New data from the UK’s Legacy Monitor for the last 12 months to the end of March 2022, shows that legacy income is continuing to grow at a rapid rate, rising 15% over the previous 12 months.
After a drop in 2021, caused largely by continued delays in probate administration and the effects of the pandemic, the report shows that legacy income is beginning to recover to meet long-term growth trends.
Legacy income received by the 82 charities in Legacy Foresight’s flagship benchmarking programme (accounting for approximately half of the UK legacy market) is continuing to rise quickly, reaching £1.67bn over the 12 months to March 2022 – an annual increase of 15%.
The number of bequests received by charities in the Legacy Monitor reached a seasonal peak over the first three months of 2022, an 18% increase on the previous quarter.
Also, the charities experienced a rise in the average value of residual gifts by around 6% over the last 12 months, supported by rising house prices. Latest ONS data suggests that UK house prices were 11% higher in February 2022, compared to 12 months before. This should support continued growth in the average value of residual gifts over the next 6-12 months.
Although these latest figures are undoubtedly step in the right direction, the deepening “cost of living crisis” being experienced across the UK poses a notable risk to legacy income over the medium-term. Rising interest rates could have significant impact on property prices in 2023 and 2024, resulting in a knock-on effect on residual bequest values.
Jon Franklin, Economist at Legacy Foresight, says:
“Following a turbulent three years for the charity sector, legacy income has made a strong recovery to fall back in line with its long-term trends. However, whilst the number of bequests to charities is currently high, it still remains lower than we might have expected given the large numbers of deaths seen during the pandemic.
Prospects for legacy income continues to look positive for the next 12 months. However, with interest rates on the rise, there is some concern over the impact to property prices and whether the ‘cost of living crisis’ will have an effect on the legacy market.”
Subscribe to the Today’s Wills and Probate newsletter to receive industry updates, news and analysis
