NEW YORK ( TheStreet) -- In the past month, a 7.64-carat blue diamond sold for more than $8 million, a 48,000-square-foot home in Bel Air, Calif., went for $50 million and Picasso's "Nude, Green Leaves and Bust" painting brought in $106.5 million.
Somebody's spending again.
After hiding out for a year and a half during the recession, the rich have returned. In the first three months of 2010, luxury spending increased more than 20% after diving 20% last year. The American Express (AXP - Get Report) Travel Insights research found that luxury spending in December increased 7% from the same period two years earlier.
In May alone, wealthy patrons put up $40 million for a 1936 Bugatti Type 57SC Atlantic, $32 million for an Andy Warhol self-portrait, nearly $29.5 million for Conan O'Brien's co-op on Central Park West and $5.7 million for a 1944 Patek Philippe 18-karat gold chronograph."One thing that's fueling it is a great sense of relief among the high-end consumer that the worst is over," says Gregory Furman, chairman of the Luxury Marketing Council. "Couples in Greenwich, and Cartier, to name a luxury brand, are thinking: 'Phew, we made it through.' " In the past three years, the nation's affluent and wealthy have grown less impressed with themselves and more happy. According to American Express' 2010 Survey of Affluence and Wealth in America -- which received input from 1,910 respondents with income among the top 10% of all Americans and a mean income of $520,000 a year -- 70% rate themselves as "very happy," compared with 40% in 2007. Though 94% of affluent Americans believe we're still in a recession, with 60% expecting it to last another year, 75% of respondents say they're succeeding in this economy because of decisions they've made. Instead of spending on just about everything, luxury consumers have decided to invest in their passions. Car lovers, for instance, make up just 14% of the affluent but comprise more than 40% of automotive spending. The same holds true for the fashion-forward 9% who closet 39% of all high-end clothing purchases, or the jet-setting 9% who account for 42% of all travel spending. Shopping isn't a splurge to these buyers, but a value-based investment in the tradition and continued heritage of a durable product.