Real Property - General

[EAS 42-203, 42-211.1]

Definitions

Real property is generally considered to be land and improvements. It includes such items as:

The house and the land on which it is built.
Immovable property attached to the land such as trees, fences, buildings, etc.
Mines.
Patented or unpatented oil.
Mineral or timber rights.

In addition to the items listed above, the following are evaluated as real property:

Cemetery property held for profit.
Stocks in a water company not appurtenant to the land in furnishing water for agricultural purposes. It is excluded as personal property.
Any other items of real property owned unless specifically exempt.

Real Property owned by the applicant or recipient includes real property which:

Secures any of the individual's debts.
Is being purchased by the individual under a sale of contract mortgage, and/or deed of trust.
Is being sold by the individual under a contract of sale, but no contract has actually been signed.
Is being held by the individual with the retention of life estate.
Is held in trust for the individual and is available for disposition or use.
Is held for the individual in an undistributed estate and is available for use prior to distribution.
Is being sold by the individual and is held in escrow.

Market Value

The market value of real property is based on the most recent appraisal of market value from the county assessor, recorder or tax collector.

Allowable Encumbrances

The following are allowable encumbrances:

Mortgages
Notes
Deeds of trust
Delinquent tax liens
Judgment items
Mechanics liens
Assessments
Unpaid balance on property
Property liens established to repay the CalWORKs grants.

Verification of Encumbrances

Verification of the above encumbrances is the document themselves, payment books, tax bills, assessments, etc. Evidence of unwritten encumbrances is the sworn statement of all parties under penalty of perjury regarding the:

Initial and maturity dates,
Amount of the encumbrances, and
Value received.

Evaluation Formula

To determine the value of real property, use the following computation:

The market value, less encumbrances, equals equity or the value of property.

	A	B	C
Real property market value	$28,000	$47,000	$58,000
Encumbrances	– 26,000	– 46,250	– 64,000
Amount considered as property	$2,000	$750	$00

Shared Ownership

If the applicant or the applicant and his/her spouse are not the sole owners of the property, only their proportionate share is included in their appropriate property limit.

Multiple Dwelling Unit

To determine the value of real property when the unit is a multiple dwelling with more than one unit and the client lives in one of those units, the EW must use the following formula:

Compute the market value less encumbrances and divide that amount by the number of units. Multiply the remainder by the number of units other than the home. The result is the amount used in the CalWORKs resource limit.

This is to be used when the dwelling is a duplex, triplex, etc.