First-tier Tribunal Determines Fair Market Rent for Statutory Periodic Tenancy

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. TR/LON/00BG/MNR/2023/0341

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], [POSTCODE]

Judge O’[NAME]

Landlord [RESPONDENT] [ADDRESS], [POSTCODE]

Tenant [NAME]

1. The rent is: £ 1340.60 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 11th July 2023

*3. The amount included for services is/is

negligible/not applicable £36.40 Per Month

*4. Service charges are variable and are not included

5. Date assured tenancy commenced 11th November 2019

6. Length of the term or rental period Monthly

7. Allocation of liability for repairs Landlord pursuant to s.11 LTA 1985

8. Furniture provided by landlord or superior landlord White goods

9. Description of premises 1 bedroom 2nd floor flat with open plan kitchen/living room, balcony, utility room

Chairman Judge O’Brien Date of Decision 31 January 2024

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Case Reference : TR/LON/00BG/MNR/2023/0341

Property : [ADDRESS] [POSTCODE]

Tenant

: [APPELLANT] [NAME]

Landlord : [COMPANY] of Application : Determination of a Market Rent sections 13 & 14 of the Housing Act 1988

Tribunal

: Judge Niamh O’Brien

Tribunal Member [NAME] of Summary Reasons

: 31 January 2024

_____________________________________________

DECISION

The Tribunal determines a rent of £1,340.60 from 11th July 2023 ____________________________________ FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

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© CROWN COPYRIGHT 2023

SUMMARY REASONS

Background 1. On 31st May 2023 the Landlord served a notice under Section 13(2) of the Housing Act 1988 which proposed a new rent of £1279.20 in place of the existing rent to take effect from 11th July 2023.

2. Under Section 13(4)(a) of the Housing Act 1988, the Tenant referred the Landlord’s notice proposing a new rent to the Tribunal for determination of a market rent. The Tenant’s referral was received by the Tribunal on 30th June 2023.

3. The tribunal wrote to the parties on 12 October 2023 setting out its preliminary opinion that the tribunal did not have jurisdiction as section 1.5 of the tenancy agreement provided by the applicant relates to changes in rent after the expiry of the initial 12 month fixed term, as well as containing a provision whereby the rent may be increased within the first year of the tenancy and because the applicant’s notice may not have been not served in time.

4. Following a hearing on 27 November 2024 the Tribunal determined that it did have jurisdiction to determine a new rent as the tenancy is now a statutory periodic tenancy. The Tribunal noted application was received by the tribunal on 30th June 2023, before the date specified in the landlord’s notice.

Inspection

5. The tribunal did not inspect the property but considered this case on the basis of the submissions of the parties.

The law:

6. Section 14(1) of the Housing Act 1988 provides; (1)Where, under subsection (4)(a) of section 13 above, a tenant refers to the appropriate tribunal a notice under subsection (2) of that section, the appropriate tribunal shall determine the rent at which, subject to subsections (2) and (4) below, the appropriate tribunal consider that the dwelling-house concerned might reasonably be expected to be let in the open market by a willing landlord under an assured tenancy—

3 (a)which is a periodic tenancy having the same periods as those of the tenancy to which the notice relates; (b)which begins at the beginning of the new period specified in the notice; (c)the terms of which (other than relating to the amount of the rent) are the same as those of the tenancy to which the notice relates; and (d)in respect of which the same notices, if any, have been given under any of Grounds 1 to 5 of Schedule 2 to this Act, as have been given (or have effect as if given) in relation to the tenancy to which the notice relates.

7. Section 14(7) of the Housing Act 1988 provides: “Where a notice under section 13(2) above has been referred to the appropriate tribunal, then, unless the landlord and the tenant otherwise agree, the rent determined by the appropriate tribunal (subject, in a case where subsection (5) above applies, to the addition of the appropriate amount in respect of rates) shall be the rent under the tenancy with effect from the beginning of the new period specified in the notice or, if it appears to the appropriate tribunal that that would cause undue hardship to the tenant, with effect from such later date (not being later than the date the rent is determined) as the appropriate tribunal may direct

Evidence 8. The Tribunal has considered the written submissions and evidence provided by the Tenant and in particular a listing for a one bedroom flat let on an intermediate rent in [ADDRESS]. However that property is approximately 2 miles away in Shadwell. It does not have the benefit of a balcony or additional utility room. No submissions or evidence was submitted by the landlord in relation to valuation.

Determination and Valuation 9. Having consideration of the comparable evidence provided by the parties and of our own [NAME], general knowledge of rental values in the area, we consider that the open market rent for the property would be in the region of £1630 per calendar month. From this level of rent we have made adjustments by reducing the rent by 20% to take account of the fact that the property is let at an intermediate rent.

10. The full valuation is shown below:

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Market Rent

£1630 80% Market Rent

£1304 Service charge

£36.60

TOTAL

£1340.60

Decision 11. The directions dated 28 November 2023 drew the parties attention in particular to the provisions of section 14(7) of the Housing Act 1988 as regards the start date for the new rent. We have no evidence from the Tenant as to whether it would cause him undue hardship for the new rent to take effect from the date in the Landlord’s notice. The new rent will take effect from 11th July 2023.

12. The Tribunal directs the new rent of 1340.60 to take effect on 11 July 2023, this being the date as set out in the Landlord’s Notice of Increase.

Chairman: Judge O’Brien

Date: 31 January 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 application for permission to appeal should be made on Form RP PTA.