First-tier Tribunal Determines Fair Rent Based on RPI Changes

OUTCOME: Allowed

First-tier Tribunal – Property Chamber File Ref No. LON/00AT/F77/2022/0051/FR

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were 63 [ADDRESS] [POSTCODE]

[NAME]

[NAME]

Tenant Mr [APPELLANT] & [NAME]

1. The fair rent is £ 224.62 inc sc Per week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 28 June 2022

3. The amount for services is £ 12.12 included Per week

4. The amount for fuel charges (excluding heating and lighting of common parts) not counting for rent allowance is

nil Per

negligible/not applicable

5. The rent is to be registered as variable.

6. The capping provisions of the Rent Acts (Maximum Fair Rent) Order 1999 apply.

7. Details (other than rent) where different from Rent Register entry

As rent register.

The landlord can charge this new rent or a lower figure but, may not charge a higher figure than the fair rent.

8. For information only: Part (a) below, applies.

(a) The fair rent to be registered is the maximum fair rent as prescribed by the Rent Acts (Maximum Fair Rent) Order 1999. The rent that would otherwise have been registered was £ 224.62 per week…… including £ 12.12 ................................ per week…………….. for services (variable).

(b) The fair rent to be registered is not limited by the Rent Acts (Maximum Fair Rent) Order 1999, because it is the same as/below the maximum fair rent of £ ......... per ................... including £ ......................................... per ................................ for services (variable) prescribed by the Order.

Chairman N [NAME] of decision 28 June 2022

MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 334.60

PREVIOUS RPI FIGURE Y 285.00

X 334.60 Minus Y 285.00 = (A) 49.6

(A) 49.6 Divided by Y 285.00 = (B) 0.1740

First application for re-registration since 1 February 1999 YES/NO

If yes (B) plus 1.075 = (C)

If no (B) plus 1.05 = (C) 1.2240

Last registered rent* 173.52 (net of sc) Multiplied by (C) = 212.39 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 212.50

Variable service charge YES / If YES add amount for services 12.12

MAXIMUM FAIR RENT = £212.62 Per week

Explanatory Note

1. The calculation of the maximum fair rent, in accordance with the formula contained in the Order, is set out above.

2. In summary, the formula provides for the maximum fair rent to be calculated by:

(a) increasing the previous registered rent by the percentage change in the retail price index (the RPI) since the date of that earlier registration and

(b) adding a further 7.5% (if the present application was the first since 1 February 1999) or 5% (if it is a second or subsequent application since that date).

A 7.5% increase is represented, in the calculation set out above, by the addition of 1.075 to (B) and an increase of 5% is represented by the addition of 1.05 to (B).

The result is rounded up to the nearest 50 pence.

3. For the purposes of the calculation the latest RPI figure (x) is that published in the calendar month immediately before the month in which the Tribunal’s fair rent determination was made.

4. The process differs where the tenancy agreement contains a variable service charge and the rent is to be registered as variable under section 71(4) of the Rent Act 1977. In such a case the

variable service charge is removed before applying the formula. When the amount determined by the application of the formula is ascertained the service charge is then added to that sum in order to produce the maximum fair rent.