It has now been more than one year since the new California homestead exemptions went into effect. To recap…
Prior to January of 2021, the homestead exemptions in California were $75,000 for single persons, $100,000 for a “family unit” (married and/or with dependents), and $175,000 for the elderly and disabled. The new homestead exemptions are now significantly increased and vary depending on which county you reside in. The minimum homestead exemption is $300,000, and the maximum homestead exemption is $600,000. The homestead exemption amount in any particular county is based on “the countywide median sale price for a single-family home” in the prior year.
For counties like Orange and Los Angeles, where it is undisputed that the countywide median sales price is well over $600,000, this is fairly easy to calculate since the exemption is capped at $600,000. Therefore the homestead exemption in these counties is $600,000. Things get a little tricky when looking at counties with a median sales price below $600,000, such as Riverside and San Bernardino. Unfortunately, the legislature did not specify what source determines these figures. Zillow is not a credible source, the census is only done every 10 years… so what is controlling?
Somehow, this question remains unanswered. Many of us in the legal community have cited the California Association of Realtors’ published housing and sales data since they are a reasonably credible source. As of the date of this article, this information has not yet been published. However, going by estimates from other sources online, it appears that the homestead exemption in Riverside is now somewhere between $525,000 and $588,000 and the homestead exemption in San Bernardino is somewhere between $430,000 and $470,000. Both of these figures are up by about $100,000 from last year, which seems to accurately coincide with how much home values have sky-rocketed in the past two years.
It is still undisputed that the homestead exemptions in Orange, Los Angeles, and San Diego Counties remain at the $600,000 cap.
For more information about the new homestead exemptions, as well as other major factors that can be relevant when it comes to protecting your home in bankruptcy, please read my earlier post from when the laws went into effect.
