First-tier Tribunal Sets Market Rent at £655 PCM for Two-Bedroom Property

OUTCOME: Allowed in Part

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : CAM/38UE/MNR/2023/0020 Property : 19 [ADDRESS], [POSTCODE] Applicant : [redacted] Respondents

: [redacted] : Section 14 of the Housing Act 1988 Determination of market rent payable.

Tribunal member(s)

:

[NAME] [NAME](Hons)

Date of decision : 22 May 2023

DECISION

Decision: 1. The Tribunal determined a rent of £655 per calendar month to take effect from 26 March 2023

Reasons Background 2. The Landlord by a notice in the prescribed form dated 17 January 2023 proposed a new rent of £700 per calendar month (pcm) to be effective from 26 March 2023. On 17 February 2023 the tenant referred the

2 Notice to the Tribunal. This was in lieu of the previous rent of £550 pcm.

3. Parties were requested to complete a pro forma supplying detail of the accommodation on a room by room basis, the features of the property (central heating, white goods, double glazing, carpets and curtains) and other property attributes and any further comments that they may wish the tribunal to take into consideration. This could include any repairs and improvements that had been made, any comments on the condition of the property and rentals of similar properties – should they wish to rely on these.

4. They were invited to include photographs and were informed that the Tribunal may use internet mapping applications to gather information about the location of the property and may inspect externally.

5. The determination would take place based on the submissions from both parties unless either party requested a hearing. Further evidence was submitted by both the landlord and the tenant. Parties did not request a hearing. The Property 6. The property is a two-bedroom Victorian mid terraced house of brick construction, rendered to the front elevation, with a tiled roof.

7. The accommodation comprises a lounge, kitchen, two bedrooms and bathroom.

8. The property has double glazing provided by the landlord but no central heating 9. There is a small garden to the rear The Tenancy 10. The tenancy commenced on 26 March 2018 and a copy of an assured shorthold tenancy agreement dated 23 March 2018 was provided. The tenancy term was for an initial period of 12 months at £550 pcm and a statutory tenancy on the terms of the written agreement appears to have arisen from 26 March 2019. Section 11 of the Landlord and Tenant Act 1985 applies in respect of Landlord’s repairing obligations. The Law

11. By virtue of section 14 (1) Housing Act 1988 the Tribunal is to determine a rent at which the dwelling-house concerned might reasonably be expected to be let in the open market by a willing landlord under an assured periodic tenancy- (a) having the same periods as those of the tenancy to which the notice relates;

3 (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 subject tenancy

12. By virtue of section 14 (2) Housing Act 1988 in [NAME] a determination the Tribunal shall disregard – (a) any effect on the rent attributable to the granting of a tenancy to a sitting tenant; (b) any increase in the value of the dwelling-house attributable to a relevant improvement (as defined by section 14(3) Housing Act 1988) carried out by a tenant otherwise than as an obligation; and (c) any reduction in the value of the dwelling-house due to the failure of the tenant to comply with any terms of the subject tenancy.

Representation – Tenant

13. In her written evidence the tenant said that the property had an EPC of F.

14. They submitted two pages of a report dated 23 January 2023 which appeared to be from the council which detailed a number of areas which needed attention – mainly around damp. These included: i) Accumulation of condensation to the bathroom walls due to the excess moisture not being adequately extracted by the ventilation ii) Exposed wires to bathroom light fitting iii) High moisture content to left wall of the living room consistent with an underlying damp problem iv) Rising damp to front wall due to lack of damp proof course v) Extraction hood to cooker not removing moisture causing condensation and splashback to cooker unsuitable

15. The tenant submitted a number of photographs which appeared to show damp and mould to a number of the walls.

16. The tenant also submitted a medical report in respect of her 2-year-old son which states that the child has asthma and that the father had reported that the main problem is damp in the house with black mould and fungus.

17. In terms of comparables the tenant provided two printouts of asking rents for 3-bedroom terraced housing in Kings Lynn PE30, both of which were on the market for £700pcm

4 Representations – Landlord

18. In their written representations the landlord confirmed the details of the accommodation and features of the property.

19. The carpets, curtains and white goods were provided by the landlord. 20. They said that the tenant had occupied the property for 5 years with no complaint and that the rent had not been increased during that time

21. The increase was recommended following a local and national property agency inspection of the property. A rent of £700pcm was at the lowest end when compared with similar two-bedroom properties in the same area. This took into account the improvements required. They felt that after complete renovations the rental value would be in excess of £825pcm.

22. The EPC was F – but they had a council exemption based on remedial work being carried out as a matter of urgency to raise the rating to a minimum of E

23. They did not believe that the images of damp and mould sent by the tenant were representative of the property. One of the images showed damp caused by a damaged downpipe which the tenant did not report. This was repaired on 9 January 2023 and the affected wall is no longer damp. The landlord had submitted photographs of the property which were representative of the property as of 28 February 2023.

24. The reference to rising damp in the council schedule referred to by the tenant had been since proven incorrect by an independent damp inspection on 2 March 2023. The council had agreed in writing that based on this independent report any damp in the property is not caused by rising damp. All other issues had been rectified with the exception of a replacement bathroom extractor and the installation of central heating.

25. They believed that any damp and mould at the property was caused by condensation due to the tenant’s lifestyle.

26. With regard to the medical report for the [NAME], the damp was reported by the father who did not reside at the property.

27. In terms of comparables they provided several pages of asking rents and brief details for properties in Kings Lynn. These included 3 two- bedroom properties at asking rents from £775-£825 and 4 three- bedroom properties at asking rents from £850 - £900. They provided asking rents for a number of flats and apartments.

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Determination

28. The Tribunal determines a market rent for a property by reference to rental values generally and to the rental values for comparable properties in the locality in particular. It does not take into account the present rent and the period of time which that rent has been charged nor does it take into account the percentage increase which the proposed rent represents to the existing rent. In addition, the legislation makes it clear that the Tribunal cannot take into account the personal circumstances of either the landlord or the tenant.

29. The Tribunal assesses a rent for the Property as it is on the day of the hearing disregarding any improvements made by the tenant but taking into account the impact on rental value of disrepair (if any) which is not due to a failure of the tenant to comply with the terms of the tenancy.

30. This is a two bedroomed property with a first-floor bathroom to the north of the centre of Kings Lynn. It has UPVC double glazing but no central heating and has an EPC rating of F which indicates that it will be expensive to heat. In the absence of that spend on heating it is likely to be prone to damp.

31. The tenant has provided a report from the local authority. The landlord submits that the local authority has rescinded the reference to rising damp but do not provide any written evidence of such correspondence nor do they provide the independent damp report

32. They submit that the damp to two adjoining walls in one room, as illustrated in pictures from the tenant, is due to failure of a downpipe – which the tribunal accepts is likely given the extensive nature of the staining.

33. They acknowledge that the property is in need or work and estimate that the need for such work reduces the rent that can be achieved for the property by some £125 per month.

34. The tribunal has had regard to the comparables provided by both the landlord and the tenant. It has disregarded the flats and apartments provided by the landlord as they are not helpful. It has attached more weight to the two-bedroom provided by the landlord and assesses the open market rent of the property in the condition that such a property would normally let on the market at £780 per calendar month. It agrees with the landlords that a deduction of £125 is appropriate to reflect how the market would regard the work that is required to the property and determines that the rent for the subject property is £655 per calendar month.

[NAME] [NAME](Hons) Regional Surveyor

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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 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. If the tribunal refuses to grant permission to appeal, a further [NAME] for permission may be made to the Upper Tribunal (Lands Chamber).

7 First-tier Tribunal – Property Chamber File Ref No. CAM/38UE/MNR/2023/0020

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 19 [ADDRESS], [POSTCODE]

[NAME] [NAME] (Hons)

Landlord [RESPONDENT] and [RESPONDENT] [NAME] 21 [ADDRESS] [POSTCODE]

Tenant [NAME]

1. The rent is: £ 655 Per month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 26 March 2023

*3. The amount included for services is not applicable

Per

*4. Service charges are variable and are not included

5. Date assured tenancy commenced 26 March 2018 6. Length of the term or rental period Month 7. Allocation of liability for repairs See full decision 8. Furniture provided by landlord or superior landlord See full decision 9. Description of premises See full decision

[NAME] of Decision 22 May 2023

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