First-tier Tribunal Sets Lower Market Rent for Unmodernised Property

OUTCOME: Allowed

First-tier Tribunal – Property Chamber File Ref No. LON/00AC/MNR/2023/0351

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], London, [POSTCODE]

Judge Tueje Miss M [NAME] [RESPONDENT] T/A [RESPONDENT] 105 [ADDRESS], [POSTCODE]

Tenant Miss [APPELLANT]

1. The rent is: £ 875.00 Per month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 1st September 2023

*3. The amount included for services is/is

negligible/not applicable N/A Per

*4. Service charges are variable and are not included

5. Date assured tenancy commenced 2nd July 2009

6. Length of the term or rental period Periodic tenancy

7. Allocation of liability for repairs Section 11 of the Landlord and Tenant Act 1985

8. Furniture provided by landlord or superior landlord Unfurnished

9. Description of premises A ground floor one bedroom purpose built flat comprising open plan kitchen living room, bedroom and combined bathroom/WC.

Chairman Judge Tueje Date of Decision 6th December 2023

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : LON/00AN/MNR/2023/0351 Property : [ADDRESS], London, [POSTCODE] Tenant : Miss [COUNSEL] : In person Landlord : [RESPONDENT] T/A [RESPONDENT] : Mr [COUNSEL] [NAME], agent Type of [NAME] : Section 13 Housing Act 1988 Tribunal members : Judge Tueje Miss M Krisko FRICS Venue : 10 [ADDRESS] [POSTCODE] (Hybrid hearing) Date of hearing : 23rd November 2023 Date of decision : 6th December 2023

DECISION

The Tribunal’s determination Decision

The Tribunal determines that the market rent for the subject property is £875.00 per calendar month, with effect from 6th December 2023.

Background

1. By a notice dated 24th July 2023, the landlord sought an increase in rent under section 13 of the Housing Act 1988. The landlord proposed that the rent should increase from £801.67 to £950.00 per calendar month, with effect from 1st September 2023.

2. By an [NAME] dated 7th August 2023, the tenant, [APPELLANT], sought a determination of the rent payable under her tenancy.

3. The jurisdiction of the Tribunal is to set a market rent for the property taking into consideration the terms of the tenancy, the condition of the property, its location and the market rent for similar properties in the locality.

4. The tenant occupied the subject property under the terms of an agreement dated 2nd July 2009, renewed on a number of occasions, but which she now occupies as a statutory periodic tenant.

5. The hearing on 23rd November 2023 was conducted as a hybrid hearing, with [NAME] attending the Tribunal in person, and Mr [NAME] attending remotely.

The inspection

5. The Tribunal inspected the property on 23rd November 2023. We found it to be situated within a purpose-built block built in the latter half of the 20th century.

6. The flat itself is on the ground floor of the block and comprises a single bedroom, a small open plan kitchen/living room, and a combined bathroom/W.C.

7. From its internal inspection, the Tribunal noted the property is a small one bedroom flat, and that some repairs are required. The bathroom and kitchen are dated, the kitchen white goods and curtains belong to the tenant.

The law and the Tribunal’s valuation

9. Sections 13 and 14 of the Housing Act 1988 (“the 1988 Act”) make provision for the increase of rent under an assured periodic tenancy.

10. Under section 14 of the 1988 Act, the Tribunal must determine the rent that would be obtained in respect of the same property on a new letting on the open market by a [NAME] under an assured tenancy, on otherwise similar terms (other than rent) to the existing tenancy. The rent so determined must, however, disregard the effect on

the rent of the granting of the tenancy to a [NAME]; any increase in the value of the property as a result of improvements carried out by the tenant during the tenancy (or a previous tenancy), otherwise than as a result of his or her obligations to the landlord under the lease; or any reduction attributable to a failure to comply with such an obligation.

11. In coming to its decision, the Tribunal considered its observations during the inspection, plus the evidence presented to it at the hearing, and in writing.

12. The Tribunal first assessed the market price that would be achieved for a new letting, in a condition that would be expected of the property if it were to be marketed now. The Tribunal considered comparable properties, which show £1,250.00 to be the starting point.

13. Accordingly, the Tribunal finds that, if the property were in the condition to be expected of a current market letting, that the rent would be in the region of £1,250.00.

14. However, the property must be valued on the basis that a tenant would seek a reduction from that asking rent to reflect the unmodernised condition of the property. The reduction is not measured in monetary value, but reflects the percentage reduction that would be needed to let the property as it is today.

15. Based on the Tribunal’s knowledge and experience, we conclude a tenant would seek a reduction of at least the 30% of the market value to take account of all of the above matters.

Conclusion

16. The Tribunal therefore determines the market rent for the subject property, taking into consideration paragraphs 11 to 15 above, is £875.00 per calendar month.

17. Finally, the Tribunal considers it would cause undue hardship to the tenant for the increase to take effect on the date specified in the landlord’s notice. Therefore, pursuant to section 14(7) of the 1988 Act, the Tribunal determines the effective date of increase is 6th December 2023.

Name:

Judge Tueje

Date: 6th December 2023

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 [NAME] for permission must be made to the First-tier Tribunal at the [NAME] which has been dealing with the case. The [NAME] for permission to appeal must arrive at the [NAME] 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. If the tribunal refuses to grant permission to appeal, a further [NAME] for permission may be made to the Upper Tribunal (Lands Chamber).