Lifelong right of residence after a gift and move to a nursing home - financial expert explains

Lifelong right of residence after a gift and move to a nursing home - financial expert explains

According to a report from www.t-online.de, former property owners often report having a lifelong right of residence after giving away their property. This decision has financial and legal implications, especially if the resident moves to a nursing home. The lifelong right of residence allows the recipient to remain in their property and also saves inheritance tax. In addition, it protects the property from access by the social welfare office if the person entitled to live there is not able to cover the costs of accommodation in a nursing home.

The right of residence for life is recorded in the land register and is valid until the death of the person entitled to live there. This usually lives in the property rent-free and contributes to the additional costs and repairs.

If you move to a nursing home, your lifelong right of residence does not expire. Here too, the right of residence is retained. It only expires if the property becomes uninhabitable or the person entitled to live there requires permanent medical care, such as for coma patients.

For the real estate market, this can mean that the value of a property that is encumbered with a lifelong right of residence is reduced. In the event of a sale, the right of residence does not expire, unless there is a compulsory auction, which can lead to the deletion of the right of residence.

This information is of interest to potential property buyers and sellers as they need to understand the financial and legal implications of a lifetime right of residence. Therefore, it is important to seek professional advice to make the best possible decision.