First-tier Tribunal Adjusts Rent Based on Property Condition

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. BIR/37UC/MNR/2022/0042

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 [ADDRESS], Shireoaks, Worksop, Nottinghamshire, [POSTCODE]

[NAME] Mrs [RESPONDENT]

Landlord [RESPONDENT] & [NAME] (Joint Inheritors) [ADDRESS], [POSTCODE]

Tenant [NAME]

1. The rent is: £555.00 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 01 June 2022

3. The amount included for services is not applicable N/A Per N/A

4. Service charges are variable and are not included

5. Date assured tenancy commenced 01 March 2016

6. Length of the term or rental period 12 Months

7. Allocation of liability for repairs As per tenancy agreement and Landlord & Tenant Act

8. Furniture provided by landlord or superior landlord None

9. Description of premises A mid-terraced house comprising lounge, inner-hallway and dining kitchen. On the first floor are 1 double and 1 small single bedroom and bathroom. Second floor attic bedroom. Gas central heating (not to attic). Double glazing. Front forecourt. Rear-yard & stores.

[NAME] of Decision 11/08/2022

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : BIR/37UC/MNR/2022/0042 Property : [ADDRESS] Worksop [POSTCODE] Applicant : [redacted] : None Respondent : [redacted] : Mr [COUNSEL] of application : Application under Section 13(4) of the Housing Act 1988 referring a notice proposing a new rent under an Assured Periodic Tenancy to the Tribunal Tribunal members : [NAME] S [NAME] Mrs [NAME] and Date of Determination : 11th August 2022

DETAILED REASONS

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BACKGROUND

1. On 23rd May 2022, the Applicant (tenant of the above property) referred to the Tribunal, a notice of increase of rent served by the Respondent (landlord of the above property) under section 13 of the Housing Act 1988.

2. The Respondent’s notice, which proposed a rent of £650.00 per month with effect from 1st June 2022, is dated 26th April 2022.

3. The date the tenancy commenced is stated on the Application Form as being 1st March 2016 and is an Assured Shorthold Tenancy. The current rent is stated as being £350.00 per month which was the rent at the commencement of the tenancy.

INSPECTION

4. The Tribunal inspected the property on 11th August 2022 in the presence of the Applicant. The Respondents did not attend the inspection. The property comprises of a mid-terraced cottage being of brick construction surmounted by a pitched slate roof. It is located in a rural village. There are local shops and facilities.

5. Briefly the accommodation comprises of front lounge which leads to an inner hallway with stairs off to the first floor and rear kitchen fitted with a range of base and wall cupboards. There is a new inset stainless-steel sink and a built-in oven/hob. The central heating and domestic hot water are provided by a Baxi wall mounted gas fired boiler.

6. To the first floor the landing leads to one double bedroom, one single bedroom and bathroom being fitted with a three-piece sanitary suite and extractor fan.

7. A steep staircase from the first-floor landing leads to the second-floor attic double bedroom which is plaster boarded but does not have a plaster skim.

8. The property has upvc double glazing (although this is not particularly modern and some repairs are required). Although there is gas fired central heating to the ground and first floors this does not extend to the second-floor attic bedroom where there is only a wall mounted electric convector heater. Floor coverings and curtains are provided by the Respondent.

9. To the front of the house is a small garden and to the rear a small rear yard/garden with old W.C and two store sheds in very poor condition. There is no practical rear access to the garden from the road.

10. The property was found to be in reasonable general condition throughout commensurate with its age and type although the Tribunal noted that it did not compare favourably with a modern property.

EVIDENCE

11. The committee received written representations from both parties which were copied to the other party.

12. A hearing was arranged by [NAME] on 11th August 2022, following the inspection. This was attended by the Applicant and the Respondent’s representative.

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13. At the commencement of the hearing the Tribunal asked the parties to confirm the position regarding the current rental payment and it was confirmed that the rent of £350.00 per month had not increased since the commencement of the tenancy.

14. In her written submission and at the hearing the Applicant submitted:

1) The proposed rent was too high as the property had been in disrepair since the commencement of the tenancy. The neighbouring property paid £595.00 per month with a kitchen extension and utility room in an outhouse.

2) That other nearby properties that were let were fully modernised and well maintained. The attic was neither plastered or decorated.

3) That there was mould in four places in the property. The Applicant had experienced breathing problems and was of the opinion that this was the cause.

4) That although the Environmental Health Officer from the local authority had inspected and produced a schedule of works, the standard of those works was in many cases poor. The Environmental Health Officer had not checked all the areas where damp had been but had confirmed that the works were completed.

5) That she had carried out some repairs herself including sweeping the chimney, which the Respondent had then bricked up.

6) That electric cables were visible beneath the bath when the bath panel was removed. (This was shown to the Tribunal during the inspection).

7) That the electric hob was second hand and that the electrics tripped when the oven and hob were used at the same time.

8) That the property was damp before the work was completed but there was still black mould to the rear of the sink and in the front double bedroom. (The Applicant submitted that she washed pots upstairs due to the mould to the rear of the sink).

9) That areas of damp (for example to the rear of the sink) had been covered up.

10) That repairs were required to some windows.

15. In its written submission and at the hearing the Respondent submitted:

1) That in the survey referred to in the witness statement the presence of black mould was not noted in December 2021.

2) That low level moisture readings were found but that the works had been carried out as specified by Bassetlaw District Council.

3) That ongoing moisture was expected to be found as the property was still likely to be ‘drying out’.

4) That based on Rightmove the ‘average’ rental of a two-bedroom house, regardless of condition or location was £500.00 per month.

THE LAW

16. In accordance with the terms of section 14 Housing Act 1988 the Tribunal proceeded to determine the rent at which it considered that the subject property might reasonably be expected to be let on the open market by a willing landlord under an assured tenancy.

17. In so doing the Tribunal, as required by section 14(1), ignored the effect on the rental value of the property of any relevant tenant's improvements as defined in section 14(2) of that Act.

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THE TRIBUNAL’S DECISION

18. The Tribunal determined that the cottage was a fairly attractive property which would appeal to a wide range of tenants.

19. The Tribunal noted that although the property was generally modernised the standard of work was not of the best. The property was double glazed although some repairs were required and the fitted kitchen was poor.

20. Although the attic bedroom had been plaster boarded it had not been finished off with a plaster skim. The Respondent submitted that it was not possible to complete this work as the Applicant was using the room but the fact remains that it is not finished and the Tribunal is required to take account of the present condition in assessing the rental value.

21. The Tribunal noted the areas of black mould pointed out by the Applicant but, in the opinion of the Tribunal these are not all as detrimental as the Applicant submits.

22. The Respondent is now proposing a rent of £650.00 per month. The property includes an oven and hob but these are of poor quality. Carpets and curtains are adequate.

23. The Tribunal determined that an open market rent of £600.00 per month would be appropriate for the property as offered if in good condition but that deductions were required to reflect the present state of repair.

24. The Tribunal therefore considered the various monthly deductions to reflect the items referred to above as follows:

No central heating to the attic bedroom 5.00 Attic bedroom requires plastering 15.00 Kitchen -poor oven/hob and general fitting 10.00 Repairs to double glazing 5.00 Poor general standard of work completed 8.00 Condition of outbuildings 2.00 Total £45.00

25. In coming to its decision, the Tribunal had regard to the comparables provided by the parties and the members' own general knowledge of market rent levels in the area of Nottinghamshire, South Yorkshire and Derbyshire. The Tribunal concluded that an appropriate market rent for the property would be £555.00 per month (£600.00 - £45.00)

26. The Tribunal therefore determined that the rent at which the property might reasonably be expected to be let on the open market would be £555.00 per month.

27. The Tribunal then considered the question of hardship on the part of the Applicant. Although this was referred to in the Applicant’s written submissions it was not referred to by the Applicant at the hearing.

28. The Tribunal understands that the Applicant receives both Housing benefit and an Employment and Support Allowance. At the same time the Tribunal accepts, as confirmed by the parties that the rent has not increased since the commencement of the tenancy in March 2016.

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29. Having given the matter careful consideration the Tribunal determined that the rent will take effect from 1st June 2022, being the date of the Respondent’s notice.

APPEAL

30. Any appeal against this Decision must be made to the Upper Tribunal ([NAME]). Prior to making such an appeal the party appealing must apply, in writing, to this Tribunal for permission to appeal within 28 days of the date of issue of this Decision, (or, if applicable, within 28 days of any decision on a review or application to set aside) identifying the decision to which the appeal relates, stating the grounds on which that party intends to rely in the appeal, and stating the result sought by the party making the application.

[NAME] First-tier Tribunal Property Chamber (Residential Property)