First-tier Tribunal Determines Fair Rent for Property

OUTCOME: Allowed

FR24 First-tier Tribunal – Property Chamber File Ref No. TR/LON/00AG/F77/2024/0196

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

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

[NAME]

Landlord [COMPANY]

Tenant Mr [APPELLANT] & Mr [APPELLANT]

1. The fair rent is £196.00 Per Week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 27 August 2024

3. The amount for services is n/a Per

negligible/not applicable

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

0.00 Per

negligible/not applicable

5. The rent is not to be registered as variable.

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

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

8. For information only:

(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 £320 per week including £0 per week for services (variable).

[NAME] of decision 27 August 2024

FR24 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 387.3

PREVIOUS RPI FIGURE Y 255.4

X 387.3 Minus Y 255.4 = (A) 131.9

(A) 131.9 Divided by Y 255.4 = (B) 0.51645

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) 1.56645

Last registered rent* £125 Multiplied by (C) = £195.80 *(exclusive of any variable service charge)

Rounded up to nearest 50p = £196.00

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £196 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.

1

Case Reference

: LON/00AG/F77/2024/0196

Property : [ADDRESS], [POSTCODE]

Tenant

: Mr [APPELLANT], Mr [APPELLANT] and Mr [APPELLANT]

Landlord : [COMPANY] of Objection : 26 March 2024

Type of Application : Section 70, Rent Act 1977

Tribunal Member : [NAME] of Summary Reasons

: 27 August 2024

_______________________________________________

DECISION

The sum of £196 per calendar week will be registered as the fair rent with effect from 27 August 2024, being the date the Tribunal made the Decision. ____________________________________

© CROWN COPYRIGHT 2024

FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

2 SUMMARY REASONS

Background

1. Following an objection from the Tenant to the determination of a fair rent by the Rent Officer, the Tribunal has made a determination under the provisions of the Rent Act 1977.

Inspection

2. The Tribunal did not inspect the property but considered this case on the basis of the papers provided by the parties.

Evidence

3. There were no written submissions from the parties following Directions issued on 11 June 2024. The Tribunal has considered of the documentation forwarded by the Rent Officer on 26 March 2024.

Determination and Valuation

4. On consideration of the evidence forwarded by the Rent Officer and the Tribunal’s own expert knowledge of rental values in the area, the Tribunal agrees with the Rent Officer and considers that the open market rent for the property in a satisfactory condition would be in the region of £500 per calendar week. From this level of rent, the Tribunal has made adjustments in relation to the Tenant’s internal decoration liability and Tenant’s provision of white goods, floor coverings and curtains.

5. The Tribunal has also made an adjustment for scarcity using their own general knowledge and experience. The Tribunal considers that in the wider geographical area there is an imbalance of supply and demand impacting on rental values and has, therefore, made a reduction of 20% for scarcity.

6. The full valuation is shown below:

per calendar week Market Rent

£500

Less Tenant’s internal decoration liability

) Floor coverings, curtains and white goods ) approx. 20% £100

£400

Less Scarcity

approx. 20% £ 80

£320

7. The Tribunal determines an uncapped rent of £320 per calendar week.

3 Decision

8. The uncapped fair rent determined by the Tribunal, for the purposes of section 70, is £320 per calendar week. The capped rent for the property according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £196.00 per calendar week. The calculation of the capped rent is shown on the decision form. In this case the lower rent of £196.00 per calendar week is to be registered as the fair rent of this property.

Chairman: [NAME]: 27 August 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 request for full reasons should be made within a month. Any subsequent application for permission to appeal should be made on Form RP PTA