First-tier Tribunal Determines Fair Rent Under Rent Act 1977

OUTCOME: Allowed

FR27 First-tier Tribunal – Property Chamber File Ref No. LON/00AH/F77/2025/0151

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were 70 [ADDRESS] [POSTCODE]

[NAME] [NAME]

Landlord [NAME]

Tenant Miss J [APPELLANT]

1. The fair rent is 587.50 Per month (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 15 July 2025

3. The amount for services is

Per

negligible/not applicable

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

Per

negligible/not applicable

5. The rent is/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)/ do not apply because 1st registration/15% exemption.

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 £ 628.82 ................. per month ........................ including £ ...................... per ................................. for services (variable).

(b) The fair rent to be registered is not limited by the Rent Acts (Maximum Fair Rent) Order 1999, because it is the same as/below the maximum fair rent of £ ................... per .................... including £ ......................................... per ................................. for services (variable) prescribed by the Order.

[NAME] of decision 15 July 2025

FR27 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 402.9

PREVIOUS RPI FIGURE Y 305.5

X 402.9 Minus Y 305.5 = (A) 97.4

(A) 97.4 Divided by Y 305.5 = (B) 0.31882

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) 1.36882

Last registered rent* 429.00 Multiplied by (C) = 587.22 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 587.50

Variable service charge YES / NO If YES add amount for services

MAXIMUM FAIR RENT = £587.50 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.

1

Case Reference

: LON/00AH/F77/2025/0151

Property : 70 [ADDRESS] [POSTCODE]

Tenant

: Miss [APPELLANT]

Landlord : [NAME] of Objection : 31 December 2024

Type of Application : Section 70, Rent Act 1977

Tribunal

: Mr [NAME] [NAME] of Summary Reasons

: 15 July 2025

_______________________________________________

DECISION

The sum of £587.50 per month will be registered as the fair rent with effect from 15 July 2025, being the date the Tribunal made the Decision. ____________________________________

© CROWN COPYRIGHT 2023

FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

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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.

Determination and Valuation

4. In the absence of rental comparables provided by the parties the tribunal has relied on its own expert, general knowledge of rental values in the area, we consider that the open market rent for the property in the condition and with the amenities the market would expect would be in the region of £1650.00 per month. From this level of rent we have made adjustments in relation to:

No carpets, curtains or white goods Tenants repairing liability

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

6. The full valuation is shown below:

This rent then needs to applied to the shared ownership formula set out in the lease.

Fair rent PCM Market rent 1,650.00 £ less condition & terms 30% 495.00 -£ adjusted rent 1,155.00 £ less scarcity off adj rent 20% 231.00 -£ Fair rent 924.00 £

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Decision

7. The uncapped fair rent initially determined by the Tribunal, for the purposes of section 70 and in accordance with the shared ownership lease was £628.82 per month. The capped rent for the property according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £587.50 per month. The calculation of the capped rent is shown on the decision form. In this case the lower rent of £587.50 per month is to be registered as the fair rent or this property.

Chairman: [NAME]: 15 July 2025

1. Determine Equivalent Fair Rent £924.00 2. Deduct service charge (less any audit , insurance and £0.00 management of the shared ownership lease, but NOT management of any services) Rolling Total 3. Adjust for full repairing lease £92.40 For houses: typically between 10% and 20% depending upon age and type. Rolling Total £831.60 4. Deduct for management, audit, insurance fees and, in flats, £20.48 any ground rent Management £5.00 Ground Rent Audit Figure Insurance Fees £15.48 Total for Box 4 Enter above £20.48 5. This produces the GROSS RENT £811.12 As defined in the shared ownership lease and annotated in the ‘Remarks’ box on the rent register % 25 6. Adjust for the tenant’s premium/equity share £202.78

7. This produces the SPECIFIED RENT £608.34 As defined in the shared ownership lease 8. Add back in the service charge, management, audit, £20.48 insurance fee and any ground rent 9. This produces the FAIR RENT £628.82 The amount to be registered, subject to rent capping

4 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