First-tier Tribunal Sets Fair Rent for Residential Property in Ilford

OUTCOME: Allowed

FR24 First-tier Tribunal – Property Chamber File Ref No. LON/00AB/F77/2021/0030

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were [ADDRESS], Ilford, Essex, 1G1 2RU

Mr [RESPONDENT] Mrs [APPELLANT]

Landlord [APPELLANT] [NAME]

Tenant Mr [APPELLANT] [NAME]

1. The fair rent is 212.50 Per Week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 15 March 2021

3. The amount for services is N/A Per

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

N/A 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

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 £240.00 per Week.

Chairman Mr [NAME] [NAME] of decision Tuesday 16th March 2021

FR24 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 294.6

PREVIOUS RPI FIGURE Y 274.7

X 294.6 Minus Y 274.7 = (A) 19.9

(A) 19.9 Divided by Y 274.7 = (B) 0.0724

First [NAME] for re-registration since 1 February 1999 - NO

If yes (B) plus 1.075 = (C)

If no (B) plus 1.05 = (C) 1.1224

Last registered rent* £198.00 Multiplied by (C) = £212.13 *(exclusive of any variable service charge)

Rounded up to nearest 50p = £212.50

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £212.50 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 [NAME] was the first since 1 February 1999) or 5% (if it is a second or subsequent [NAME] 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 [NAME] of the formula is ascertained the service charge is then added to that sum in order to produce the maximum fair rent.

© CROWN COPYRIGHT 2021

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : KA/LON/00AB/F77/2021/0030 Property : 191A [ADDRESS], [POSTCODE] Applicant (tenant) : [APPELLANT] [NAME] Respondent (landlord) : [APPELLANT] [NAME] of [NAME] : Determination of a fair rent under section 70 of the Rent Act 1977 Tribunal Members : Tribunal Judge S. J.[NAME] Tribunal Member S. Phillips MRICS Date of Decision : 15 March 2021 Date of reasons : 16 July 2021

REASONS

Background 1. On 1 July 2020 an [NAME] was received by the rent officer from the landlord for registration of a fair rent of £264.66 per week for the above property.

2. This was not the first registration in respect of the property. On 18 May 2017 a fair rent of £225 per week was registered by the rent officer. However, this was appealed to this Tribunal which, on 14 August 2017 set a fair rent of £189 per week. This was the rent being paid at the time of the [NAME].

3. On 29 September 2020 the rent officer registered a fair rent of £212.00 per week and noted that the uncapped rent would have been £240 per week. There was no provision for services in the rent.

2 4. Subsequently the tenant objected to the rent determined by the rent officer and the matter was referred to the Tribunal.

5. On 27 January 2021 the Tribunal issued directions setting the matter down for determination by written representations in the week commencing 15 March 2021. In the directions the parties were advised that if a hearing was required they could request one. No such request was made. The Tribunal concluded that it was appropriate to decide the [NAME] on the papers alone.

6. The directions also invited the parties to complete reply forms to provide more information about the property and to provide evidence about comparable rents, information about improvements and the condition of the property, and photographs. The parties were also advised that the Tribunal may use [ADDRESS] to gather more information.

7. The tenant’s objection to the rent fixed by the rent officer consisted of nothing more than an objection to the rent. No grounds were set out and no information was provided about the property. No further information was provided from the tenant after the directions were issued.

8. The landlord provided a completed reply form and a single page submission. The Tribunal also had information from the rent officer about comparable rents in the area of the property.

Findings 9. The Tribunal first considered what the market rent of the property would be. The property was described in the fair rent [NAME] as a self-contained flat over commercial premises built some time between 1800 and 1918. It was said to be modernised with full central heating and comprised two floors. On the first floor there were 2 reception rooms a kitchen and a bathroom and on the second floor there were 2 rooms. The landlord was responsible for repairs and external decorations, but the tenant was responsible for internal decorations subject to section 11 of the Landlord and tenant Act 1985.

10. In the reply form the landlord described the property as having 3 bedrooms and one reception room. The reception room was said to be 15ft. 2 in. x 9ft 9in. The kitchen was 7ft. 6in. x 13 ft. The bedrooms ranged in size from 10ft. 3in. x 15ft 3in. to 9ft. x 11ft. 2in. The property had central heating, double glazing and white goods provided by the landlord with carpets and curtains provided by the tenant. There was no garage or parking provision and no garden. The landlord stated that he was not aware of any defects or repairs and that a new extractor fan had recently been installed in the kitchen.

11. A [ADDRESS] search shows that the property consists of a two- storied terrace building built above a single-storey commercial property which extends in front of the property. There is a two-storey rear

3 extension. Access appears to be from the rear via an external staircase at the back of the extension to the first floor of the building. The construction is of brick with a stucco front and a tile roof and it probably dates from the beginning of the last century. There is a bay window on the first floor front and a dormer window above. The windows to the front have been double glazed. There is a dormer window to the rear on the upper floor. The construction shows that the upper rooms will have sloping ceilings. The external condition appears to be good.

12. The property is located on a busy commercial street which has many independent businesses selling food, groceries and clothing and also has numerous restaurants and take-aways. It is about half a mile from Ilford railway station.

13. In the absence of any evidence from the tenant and in the light of the landlord’s observations, the Tribunal was satisfied that the internal condition was good and that the property had the benefit of full central heating and white goods provided by the landlord.

14. In the landlord’s submissions it was argued that 2-bedroom properties in the region were marketed at £277 to £320 per week and that the asking price for 3-bedroom properties was between £300 and £334.61 per week, though no specific examples were given. No comparable evidence was provided by the tenant.

15. The rent officer’s calculation started at an open market rent of £357.69 per week Evidence of other local properties from the rent officer showed properties in terraced houses in the area achieving rents of between £316.15 per week and £415.38 per week. The rent officer had then applied a total of £95 per week in respect of adjustments to cover the tenant’s liability to repair, no white goods, no floor coverings and no parking. A further adjustment of 8%, or £22.69 per week, was made for scarcity. This resulted in an uncapped fair rent of £240 per week.

16. In the expert view of the Tribunal the size and location of the property made the starting point rather high, and it took the view that an open market rent without deductions would be more likely to be about £340 per week. On the other hand, the evidence was that white goods were provided by the landlord, so a smaller reduction was appropriate. In its view, taking the evidence together, the uncapped fair rent figure of £240 was about right.

17. In any event there was certainly no doubt in the Tribunal’s mind that the uncapped fair rent would be any lower than the amount of the rent with the cap applied.

18. The Tribunal then applied the capping provisions of the Rent Acts (Maximum Fair Rent) Order 1999 as set out in the calculation provided with its determination, using the last registered rent of £189 as determined by the previous Tribunal. Performing that calculation

4 produced a maximum fair rent of £212.50 per week. This is slightly higher than the figure set by the rent officer because of the passage of time since the rent officer reached their decision and the consequent change in the RPI figure.

19. As the maximum fair rent was lower than the uncapped fair rent figure determined by the Tribunal, the rent to be registered was £212.50 per week with effect from the date of the Tribunal’s decision.

20. It appears that the tenant first asked for reasons for the Tribunal’s decision in this case on 29 March 2021. However, regrettably it seems that that request was overlooked, for which the Tribunal apologises.

Name: Tribunal Judge [NAME]:

16 July 2021

ANNEX - RIGHTS OF APPEAL

• The Tribunal is required to set out rights of appeal against its decisions by virtue of the rule 36 (2)(c) of the Tribunal Procedure (First-tier Tribunal)(Property Chamber) Rules 2013 and these are set out below.

• If a party wishes to appeal against this decision to the Upper Tribunal (Lands Chamber) then a written [NAME] for permission must be made to the First-tier Tribunal at the Regional office which has been dealing with the case.

• The [NAME] for permission to appeal must arrive at the Regional office within 28 days after the Tribunal sends written reasons for the decision to the [NAME].

• If the [NAME] is not made within the 28-day time limit, such [NAME] 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 [NAME] for permission to appeal to proceed despite not being within the time limit.

• The [NAME] 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 [NAME] the [NAME] is seeking.