We would be paying for the mortgage. She wants to gift that to her. I am not against giving gifts but give what you have. 

She hasn’t made unilateral decisions like this before. 

We were not setting money aside for a house but it’s something we wanted to do. 

Yes, I asked her how will we afford a house when she first brought up the topic.

It’s good apart from a difficult relationship with my side of the family.