The correct option is A Have
The sentence mentions that the 'they' own a house in Shimla. From the given options, was and were are past tense (singular and plural respectively) of the verb 'be' and so options A and B are incorrect. option D) 'is' indicates third person state in present and so is incorrect. Option C) 'have' is used to show someone owns or possesses something. Therefore, the correct answer is option C) have and the complete sentence is: They have a house in Shimla.