First-tier Tribunal Determines Fair Rent for Residential Property

OUTCOME: Allowed

FR24 First-tier Tribunal – Property Chamber File Ref No. TR/LON/00AU/F77/2024/0009

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

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

Mr D [NAME] [NAME]

Landlord Northumberland and [APPELLANT]

Tenant Mr & Mrs [APPELLANT] and [APPELLANT]

1. The fair rent is £952.00 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 19th March 2024

3. The amount for services is

Per

negligible

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

0.00 Per

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 not limited by the Rent Acts (Maximum Fair Rent) Order 1999, because it is below the maximum fair rent of £1041 per month.

[NAME] [NAME] of decision 19th March 2024

FR24 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 378

PREVIOUS RPI FIGURE Y 317.7

X 378 Minus Y 317.7 = (A) 60.3

(A) 60.3 Divided by Y 317.7 = (B) 0.189

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) 1.239

Last registered rent* 840 Multiplied by (C) = 1040.76 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 1041

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £1041 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.

1

Case Reference

: LON/00AU/F77/2024/0009

Property : [ADDRESS] [POSTCODE]

Tenant

: Mr [APPELLANT]

Landlord : [APPELLANT] of Objection : 5 December 2023

Type of Application : Section 70, Rent Act 1977

Tribunal

: Mr [NAME] [NAME] [NAME] of Summary Reasons

: 19 March 2024

_______________________________________________

DECISION

The sum of £970.23 per calendar month will be registered as the fair rent with effect from 19 March 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 and Hearing

2. A hearing took place at 9.30am on the 19 March 2024 attended by the tenant’s son Mr [APPELLANT]. An inspection of the property took place on the 19 March 2024 following the hearing in the presence of the tenant.

Evidence 3. The Tribunal received a completed Reply Form from the tenant and not written submissions from the landlord

Determination and Valuation 4. Having consideration of our own expert, general knowledge of rental values in the Shepherd’s Bush area, we consider that the open market rent for the property in its current condition would be in the region of £1,700 per calendar month. From this level of rent we have made adjustments in relation to:

Terms of tenancy, no white goods, no carpets or curtains, defective windows, no central heating which equates to approximately 30%

5. The Tribunal has also made an adjustment for scarcity at 20%

6. The full valuation is shown below:

Market Rent £1700 pw

Less

approx. 30% £510

£1,190

Less Scarcity

approx. 20%

238

£952.00

3

Decision

7. The uncapped fair rent initially determined by the Tribunal, for the purposes of section 70, was £970.23 per calendar month. The capped rent for the property according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £1041.00 per calendar month. The calculation of the capped rent is shown on the decision form.

8. In this case therefore the lower rent of £970.23 per calendar month is to be registered as the fair rent or this property.

Chairman: [NAME] [NAME]: 19 March 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