First-tier Tribunal Determines Fair Rent for Tenants

OUTCOME: Allowed

FR24 First-tier Tribunal – Property Chamber File Ref No. LON/00AM/F77/2019/0155

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were Flat 88 [NAME], [ADDRESS], [POSTCODE]

Ms [NAME] BA (Hons) DipLaw LLM Mrs [APPELLANT] MA MRICS

Landlord [RESPONDENT] [COMPANY]

Tenant [NAME] [APPELLANT]

1. The fair rent is £173.50 Per Week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 08 November 2019

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

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

5th floor flat

8. For information only:

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 £210 per week.

Chairman Ms [NAME] BA (Hons) DipLaw LLM Date of decision 8/11/19

FR24 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 291

PREVIOUS RPI FIGURE Y 272.9

X 291 Minus Y 272.9 = (A) 18.1

(A) 18.1 Divided by Y 272.9 = (B) 0.006325

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) 1.116325

Last registered rent* 155 Multiplied by (C) = 173.03 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 173.50

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £173.50 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.

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case Reference : LON/00AM/F77/2019/0155 Property : Flat 88, [NAME], [ADDRESS] [POSTCODE] Applicant: [redacted] :

N/A Respondent: [redacted] : [RESPONDENT] of Application : Fair rent Tribunal Members : Judge Tagliavini Mrs A Flynn MA MRICS Date and venue of Hearing

: 8 [ADDRESS] [POSTCODE]

Date of Decision

: 8 November 2019 (Reasons provided 8 December 2019)

DECISION

2 Decision of the tribunal

I The tribunal determines that the fair rent payable is £173.50 per week with effect from 8 November 2019.

_________________________________________________

The application

1. This is an objection to the fair rent registered by the Rent Officer of £172.00 per week with effect from 11 September 2019 pursuant to the provisions of the Rent Act 1977.

The premises

2. The premises comprise a self-contained purpose built flat built circa 1919-1944. The premises have been modernised with full central heating and comprises three rooms, kitchen and bathroom/w.c.

Background

3. In a letter dated 11 June together with the accompanying form RR1 the landlord made an application for the re-registration of the fair rent for the subject premises as it was last registered in the capped sum of £155.00 per week with effect from 11 September 2017. For information purposes, the relevant rent register also referred to an uncapped rent for the subject premises of £275.00 per week to otherwise have been applicable at that date.

The Applicant’s evidence

4. In a letter dated 28 August 2019 sent to the Rent Officer and forwarded to the tribunal for the purposes of the tenant’s objection, Mr. [APPELLANT] stated he had lived at the premises since 1988 and since then no improvements had been carried out in any part of the flat. Mr. [APPELLANT] stated that the rent he had been paying for at least 15 years had been markedly more than other comparable registered rents at [NAME].

5. Mr. [APPELLANT] attended an oral hearing of his objection the new registered rent in which he told the tribunal he had looked at comparable flats in the building including Flat 48 a 4 roomed flat with a registered rent of £148 per week; Flat 46 a 4 roomed flat with a registered rent of £159.00 per week; Flat 55 a four roomed flat with a registered rent of £163 per week; Flat 58 a 4 roomed flat with a registered rent of £172 and Flat 83 a 5 roomed flat at £154.50 per week.

6. Mr. [APPELLANT] told the tribunal that all of these comparables should have full central heating and window replacements. Consequently, Mr. [APPELLANT] asserted that the rent for his flat should be registered at

3 £154.50 per week. Mr. [APPELLANT] stated that the tiling in the bathroom and the kitchen needed replacing/repairing as well as the floor tiles. Mr. [APPELLANT] stated he had replaced the kitchen unit, the bath, the w.c. and the sink. Mr. [APPELLANT] stated that he believed his flat should be completely re-wired for safety reasons and had been told that these works had been carried out although only a fuse box had been replaced. Mr. [APPELLANT] asserted that his w.c. had not been flushing properly for years and that the electric light in the hall was not working properly as the bulb ‘blows’ after a couple of weeks.

The Respondent’s evidence

7. No further representations or evidence was received from or on behalf of the landlord.

Inspection

8. The tribunal carried out an inspection of the premises on 8 November 2019 and found it to be a two bedroom flat in situated in low level purpose built block of flats and in a fair condition but with limited and dated electrical sockets/wiring and tired bathroom and kitchen tiling.

The tribunal’s decisions and reasons

9. In determining the fair rent to be registered the tribunal first considered the market rent that would otherwise be payable by the tenant but for the operation of The Rent Act 1977. The tribunal took as its starting point a market rent of £375 per week having regard to comparable properties in the N16 area indicating market rents of between £339 to £404 per week. The tribunal found the comparable rents upon which Mr. [APPELLANT] relied to be of limited assistance as little detail about these properties was provided. From the market rent of £375 per week, the tribunal made a number of deductions as required by section 70 of the Rent Act.

10. Therefore, the tribunal made the following deductions 10% for the dated kitchen; 5% for the dated bathroom/w.c; 5% to reflect the lack of landlord’s curtain, carpets and white goods, 5% to reflect the disrepair to electrics and w.c. and 5% to reflect the more onerous terms and conditions found in a Rent Act protected tenancy. This produced total deductions of 30%/£112.50 from the £375.oo per week providing an amount of £262.50. The tribunal then considered the issue of ‘scarcity’ of similar properties in the North London area and considered it was appropriate to make a deduction of 20% to reflect this factor. This provided an adjusted market rent of £210.00 per week.

11. . The tribunal was also required to carry out a calculation in accordance with the Rent Acts (Maximum Fair Rent) Oder 1999 which is intended to limit fair rent increases. Having carried out the calculation in accordance with the 1999 Order, this produced a rental figure of £173.50 per week. As this was a lower figure than the adjusted market

4 rental figure of £210.00 per week, the tribunal registered the fair rent to be payable as £173.50 per week with effect from 8 November 2019.

Signed: Judge Tagliavini

Dated: 8 December 2019