Joint Tenancy/Care Home Fees

Rippledipples

Hi, i (daughter) have a joint tenancy with my Dad on the property we both live in, the property is now mortgage free, if my Dad needed care at home or to go into a care home in the future would the property value form part of the assessment by the council for paying the care home fees even though he does not own it outright? 

Keep_pedalling

His ownership of the house will not be taken into account for care at home just his savings and income. It’s a bit more complicated for residential care, if you are over 60 the house would be disregarded but if you are younger ir won’t.

Is there a reason you are joint tenants rather than tenants in common? Unless you are happy for your father to inherit by survivorship if you die first, you should split the tenancy and make a will.

NedS

Where the property is jointly held, the value for any care home costs consideration would depend on a willing buyer on the open market, and if you do not wish to sell then a willing buyer is unable to realise it's value.

The local authority would have to be able to force a sale of the whole property through the courts to realise the value, and the courts are unlikely to grant that giving you are living in the property and that it is your only home (and was purchased jointly with your father for the sole reason of being your only home)?

So yes, your Dad's share of any beneficial interest the property is treated as capital, but in order to value that beneficial interest, there must be a willing buyer on the open market. They cannot just take the 'market value' of the property and divide it in half, as his beneficial interest will depend on how attractive it is to purchase, and that may be nil given you do not (presumably) wish to sell the property.

bobster2

NedS said:

Where the property is jointly held, the value for any care home costs consideration would depend on a willing buyer on the open market, and if you do not wish to sell then a willing buyer is unable to realise it's value.

The local authority would have to be able to force a sale of the whole property through the courts to realise the value, and the courts are unlikely to grant that giving you are living in the property and that it is your only home (and was purchased jointly with your father for the sole reason of being your only home)?

So yes, your Dad's share of any beneficial interest the property is treated as capital, but in order to value that beneficial interest, there must be a willing buyer on the open market. They cannot just take the 'market value' of the property and divide it in half, as his beneficial interest will depend on how attractive it is to purchase, and that may be nil given you do not (presumably) wish to sell the property.

OP didn't indicate anything about this point in bold being the case - i.e. that they purchased it together. Joint ownership involving a parent and child often arises in other ways.

But more importantly - a sale does not need to occur for the local authority to include the value of a property in a financial assessment. They will conduct a valuation.

Of course, a sale would have to occur for any equity to be actually used to fund care home fees - but this could be through a deferred payment agreement.

And for anyone who has been lured down the "nil value" rabbit hole on the internet. Take a look a this ruling from Local Government & Social Care Ombudsman involving jointly owned property.

https://www.lgo.org.uk/decisions/adult-care-services/assessment-and-care-plan/19-007-028

Yes - they determined that Essex County Council had got the valuation process wrong at first - and ordered them to pay a small amount of compensation.

But note - the council asserted that "Reviewing sales evidence, there are Auctioneers specialising in the sale of similar part interests where family members continue to reside at the property rent free, indicating there is a market for a part share in such a property."

And the Ombudsman stated - "I did not find fault with the process through which the Council arrived at a final valuation"

Linton

NedS said:

Where the property is jointly held, the value for any care home costs consideration would depend on a willing buyer on the open market, and if you do not wish to sell then a willing buyer is unable to realise it's value.

The local authority would have to be able to force a sale of the whole property through the courts to realise the value, and the courts are unlikely to grant that giving you are living in the property and that it is your only home (and was purchased jointly with your father for the sole reason of being your only home)?

So yes, your Dad's share of any beneficial interest the property is treated as capital, but in order to value that beneficial interest, there must be a willing buyer on the open market. They cannot just take the 'market value' of the property and divide it in half, as his beneficial interest will depend on how attractive it is to purchase, and that may be nil given you do not (presumably) wish to sell the property.

Except in extreme cases the LA wont need to force a sale through the courts.  They simply state that, based on the financial assessment, they wont pay for care home costs.  What you and your family do about it is your problem.  If you dont like the council's decision you can appeal, to the courts if necessary.

NedS

bobster2 said:

NedS said:

Where the property is jointly held, the value for any care home costs consideration would depend on a willing buyer on the open market, and if you do not wish to sell then a willing buyer is unable to realise it's value.

The local authority would have to be able to force a sale of the whole property through the courts to realise the value, and the courts are unlikely to grant that giving you are living in the property and that it is your only home (and was purchased jointly with your father for the sole reason of being your only home)?

So yes, your Dad's share of any beneficial interest the property is treated as capital, but in order to value that beneficial interest, there must be a willing buyer on the open market. They cannot just take the 'market value' of the property and divide it in half, as his beneficial interest will depend on how attractive it is to purchase, and that may be nil given you do not (presumably) wish to sell the property.

OP didn't indicate anything about this point in bold being the case - i.e. that they purchased it together. Joint ownership involving a parent and child often arises in other ways.

But more importantly - a sale does not need to occur for the local authority to include the value of a property in a financial assessment. They will conduct a valuation.

Of course, a sale would have to occur for any equity to be actually used to fund care home fees - but this could be through a deferred payment agreement.

And for anyone who has been lured down the "nil value" rabbit hole on the internet. Take a look a this ruling from Local Government & Social Care Ombudsman involving jointly owned property.

https://www.lgo.org.uk/decisions/adult-care-services/assessment-and-care-plan/19-007-028

Yes - they determined that Essex County Council had got the valuation process wrong at first - and ordered them to pay a small amount of compensation.

But note - the council asserted that "Reviewing sales evidence, there are Auctioneers specialising in the sale of similar part interests where family members continue to reside at the property rent free, indicating there is a market for a part share in such a property."

And the Ombudsman stated - "I did not find fault with the process through which the Council arrived at a final valuation"

Indeed, and as that judgement highlights, the valuation must be based on the price a willing buyer would pay to a willing seller.