First-tier Tribunal Sets Fair Rent Considering Property Conditions

OUTCOME: Allowed

FR24 First-tier Tribunal – Property Chamber File Ref No. LON/00AK/F77/2023/0390

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were 11 [ADDRESS], [POSTCODE]

[NAME] [APPELLANT]

Tenant [NAME]

1. The fair rent is 200.00 Per Week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 08 March 2024

3. The amount for services is Not applicable Per

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

Not applicable 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

None

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 the same as/below the maximum fair rent of £265 per week including £Nil per week for services (variable) prescribed by the Order.

[NAME] of decision 8 March 2024

FR24 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 378

PREVIOUS RPI FIGURE Y 296.9

X 378 Minus Y 296.9 = (A) 81.1

(A) 81.1 Divided by Y 296.9 = (B) 0.2731

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) 1.3231

Last registered rent* 200 Multiplied by (C) = 264.70 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 265

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £265 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.

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Case Reference

: TR/LON/00AK/F77/2023/0390

Property : 11 [ADDRESS], [POSTCODE]

Tenant

: [NAME]

Landlord : [APPELLANT] of Objection : 25 October 2023

Type of Application : Rent Act 1977

Tribunal

: [NAME] Valuer 079475 [NAME] of Summary Reasons

: 11 March 2024

_______________________________________________

DECISION

The sum of £200 per week will be registered as the fair rent with effect from 8 March 2024, 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 inspected the property in conjunction with Mrs [NAME] and her son in law on 8th March 2024. The inspection revealed extensive dampness to the internal wall surfaces of bedroom 1, lounge and kitchen. The severity of this defect is deemed a material rental consideration by the Tribunal.

Evidence 3. There were written submissions on condition, landlord improvements and comparable market rents from the landlord. The tenant made a written submission on the extent of internal dampness at the property.

Determination and Valuation 4. Having consideration of the submissions on comparable market rent made by the landlord and our own expert, general knowledge of rental values in the area we consider that the open market rent for the property in a satisfactory condition would be in the region of £369 per week equivalent to £1600 per month. From this level of rent we have made adjustments to reflect any tenant improvements, disrepair and obsolescence at the property. Details of the adjustments made are shown in the valuation table below.

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

6. The full rental valuation is shown below:

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7. The sum of £199.26 per week calculated and shown in table 1 is rounded up to £200 per week. The Tribunal accordingly determines a rent of £200 per week.

Decision 8. The uncapped fair rent initially determined by the Tribunal, for the purposes of section 70, was £200 per week. The capped rent for the property according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £265 per week. The calculation of the capped rent is shown on the decision form. In this case the lower rent of £200 per week is to be registered as the fair rent for this property.

Chairman: [NAME]: 11 March 2024

APPEAL PROVISIONS

You can only appeal this determination if the First-tier Tribunal decision was wrong on one or more points of law and you must say why the First-tier Tribunal was wrong in law. 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