapore and New York.
The data revealed the pace of buying has slowed amid global economic uncertainty. In H1 2025, luxury retail spending declined across major global centres. This marks the first decline in the luxury industry since the financial crisis of 2008, excluding COVID-19 in 2020.
However, the recent analysis also highlighted how domestic cardholder activity in luxury shopping hotspots including Dubai, London, Paris, Singapore and New York City has more nuances.
Dubai’s Luxury Market
Dubai stood out from the trend. Consumer appetite for luxury remained strong, with about one in nine residents making a premium purchase each quarter, which is well above other major cities.
This is attributed to the number of affluent households in the emirate, with nearly 37% earning more than $150,000 a year. This statistic could rise further with the number of millionaires and HNWIs migrating to the UAE.
Key Luxury Markets
Despite economic headwinds causing a minor pullback in luxury spend in 2025, a broad spectrum of consumers, not just the ultra-rich, continue to purchase luxury goods. The research highlights how luxury goods are gradually transcending their traditional association with the top 1 percent of elite spenders. Data reveals a growing interest among the top 5% of affluent spenders, 10% and even 20%. This trend is partly fueled by younger generations like Gen Z and Gen Alpha stepping into the market, attracted by the allure of digital shopping and the status of luxury goods.
Overall, luxury retail spending fell during the first half of 2025 across leading cities. For instance, Dubai’s participation fell to 11% from a higher percentile in 2023. While typical luxury hotspots like New York and London saw varied participation.
Luxury E-Commerce
Luxury stores dominate and continue to play a central role in luxury retail thanks to immersive experiences, personalisation and in-person services, however, consumers are becoming more comfortable spending online on premium luxury goods globally.
Most notably, London, New York City and Dubai saw the combined share of e-commerce and blended luxury spending from Q4 2019 to Q4 2024 rise by 16.3%, 15.6% and 10.7%
percentage points, respectively.
December Rush
December remains a critical period for luxury spending, consistently seeing the highest numbers of transactions across global retailers. December is universally the busiest month for premium luxury spend across all of the cities analysed. Festive season drive demand, with retailers leveraging this surge through exclusive releases and strategic promotions.
