First-tier Tribunal Adjusts Rent Based on Property Condition

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. LON/00AS/MNR/2024/0329

Notice of the Tribunal Decision and Register of Rents under Assured Periodic Tenancies (Section 14 Determination)

Housing Act 1988 Section 14

Address of Premises The Tribunal members were 47 [ADDRESS], [POSTCODE]

Mr D [NAME] Mr [RESPONDENT] [NAME]

Landlord [RESPONDENT] 13, [ADDRESS], [POSTCODE]

Tenant Mr [APPELLANT] [NAME], [NAME] & [NAME]

1. The rent is: £

1,900

Per Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 11 June 2024

*3. The amount included for services is not applicable

Per

*4. Service charges are not included

5. Date assured tenancy commenced 11 July 2015

6. Length of the term or rental period Statutory Periodic Tenancy

7. Allocation of liability for repairs In accordance with agreement

8. Furniture provided by landlord or superior landlord None

9. Description of premises A 1930s built end of terrace house located in established road adjacent fields. Accommodation comprises: three bedrooms, living room, cloakroom, kitchen, shower room/wc, off street parking and rear garden.

Chairman D [NAME] of Decision 18th October 2024

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Case Reference

: LON/OOAS/MNR/2024/0329

Property : 47 [ADDRESS] [POSTCODE]

Tenant

: Mr [APPELLANT] [NAME], [NAME] & [NAME]

Landlord : [RESPONDENT] of Objection : 10 June 2024

Type of [NAME] : Determination of a Market Rent sections 13 & 14 of the Housing Act 1988

Tribunal

: Mr [NAME] Mr [NAME] of Summary Reasons

: 18 October 2024

_______________________________________________

DECISION

The Tribunal determines a rent of £1,900 per calendar month with effect from 11th June 2024. ____________________________________

FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

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SUMMARY REASONS

Background

1. On the 18 April 2024 the Landlord served a notice under Section 13(2) of the Housing Act 1988 which proposed a new rent of £2,500 per month in place of the existing rent of £1,460 per month to take effect from 11 June 2024.

2. The Tenants [NAME] is dated the 10th June 2024, under Section 13(4)(a) of the Housing Act 1988, however this is considered a typing error. The Tenant referred the Landlord’s notice proposing a new rent to the Tribunal for determination of a market rent.

3. The Tenant has lived at the property since 11 April 2011 under an Assured Shorthold Agreement which was renewed on the 11 July 2015.

Inspection and Hearing

3. A hearing to hear the parties’ representations was held at 9.30am on the 17th October 2024. The hearing was attended by tenant and the landlord represented by his solicitor Mr [COUNSEL].

4. Following the hearing, the Tribunal arrived at the property on the 17th October 2024 at 1.07 in the presence of the tenant and the landlord.

Evidence

5. The Tribunal has consideration of the extensive written submissions provided by the landlord and tenant together with comparable evidence from each party and a statement of case together with 47 photographs.

6. At the hearing, the tenant confirmed the previous rent of £1,460 per month was set by the Tribunal on the 11 April 2023. It is confirmed, the landlord has undertaken some of the schedule of works including new sanitary fittings. The Tenant confirmed he would be willing to accept a revised rent of £1750 pcm. In opposition, Mr [NAME] contended that the works of maintenance and improvement have been carried out to the property since the past decision of the Tribunal. There are only four three-bedroom houses available to rent within a one-mile radius which confirms the rental market remains extremely buoyant due to its location close to the airport. Therefore, he seeks a figure of £2,500 on behalf of the landlord.

Determination and Valuation

3 7. Firstly, having consideration of the comparable evidence together with our own expert, general knowledge of rental values in the Hayes area, we consider that the open market rent for the property in its current condition would be £2,200 per month.

8. The Tribunal now needs to adjust this rent to allow for the poor internal condition of the property, the dilapidated fence panels, defective plaster finishes and damp and mould. Using its own expertise upon the inspection, the Tribunal considers that a deduction of £300 (14%) should be applied. This reduces the rental figure to £1,900 per month.

Decision

9. The Tribunal therefore determines that the rent at which the subject property might reasonably be expected to be let in the open market by a willing Landlord under an assured tenancy in its current condition is £1,900 per calendar month.

10. The Tribunal directs the new rent of £1,900 to take effect on the 11 June 2024. This being the date set out in the Landlord’s Notice of Increase and the Tribunal was satisfied that a starting date of that specified in the Landlord’s notice would not cause the tenant undue hardship.

Chairman: [NAME]: 18 October 2024

APPEAL PROVISIONS

These summary reasons are provided to give the parties an indication as to how the Tribunal made its decision. If either party wishes to appeal this decision, they should first make a request for full reasons and the details of how to appeal will be set out in the full reasons. Any subsequent [NAME] for permission to appeal should be made on Form RP PTA.

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Case Reference

: LON/OOAS/MNR/2024/0329

Property : 47 [ADDRESS] [POSTCODE]

Tenant

: Mr [APPELLANT] [NAME], [NAME] & [NAME]

Landlord : [RESPONDENT] of Objection : 10 June 2024

Tribunal

: Mr [NAME] Mr [NAME] of Extended Reasons

: 1 November 2024

_______________________________________________

DECISION

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Decision of the tribunal

The Tribunal determines that the rent that the property in its current condition as at the 1 July 2024 might reasonably be expected to achieve in the open market under an assured periodic tenancy is £1,900 per month. Background 1. The Tribunal have prepared Extended Reasons, following a written request from the Tenant, Mr [APPELLANT] dated 25th October 2024, 2. The tenant has lived in the property as assured periodic tenant since 11 April 2011 and the Tribunal were provided with a copy of the revised tenancy agreement which commenced on the 11th July August 2015.

3. On the 18 April 2024 the Landlord served a notice pursuant to section 13(2) of the Housing Act 1988 seeking to increase the rent from £1,460 per month to £2,500 month being an increase of £1,040 effective from 11 June 2024.

4. By an [NAME] dated 10th June 2024, the tenant referred that Notice to the Tribunal for a determination of the market rent.

5. The tenant requested a hearing and inspection to determine this matter and the Tribunal agreed with this arrangement. Background 6. The Tribunal has before it a bundle of evidence which includes a background to the case and the Directions. Each of the parties completed the Rent Appeal Statement and comprehensive submissions which included 47 photographs and details of comparable evidence.

Inspection and Hearing

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7. A hearing to hear the parties representations was held at 9.30am on the 17th of October 2024. The landlord was represented by his solicitor Mr [COUNSEL] and the tenant represented himself. Following the hearing, the Tribunal arrived at the property on the 17th of October 2024 at 1.07 in the presence of the tenant and the landlord. At the hearing, the tenant confirmed the previous rent of £1,460 per month was set by the Tribunal on the 11th of April 2023. It was confirmed the landlord has undertaken the majority of the schedule of works including new sanitary fittings. The Tenant confirmed he would be willing to accept a revised rent of £1,750 per month. In opposition, Mr [NAME] contended that the works of maintenance and improvement have been carried out to the property since the past decision of the Tribunal. He confirmed that following his own investigations on “Rightmove” there are only four three bedroom houses available to rent within a one mile radius which confirms the rental market remains extremely buoyant due to its location close to Heathrow Airport. Therefore, he seeks a figure of £2,500 0n behalf of the Landlord.

8. The property is an end of terrace, two storey house with dormer windows on the first floor. There are three bedrooms and a bathroom on the first floor. On the ground floor is a kitchen, WC and a large L-shaped room currently being used as a bedroom/living room. The rooms lead’s via French doors in a basic porch structure which leads in the good size rear garden. The house is located at the end of the road, lying adjacent open fields.

9. The front of the property has a gravel drive for off street parking and the fence panels are dilapidated. The state of decoration was throughout, at best tired, and at worst in poor condition. The carpets were dated and the odd ceramic tile in the kitchen is cracked and damaged. The white goods, carpets and curtains were provided by the landlord. There was gas central heating.

The Law 10. The rules governing a determination are set out in section 14 of the Housing Act 1988. In particular, the Tribunal is to determine the rent at which the property might reasonably be expected to be let in the open market by a willing landlord under an assured tenancy, subject to disregards in relation to the nature of the tenancy (i.e. it being granted to a “sitting tenant”) and any increase or reduction in the value due to the tenant’s improvements or failure to comply with the terms of the tenancy. In the absence of any evidence to the contrary, the Tribunal

4 has proceeded on the basis that the landlord is responsible for repairs to the structure, exterior and any installations pursuant to section 11 of the Landlord and Tenant Act 1985 and the tenant for interior decoration. The Valuation 11. Having carefully considered all the evidence the Tribunal considers that an achievable rent for the property in a good marketable condition with reasonably modern kitchen and bathroom fittings, modern services with carpets curtains and white goods provided by the Landlord would be £2,200 per month. This figure is based upon the comparable evidence provided by the parties and the Tribunal’s professional judgement and experience in the Hayes area.

12. From this level of rent we have made adjustments in relation to: the poor internal condition of the property, the dilapidated fence panels, defective plaster finishes, cracked kitchen floor tiles and evidence of damp and mould. which equates to approximately 14% (£300) This reduces the rental figure to £1,900 per month.

13. The average rent for rental properties in the Hayes area has increased every quarter since the end of 2020, according to the online property portal Rightmove. The rent increases are due to a poor supply of properties coming to the market to meet demand and the number of homes for rent is approximately 40 per cent below 2020 levels. This puts this decision in context with the current rental market. Decision

14. The Tribunal therefore determined that the rent at which the subject property might reasonably be expected to be let in the open market by a willing Landlord under an assured tenancy in its current condition was £1,900 per calendar month.

15. The Tribunal directs the new rent of £1,900 per month to take effect on the 11th June 2024. This, being the date set out in the Landlord’s Notice of Increase.

Chairman: [NAME]: 1st November 2024

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Rights of appeal

By rule 36(2) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, the tribunal is required to notify the parties about any right of appeal they may have. If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber), then a written [NAME] for permission must be made to the First-tier Tribunal at the [NAME] which has been dealing with the case. The [NAME] for permission to appeal must arrive at the [NAME] within 28 days after the tribunal sends written reasons for the decision to the [NAME]. If the [NAME] is not made within the 28-day time limit, such [NAME] must include a request for an extension of time and the reason for not complying with the 28-day time limit; the tribunal will then look at such reason(s) and decide whether to allow the [NAME] for permission to appeal to proceed, despite not being within the time limit. The [NAME] for permission to appeal must identify the decision of the tribunal to which it relates (i.e. give the date, the property and the case number), state the grounds of appeal and state the result the party [NAME] the [NAME] is seeking. If the tribunal refuses to grant permission to appeal, a further [NAME] for permission may be made to the Upper Tribunal (Lands Chamber).