First-tier Tribunal Adjusts Rent Based on Property Condition

OUTCOME: Allowed

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 169B [ADDRESS], [POSTCODE]

Prof Richard Percival Mrs [RESPONDENT] MA MRICS

Landlord [NAME] 39B [ADDRESS], [POSTCODE]

Tenant Mr [APPELLANT] & Ms [APPELLANT]

1. The rent is: £ 243.00 Per Week (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 23 December 2019

*3. The amount included for services is/is

negligible/not applicable

Per

*4. Service charges are variable and are not included

5. Date assured tenancy commenced 23 December 2019

6. Length of the term or rental period Weekly

7. Allocation of liability for repairs S.11 L&T Act 1985

8. Furniture provided by landlord or superior landlord N/A

9. Description of premises 3 bed maisonette on 1st & 2nd floor in mid-Victorian terraced property. Centrally located.

Chairman Prof Richard Percival Date of Decision 14 Feb 2020

First-tier Tribunal – Property Chamber File Ref No. LON/00AP/MNR/2019/0157

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : LON/00AP/MNR/2019/157 Property : 169 [ADDRESS] [POSTCODE] Tenant : Mrs [COUNSEL] and Mr [COUNSEL] : N/A Landlord : Mr and Mrs [COUNSEL] [NAME] : A1 Lettings and Management Type of Application : Determination under Housing Act 1988, section 14

Tribunal Members : Tribunal Judge Richard Percival Mrs A Flynn MA MRICS Date of Inspection and Hearing :

14 February 2020

Issue of Reasons

: # July 2020

REASONS

The application 1. On 21 November 2019, following the death of the tenants mother, the landlord served a notice under Housing Act 1988, section 13(2) proposing a new rent from 23 December 2019 of £405 per week, in place of the existing rent of £225 per week. On 11 December 2019, the tenant applied to the First Tier Tribunal (Property) for determination under Housing Act 1988 section 14.

2. The hearing and inspection took place on 14 February 2020, and the Tribunal made our decision on the same day. However, the Respondent’s request for extended reasons was inadvertently overlooked by the judge (not the Tribunal’s administration), as a result of which these reasons have been delayed. Most of the delay is attributable to the disruption caused by subsequent events relating to the coronavirus pandemic. The judge apologises to the parties for the delay.

Inspection 3. The property was inspected on 14 February 2020 in the presence of Mr and Mrs [NAME].

4. The property is a self-contained maisonette on the first and second floors of a late nineteenth or early twentieth century property. The hall, kitchen, bathroom, sitting room and one bedroom are located on the first floor, and the other two bedrooms on the second floor.

5. On inspection, in the kitchen we found that the units were very old and in a poor condition. The taps and the white goods had been provided by the tenant. The relatively new uPVC window had been installed by the landlord. There was significant damp on one wall. The bathroom also suffered from damp. The tiles below the bath were broken, such that the tenant used plastic bags to stop water from the bath etc from entering. The avocado bath and WC were dated in a poor condition. The WC leaked. The bedroom on the first floor also suffered from damp below the window. The state of carpet was very poor, as was the general decorative state. In the sitting room, the frames of the original windows were rotting and leaking. The carpet and curtains had been provided by the tenant.

6. The smaller of the two bedrooms on the second floor was damp to the extent of being for practical purposes uninhabitable. The window was broken. The decorative state was very poor. The larger bedroom on this floor also suffered from some damp under the window, but not to the extent of the small room.

7. Viewed externally, it could be seen that all of the windows (save that in the kitchen) were a very poor state of repair.

8. The inspection confirmed the tenants’ statement and the photographs they supplied.

The law 9. Under the Housing Act 1988, section 14, the Tribunal must determine the rent that would be obtained in respect of the same property on a new letting on the open market by a willing landlord under an assured tenancy, on otherwise similar terms (other than rent) to the existing tenancy. The rent so determined

must, however, disregard the effect on the rent of the granting of the tenancy to a sitting tenant; any increase in the value of the property as a result of improvements carried out by the tenant during the tenancy (or a previous tenancy), otherwise than as a result of his or her obligations to the landlord under the lease; or any reduction attributable to a failure to comply with such an obligation. The rent does not include a service charge, but does include sums payable for furniture or council tax.

Determination 10. The Tribunal first assessed the market price that would be achieved for a new letting, in a condition that would be expected of the flat if it were to be marketed now.

11. The Tribunal took into account the comparables provided by the landlord, and assessed the likely market price (in the condition provided above) with regard to the size and desirability of the flat in relation to the comparables. The landlord’s comparables were regarded as a guide rather than definitive – some were, for instance, purpose built flats or houses. The Tribunal took account of our knowledge and experience of the market.

12. The Tribunal considered that the realistic range of comparable properties, as let, was between £350 and £405 per week. We concluded that the appropriate starting point was a market rent in good condition and disregarding tenant’s improvements was £405 a week.

13. The Tribunal then took account of the condition of the flat, as compared with that to expected in a newly marketed flat in current conditions, and of the tenant’s improvements.

14. Deductions were due for the tenants improvements (white goods, some carpets and curtains), and, in particular, for the damp encountered throughout the flat, which was a major issue throughout, and for the extremely poor decorative state throughout, except to the limited extent that the tenant had supplied carpets. In the result, the Tribunal concluded that the starting point letting price should be reduced by 40%, resulting in an adjusted market rent of £243 per week with effect from 16 December 2019.

Name: Tribunal Judge Professor Richard Percival Date: 28 July 2020