First-tier Tribunal Determines Market Rent for Property

OUTCOME: Allowed

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : CAM/00MC/MNR/2025/0662 HMCTS code : P:PAPERREMOTE

Property : [ADDRESS], [POSTCODE] Applicant (Tenant) : [APPELLANT] M [APPELLANT] Respondent (Landlord) : [APPELLANT] of application : Determination of a Market Rent: Sections 13 and 14 Housing Act 1988 Tribunal members : Mr [NAME] [NAME] of Determination : 2 August 2025

DECISION

This has been a remote determination on the papers which the parties are taken to have consented to, as explained below. The form of determination was a paper determination described above as P:PAPERREMOTE The documents that the Tribunal was referred to are in bundles from the Applicant and the Respondent. The Tribunal has noted the contents and the decision is below.

2

Decision The Tribunal determined a market rent of £1,050 pm effective from 1 May 2025.

Reasons Background 1. The Landlord served notice under section 13 (2) of the Housing Act 1988 on 23 March 2025 to increase the passing rent from £975 per month to £1,070 per month with effect from 1 May 2025.

2. The Tenant made an application dated 1 April 2025 to the Tribunal in reliance on section 13 (4) of the Housing Act 1988.

3. This rent in all cases is stated to be exclusive of Council Tax, Water Charges and fixed service charges.

4. The Tribunal issued directions on 7 April 2025, inviting the Parties to submit any further representations (including any photographs and details of rentals for similar properties) they wished the tribunal to consider.

Property 5. The Tribunal did not inspect the Property but has relied upon the Parties’ submissions and evidence in the public domain.

6. The Property comprises a first floor flat in a converted period mid- terraced building providing one living room, one bedroom, kitchen and bathroom furnished with a bed, sofa and appliances. Access is via the front door and staircase up from the ground floor lobby.

7. The [NAME] does not include any access to garden facilities.

8. The Landlord provided a floor plan detailing that the total floor space, excluding the communal ground floor lobby, extends to 420 ft2/39 m2.

9. There is no private car parking and on-street parking is subject to the obtaining of residents permits from the Council. [NAME]

10. The Property was previously subject to a lease dated 28 February 2024 for a period of 12 months from 1 April 2024 at an initial rent of £975 per month.

11. Clause 6.4.12 requires the Tenant:

3 “To keep the interior of the Property, the internal decorations and the Fixtures, Furniture and Effects in the same condition as they are in at the start of this Agreement…” 12. Clauses 6.8.4 requires the Landlord: “To maintain the general condition and repair of the property; i.e., general maintenance, wear and tear and damage caused by accidental fire, flood and structural damage.” 13. In addition, clause 6.9 confirms the Landlord’s statutory obligations as set out below.

14. Following expiry of this lease, a Statutory Periodic Lease arose. The Law 15. Section 5 (3) of the Act provides that the periodic [NAME] arising on expiry of the [NAME] is one: “(a) taking effect in possession immediately on the coming to an end of the fixed term [NAME]; (b) deemed to have been granted by the person who was the landlord under the fixed term [NAME] immediately before it came to an end to the person who was then the tenant under that [NAME]; (c) under which the premises which are let are the same dwelling- house as was let under the fixed term [NAME]; (d) under which the periods of the [NAME] are the same as those for which rent was last payable under the fixed term [NAME]; and (e) under which, subject to the following provisions of this Part of this Act, the other terms are the same as those of the fixed term [NAME] immediately before it came to an end, except that any term which makes provision for determination by the landlord or the tenant shall not have effect while the [NAME] remains an assured [NAME]” 16. Section 14 (1) of the 1988 Act provides that the Tribunal is required to determine the rent at which the Property might reasonably be expected to let in the open market by a [NAME] under an assured [NAME]: a. “having the same periods as those of the [NAME] to which the notice relates; b. which begins at the beginning of the new period specified in the notice; c. the terms of which (other than relating to the amount of rent) are the same as those of the existing [NAME].”

4 17. Section 14 (2) of the 1988 Act requires the Tribunal to disregard: a. “Any effect on the rent attributable to the granting of a [NAME] to a [NAME]; b. Any increase in the value of the dwelling-house attributable to a relevant improvement (as defined by section 14 (3) of the Act) otherwise than as an obligation; c. Any reduction in the value of the dwelling-house attributable to a failure by the tenant to comply with any terms of the [NAME].” 18. Section 11 of the Landlord and Tenant Act 1985 (the 1985 Act), provides that the Tribunal is to imply a covenant by the Landlord: a. “to keep in repair the structure and exterior of the dwelling- house (including drains, gutters and external pipes), b. to keep in repair and proper working order the installations in the dwelling-house for the supply of water, gas and electricity and for sanitation (including basins, sinks, baths and sanitary conveniences, but not other fixtures, fittings and appliances for making use of the supply of water, gas or electricity), and c. to keep in repair and proper working order the installations in the dwelling-house for space heating and heating water.” 19. Section 14 (7) of the 1988 Act states: “Where a notice under section 13(2) above has been referred to the appropriate tribunal, then, unless the landlord and the tenant otherwise agree, the rent determined by the appropriate tribunal (subject, in a case where subsection (5) above applies, to the addition of the appropriate amount in respect of rates) shall be the rent under the [NAME] with effect from the beginning of the new period specified in the notice or, if it appears to the appropriate tribunal that that would cause undue hardship to the tenant, with effect from such later date (not being later than the date the rent is determined) as the appropriate tribunal may direct.” Representations – The Tenant 20. The Tenant completed the Reply Form and stated: “This is another increase from the previous increment of 2024 of £970 per month from £900 per month which I think is an unfair rent.” Representations – The Landlord 21. The Landlord completed the Reply Form. No further evidence other than the Floor Plan, or comments were submitted.

5 Determination 22. The Tribunal is aware that the rent was previously determined (red: CAM/00MC/MNR/2024/0076) at £975 pcm with effect from 1 April 2024.

23. The Tribunal has had regard to all the correspondence and evidence provided by the Parties but is unable to refer to or make observations in respect of each point and document provided to it. The Tribunal would also stress that it has had the benefit of inspecting the Property.

24. In determining the market rent, the Tribunal has regard to prevailing levels of rent in the general locality and achieved rental values in respect of other properties of comparable accommodation and provision that would be likely to be considered by a prospective tenant. The current rent, and the period that has passed since that rent was agreed or determined is not relevant.

25. Previous changes in rent are not, therefore, relevant as the Tribunal is required to assess the rent that would be offered by a prospective tenant who has no knowledge of the existing or previous rents. Similarly, historic rents achieved elsewhere are of limited relevance.

26. The legislation requires the Tribunal to have regard to market demand assuming that the landlord is [NAME]. The Tribunal is therefore unable to have any regard to the personal circumstances or identities of the [NAME] landlord and tenant in assessing the level of rent.

27. It is therefore irrelevant whether or not the Landlord requires the rent to be at a certain level to fund its liabilities and/or its repair obligations under the lease or whether the Tenant feels that the services provided by the Landlord are “value for money.” As such, the cost of mortgage payments and property maintenance to the Landlord does not affect the rent that would be offered by a prospective tenant in the market and must be disregarded. Similarly, the ability, or otherwise, of the Tenant to pay the rent demanded cannot be taken into account.

28. In this regard, whilst the valuation exercise assumes that, regardless as to the condition of the Property, a [NAME] would be prepared to take occupation and negotiate a rent, it does not follow that the [NAME] and the [NAME] are one and the same. As such, the [NAME] may be prepared to pay a certain level of rent to remain in occupation for personal reasons whereas the [NAME] is bidding on the assumption that the Property is vacant and to let.

29. Neither of the Parties submitted any evidence in respect of rental values. Bearing these matters in mind, the Tribunal has reviewed all the evidence provided, relied upon its own expertise and knowledge of such matters and, having accounted for the state of the Property due to the Landlord’s evident inactivity, determines the market rental of the Property to be £1,050 per month. The rent payable may not,

6 therefore, exceed this figure. However, this does not prevent the Landlord from charging a lower figure. 30. This rent is to be effective from 1 May 2025.

Name: [NAME] [NAME]: 2 August 2025

Rights of appeal

By rule 36(2) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013, the tribunal is required to notify the parties about any right of appeal they may have. If a party wishes to appeal this decision to the Upper Tribunal (Lands Chamber), then a written application for permission must be made to the First-tier Tribunal at the regional office which has been dealing with the case. The application for permission to appeal must arrive at the regional office within 28 days after the tribunal sends written reasons for the decision to the person making the application. If the application is not made within the 28-day time limit, such application must include a request for an extension of time and the reason for not complying with the 28-day time limit; the tribunal will then look at such reason(s) and decide whether to allow the application for permission to appeal to proceed, despite not being within the time limit. The application for permission to appeal must identify the decision of the tribunal to which it relates (i.e., give the date, the property, and the case number), state the grounds of appeal and state the result the party making the application is seeking. If the tribunal refuses to grant permission to appeal, a further application for permission may be made to the Upper Tribunal (Lands Chamber).

7 First-tier Tribunal – Property Chamber File Ref No. CAM/00MC/MNR/2025/0662

Notice of the Tribunal Decision and Register of Rents under Assured Periodic Tenancies (Section 14 Determination)

Housing Act 1988 Section 14

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

[NAME] [NAME]

[APPELLANT] 39 Erleigh Rioad, Reading, [POSTCODE]

[NAME]

1. The rent is: £ 1,050 Per month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 1 May 2025

3. The amount included for services is

not applicable Per

4. Date assured [NAME] commenced 28 February 2024 5. Length of the term or rental period 12 6. Allocation of liability for repairs LL to comply with s11 LTA 1985 8. Furniture provided by landlord or superior landlord Sofa, bed and appliances 9. Description of premises First floor 1 bed flat in period terrace house conversion

8 Chairman P [NAME] of Decision 2 August 2025