With the number of people dying with no children or relatives on the rise, Germany is facing a potentially lucrative conundrum. The State is proving the only heir for a growing number of deceased persons.
DW reports that in the state of North Rhine-Westphalia, the most populous state of Germany, the ‘fiscal legacies department’ dealt with 96 inheritances in 2001. That had increased to 246 by 2011 and the department expects that the figure could rise to 300 for the first time ever this year.
The court is responsible for overseeing a person’s estate when there is noone else appointed to do so. If the court determines that it is satisfied that there are no heirs, then the state is legally obliged to take responsibility for whatever inheritance there is. This is not always beneficial to the state – ultimately taxpayers – because sometimes inheritances include only dilapidated property which must be dealt with somehow or even debts. However, in other cases, it might include large amounts of money, boats, and expensive property.
If this becomes an increasing trend in European countries, could it potentially help taxpayers out of some of their future budget woes? As the baby boomers die, it also seems logical that there will be more of their property for less people. Where once it was split between a number of siblings, now it might only be split between one or two families. Or will there be no inheritance left after supporting the baby boomers through their long retirements funded from a smaller tax base of working age people?
This also leads me to wonder about property prices in general. Once the baby boomers die could it not take some of the pressure of housing markets and cause a drop in house values? I know there are various other factors such as immigration in the mix, but surely with so many baby boomers living in big houses on their own or with only their partner, more large houses will become available eventually. It is interesting to think about the effects this may have.