Selling your parents' house - what do you need to consider?

1. Who is allowed to sell the parental home?

The same rules apply to parental homes as to other, private residential properties. This means that only those persons who are registered as owners in the land register are always entitled to sell. Often both parents share the ownership shares of the land register and thus the right to sell the property.

If one of the parents has already died, the will decides what is to be done with the property. If the spouse is registered as the previous heir, he or she has the right to decide whether to sell the property or not. If, on the other hand, both parents have died, the legal succession comes into force: In this case, the children are entitled as heirs to decide on the whereabouts of the parental home.

However, it is also possible that the parents have already transferred the property to their children during their lifetime. In such a case, the right of residence or right of use must be examined individually, as these not only decide who is entitled to sell the house, but also any additional costs that may arise when the house is sold.

2. Selling the house to the child as a parent

As owners, parents naturally have the option of selling the house to their own children. In this way, many parents want to ensure that the property remains in the family during their lifetime or avoid inheritance or gift tax. The possibility of a lifelong right of residence may also be of interest to the parents. The Land register registered in the land register enables the parents to remain in the house for the rest of their lives, even if the property is transferred to the children.

Selling the parental house to one's own children can therefore be advantageous under the following conditions:

• The parents want to settle the future ownership of their house during their lifetime.

• The parents' house is to be passed on to a family member without inheritance or gift tax.

• The parents do not want to sell the house without a lifelong right of residence.

3. Selling the inherited parental home as a child

There can be several reasons for the sale of the parental home by the children. One example would be the sale as a result of an Inheritance. But it can also happen during the lifetime of the parents that children sell the house Sell the house. This is the case, for example, if the parents become legally incompetent. We will look at these two examples in more detail below:

Selling an inherited parental home

If a child has inherited the parents' house, it will be registered as the new owner in the land register. As a result, the new owner has the right to sell the parents' house or to move into it himself. If the decision is in favour of a sale, the child can sell the house as sole owner in accordance with the legal provisions.

The situation is different if several children inherit the parental home. In such a case, all children form a so-called community of heirs. If the property is then to be sold, this must be done at the unanimous wish of this community. As soon as one person from the community of heirs objects to the sale, the parental home cannot be sold. If, on the other hand, the community of heirs agrees on the sale, all members receive their share from the proceeds of the sale.

However, it is possible for an individual child from the community of heirs to buy out the property. However, this must also be in accordance with the wishes of each individual heir. If this is the case, the individual member from the community can purchase the house and must then pay out the remaining heirs in equal shares. Afterwards, the child, as the sole owner, can decide on the whereabouts of the parents' house.

Selling the house of incapacitated parents

Sometimes it is also necessary for the children to sell the parental home if the parents are no longer legally capable. This may be the case if the parents are no longer able to handle the sale of their home on their own due to illness or old age, for example.

However, children cannot sell their parents' house entirely without parental help. This is because the children need a general power of attorney in advance that they are allowed to sell the property. This is particularly important:

This power of attorney must be certified by a notary!

A simple power of attorney from the parents, for example in the form of a handwritten document, is legally inadmissible.

4. Parents' house: sell, rent or renovate and keep?

Whether it is worth selling, renting or using the parental property for one's own purposes always depends on the individual case. For children, however, after a certain age the centre of life is often in a different location, which is why many play with the idea of selling their parental home. This is supported not least by the continuing high demand for living space and the rising property prices in Germany.

For those who prefer a constant income instead of high, albeit one-off, sales proceeds, renting out their parents' house can be interesting. After all, rental prices in many German cities - above all in the Metropolitan regions - have been on a constant upward trend for years. Renting out the family home can therefore also be considered an attractive investment for the owners.

Last but not least, there is of course also the possibility of using the parental home oneself instead of selling it. However, since parental homes are usually already several decades old, the children should inform themselves about the structural condition of the house in order to get an idea of the renovation costs to be expected in the future.

Should you decide, for one reason or another, to sell or rent out your parents' house in a lucrative way, our estate agents will be happy to advise you. We look forward to receiving your contact request!