The potential adverse consequences of making the gift are:
That in event of your child/children divorcing (if he/she/they is/are or get(s) married) then their spouse would generally be entitled to a half share of the value of the property that you are gifting to your child.
That in event of you moving to a care home or to a nursing home then the local authority are entitled to call for the value of the property at that time to be taken into account when assessing the benefit that is to be paid on your behalf and they may obtain a court order for the sale of the property. Under current legislation this may apply for five years although currently we are not aware of it having been applied in any cases exceeding two years.
If your child/children becomes a bankrupt or insolvent then the Trustee in Bankruptcy or the Insolvency Practitioner can apply for an order to have you evicted in order to sell the house. Unfortunately you cannot override this by the Donee granting you rights of residence.
Further your child/children may take a mortgage or loan on the property with or without your knowledge and if unable to repay it or he/she/they stopped paying it then the Lender would obtain a court order to get possession of the property and to have you evicted.
If the Transfer is being made in an attempt to reduce your estate, if you remain living in the property then the Inland Revenue will regard the gift as a “gift with reservation” and the value of the property will still be included within the value of your estate upon your death, even though it may be registered to your child/children. Additionally if you were to die within seven years of the date of gift, even if not residing in the property then the inland revenue will regard it as a Potentially Exempt Transfer and will calculate your estate taxes accordingly which may still leave tax to be paid on the property depending on the value of your estate.