June 2, 2010 | Read Time: 1 minute
Declining property values have started to affect how much American charities receive from the estates of donors who died in recent years.
Now Third Sector reports that the same thing is happening in Britain. British charities collectively lost the equivalent of $83.5-million last year in bequest or “legacy” gifts, according to a study by the Centre for Charitable Giving and Philanthropy. The researchers attributed the decline to the drop in property and asset values in the United Kingdom. In a typical year, British charities receive about $2.8-billion in estate gifts.
Because donors’ estates often take a year or two to settle, the drop in such gifts has lagged behind declines in other gifts such as cash and donated stock.
In both countries, the slump in the real-estate market is hampering the ability of executors to sell houses and other property. Even when they do sell, less money is left over for the charitable gift than there would have been, say, in 2007, before the economy unraveled.
However, British charities — at least the largest ones — may be less affected by real-estate woes than their American counterparts. The British study found that the among 20 institutions that earn the most in bequests, accounting for 42 percent of all legacies in the U.K., estate gifts were down by only 3 percent.
In the United States, large nonprofit institutions such as the American Heart Association, Harvard University, and the Nature Conservancy have all reported declines of 10 percent of more in estate gifts.
