If you had to pay the tax you could probably just finance it anyway instead of paying it all at once so it would be just like having a new (small) mortgage.
The point is reduce land entitlement a little bit. Yes, there's going to be some light incentive to cut loose and that's OK.
I know for a fact (through living here) that Denmark and probably the rest of Scandinavia has property tax and inheritance tax -- holding on to family property is almost as expensive as buying new property.
Which part of Europe are you referring to? I once had Greek colleague who complained about having to maintain three generations worth of houses, so that might be one place where things are as you describe?
It's gonna be an obligation no matter what
If he wasn't I probably did an extremely poor job of financial education while I was alive.
Personally, I think the answer here is a continued and ongoing land tax. Occupying land should come with an expectation you contribute to the common good, because you don't "own" land. It's a shared good, just like air and water, and you should pay for use.
Primary residences should indeed not be subject to an inheritance tax - if they are continued to be used as a primary residence. Providing an ongoing home for a family unit[1] is a societal good, we shouldn't punish it.
[1] Definition of family is a hairy problem for another, longer post.
Or, you know, keep posting oneliners.
What you'll end up with is people "relocating" for a year to avoid paying inheritance tax.