
What you need to know about land registers – Part 3: Right of residence
in the first two parts of this series, we already dealt with the topics of divorce and inheritance. For the last part, we will skip forward a few years. The woman who inherited the fictional house in the last part now wants to sell it. However, she would like to continue living in the house. Here, too, a land register entry can help her.
Right of usufruct or lifelong right of residence
When the owner plans to sell her house, she initially considers granting herself a lifelong right of residence. A real estate expert explains to her the possibility of agreeing on a right of usufruct instead of a lifelong right of residence. The right of usufruct not only includes a right of residence, but also the right to continue to use the property. Should the woman ever require long-term care, she would have the option of renting out the house to finance her care home. However, in this case, she would also be responsible for continuing to maintain the property.
Entry in Section II of the land register
As she does not want to take care of the maintenance of the house, the owner decides, in consultation with the prospective buyer, to grant a lifelong right of residence. It is important that this, like the right of usufruct, is not only recorded in the purchase agreement but also entered in the land register. This is done in Section II of the land register entry, where encumbrances and restrictions on the property are recorded. The right of residence is listed here as an easement. The land register entry is important to ensure that the right of residence is retained even if the property is sold again. If it is only recorded in the purchase agreement, the contractual obligation only exists between the person exercising the right of residence and the current owner.
The right of reclaim
The real estate expert also recommends that the seller have a right of reclaim registered in addition to the right of residence. This is because, since the new owners are financing the house with a loan, the bank's lien still takes precedence over your right of residence. If the new owners become insolvent and the property is sold in a foreclosure sale, your right of residence would be revoked. The right of reclaim allows the property to be transferred back to the former owner in such a case.
Do you want to sell your property but continue to live in it and are considering registering a lifelong right of residence? We can advise you on your options.