First-tier Tribunal Determines Fair Rent for Property

OUTCOME: Allowed

First-tier Tribunal – Property Chamber File Ref No. LON/00AW/F77/2024/0194

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were 10 [ADDRESS], [POSTCODE]

[NAME] LL.B Mrs [APPELLANT]. [APPELLANT]

Landlord [APPELLANT]

Tenant Mrs [APPELLANT]

1. The fair rent is £8877.50 Per quarter (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 31 July 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

N/A 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 £ 8,944 per quarter

[NAME] of decision 31 July 2024

MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 387.3

PREVIOUS RPI FIGURE Y 314.3

X 387.3 Minus Y 314.3 = (A) 73

(A) 73 Divided by Y 314.3 = (B) 0.2323

First application for re-registration since 1 February 1999 NO

If yes (B) plus 1.075 = (C) N/A

If no (B) plus 1.05 = (C) 1.2823

Last registered rent* £6,923 Multiplied by (C) = £8,877.36 *(exclusive of any variable service charge)

Rounded up to nearest 50p = £8,877.50

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £8,877.5 Per quarter

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.

Case Reference

: LON/00AW/F77/2024/0194

Property : 10 [ADDRESS] [POSTCODE]

Tenant

: Mrs [APPELLANT] J [APPELLANT]

Landlord : [APPELLANT] of Objection : 15 November 2023

Type of Application : Section 70, Rent Act 1977

Tribunal

: J.[NAME] LL.[NAME] of Summary Reasons

: 31 July 2024

_______________________________________________

DECISION

The sum of £8,877.50 will be registered as the fair rent with effect from 31 July 2024, being the date the Tribunal made the Decision. ____________________________________

© CROWN COPYRIGHT 2023

FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

SUMMARY REASONS

Background 1. Following an objection from the Landlord 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 Landlord and the Tenant.

Evidence 3. The Tribunal has considered the written submissions provided by the the Landlord, in particular the Report prepared by [COUNSEL], the Landlord’s representative. It has also considered the information provided by the tenant.

Determination and Valuation 4. Having considered the comparable evidence proved by the Landlord, in particular the comparables offered of [ADDRESS] (let in March 2024 at £96,200 p.a.) and [ADDRESS] (let in November 2023 at £137,800 p.a.) and our own expert, general knowledge of rental values in the area, we consider that the open market rent for the property in good tenantable condition would be in the region of £111,800 p.a.

From this level of rent we have made adjustments in relation to the extent to which the lease terms differ from those of an assured shorthold tenancy (as to repair and insurance in particular) and the condition in which the property was let (without white goods, floor coverings or curtains) and the tenant’s provision of central heating.

5. The Tribunal has also made an adjustment for scarcity.

6. The full valuation is shown below:

Per quarter Market Rent

£27,950

Less Lease terms

) Letting condition

)

) approx. 60% )

£16,770

£11,180

Less Scarcity

approx. 20%

£2,236

£8,944

7. The Tribunal determines a fair rent of £8,944 per quarter

Decision 8. The uncapped fair rent initially determined by the Tribunal, for the purposes of section 70, was £8,944. The capped rent for the property according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £8,877.50. The calculation of the capped rent is shown on the decision form. In this case the Maximum Fair Rent of £8,877.50 is to be registered as the fair rent for this property.

Chairman: [NAME]: 31 July 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