First-tier Tribunal Determines Fair Rent for Property with Tenant Improvements

OUTCOME: Allowed

© CROWN COPYRIGHT Case Reference : BIR/00CT/F77/2025/0005 Property : 17 [ADDRESS] [POSTCODE] Tenant : [NAME] Landlord : [NAME] of Objection : 3rd December 2024 Type of Application : Section 70 Rent Act 1977 Tribunal Members : Mr [NAME] Mrs [NAME] of Decision : 17th July 2025 _______________________________________________

DECISION The sum of £332.50 per month will be registered as the fair rent with effect from 9th July 2025 being the date the Tribunal made the Decision. ____________________________________ FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

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REASONS FOR THE

DECISION 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 and having regard to its own knowledge, expertise and online research. Evidence 3. The Tribunal has considered the written submissions provided by the Tenant.

4. From the information provided it appears that the subject property comprises of a terraced house with central heating. The accommodation comprises one living room, kitchen, three bedrooms and bathroom. There is a conservatory and a car parking space. There is a rear garden.

5. The tenant submits that he has carried out the following improvements to the property: a) Install central heating b) Install double glazing. c) Fit carpets and curtains. d) Provide whitegoods. e) Fit new kitchen. f) Fit new bathroom. g) Provide garden fencing. h) Garden Landscaping.

6. The Tenant owns a 50% share of the property. Determination and Valuation 7. On consideration of the comparable evidence proved by the parties, that forwarded by the Rent Officer and the Tribunal’s own expert knowledge of rental values in the area, the Tribunal considers that the open market rent for the property in a satisfactory condition would be in the region of £1,000.00 per month.

8. From this level of rent, the Tribunal has made adjustments in relation to the following to reflect improvements by the tenant: a) Install central heating 45.00

3 b) Install double glazing. 30.00 c) Fit carpets and curtains. 30.00 d) Provide white goods. 25.00 e) Fit new kitchen. 35.00 f) Fit new bathroom. 30.00 g) Provide garden fencing. 15.00 h) Garden Landscaping. 10.00 Total £220.00 Plus: tenants decorating liability (5%) £ 50.00 Total deductions £270.00 8. The full valuation is: Market Rent £1000.00 Less tenant improvements 270.00 Base Rent 730.00 Less: a) Full repairing liability @15% 109.00 621.00 b) Management & Insurance @7% 44.00 £577.00 £577.00 x 50% = 288.50 Plus: Management & Insurance 44.00 Fair rent £332.50 10. The Tribunal determines an uncapped rent of £332.50 per month. Decision 11. The uncapped fair rent determined by the Tribunal, for the purposes of section 70, is therefore £332.50 per month from 9th July 2025. The maximum fair rent permitted by the Rent Acts (Maximum Fair Rent) Order 1999 is £358.50 per month. This therefore has no impact on the rent determined by the Tribunal. The calculation of the capped rent is shown on the decision form. Chairman: [NAME]: 17th July 2025 APPEAL PROVISIONS If either party is dissatisfied with this decision, they may apply for permission to appeal to the Upper Tribunal (Lands Chamber) on any point of law arising from this Decision. Prior to making such an appeal, an application must be made, in writing, to this Tribunal for permission to appeal. Any such application must be made within 28 days of the issue of this statement of reasons (regulation 52 (2) of The Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013) stating the grounds upon which it is intended to rely in the appeal.

4 First-tier Tribunal – Property Chamber File Ref No. BIR/OOCT/F77/2025/0005 Notice of the Tribunal Decision Rent Act 1977 Schedule 11 Address of Premises The Tribunal members were 17 [ADDRESS] [POSTCODE] [NAME] Mrs [APPELLANT] Landlord [NAME] Tenant [APPELLANT]

1. The fair rent is £332.50 Per month (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 9th July 2025 3. The amount for services is N/A Per - 4. The amount for fuel charges (excluding heating and lighting of common parts) not counting for rent allowance is N/A Per - 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: The fair rent to be registered is not limited by the Rent Acts (Maximum Fair Rent) Order 1999, because it is below the maximum fair rent of £358.50 permitted by the Order. Chairman [NAME] of decision 17th July 2025

5 MAXIMUM FAIR RENT CALCULATION LATEST RPI FIGURE X 402.9 PREVIOUS RPI FIGURE Y 290.6 X 402.9 Minus Y 290.6 = (A) 112.3 (A) 112.3 Divided by Y 290.6 = (B) 0.3864 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) 1.4364 Last registered rent* £249.46 Multiplied by (C) = £358.32 *(exclusive of any variable service charge) Rounded up to nearest 50p = £358.50 Variable service charge NO If YES add amount for services MAXIMUM FAIR RENT = £358.50 Per Month 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.