Transfer of property to children

Over the years, unfortunately (and not only for me) the value/prices of houses and plots of land have risen to extraordinary heights. Therefore, the property (house with land) that I live in has a value higher than 400,000 €. This exceeds the tax-free allowance in the event of inheritance. Now I intend to transfer the above-mentioned property to my son. (further guaranteed lifetime right of residence will of course be contractually agreed) Now to the question: Should I sell the property to my son (actual money does not have to change hands?) or should I gift it? Are there advantages or disadvantages to this, or is it financially indifferent? What about the notary fees? Has anyone done this before? Perhaps someone knows more than I do, therefore ... thank you in advance.

This exceeds the tax exemption in the event of inheritance.

Only if the son does not use the property himself.

Therefore, I now intend to transfer the above-mentioned property to my son.
(ongoing guaranteed lifetime right of residence will of course be contractually agreed)

The right of residence has a value that partly dramatically reduces the value of the house. Still over €400k afterward?

Should I sell the property to my son (actual money does not have to flow?)
or should I give it as a gift?
Are there advantages or disadvantages, or is it financially the same?

A gift can negatively affect your care – observe the 10-year period.

What about the notary fees?

Doesn't matter.

If the property has unfortunately already exploded in value, there is also option C, namely simply paying the tax on this windfall ;-)

It's not quite my topic, but couldn't you gift him shares of the property and then wait 10 years for the rest or the inheritance?

We have already had stories here of extremely unlucky "heirs" who have to keep Dad or Grandpa in the property forever, keyword right of residence. What was meant kindly can also become a burden. Such properties are hardly saleable, difficult to finance, but all obligations stick to the offspring. Creditworthiness for something of their own can be affected.

If it is sold cheaply (e.g. 1€), the tax office sees the difference to the market value as a gift, so it helps little to save taxes. correctly writes that the value of the right of residence is deducted. Calculating that is somewhat complex, but you can wrap your head around it (I have done that several times recently for condominiums).

Note: Have a usufruct registered, not just a right of residence. With usufruct, you would also receive the income (from rent) if you no longer live in the house but, for example, in a nursing home. It is advantageous to have some money to treat yourself nicely ;-) .

P.S. Is the son of legal age?

but all duties stick to the offspring

This can be excluded in a good notarial contract. With usufruct, I know it involves all rights and obligations of the property (including costs). And if the testator at some point no longer wants to take care (duties!), usufruct can also be revoked.

Thank you for the statements. Regarding 1. I thought that everything above the exemption amount had to be taxed. If he uses the property himself and it was, for example, 600Ts, would he then not have to tax the 200? In summary, it is probably best to gift the property completely. Due to the right of residence and the resulting decrease in value, the exemption amount of 400Ts could possibly be undershot. There is also gift tax, but surely the same applies as with inheritance tax (400T exemption). Is there information about the remaining value decreased by the restrictive right of residence (approx. in %)? Small note—yes, there are also family situations where details like usufruct etc. do not matter. The tip regarding one’s own creditworthiness is also good, but no longer relevant (retiree). The son is of legal age and also wants to build on the property. As a result, he and hopefully also I will reach the 10-year mark. Because of these 10 years, I intend to take care of it now! Are the notary fees fixed according to a fee schedule or freely negotiable? Does the value reduction due to the right of residence also apply here? Because the value is presumably the basis of the fee? Greetings from someone who hopefully lives a long time but is already thinking about it. One never knows.