Lease Extension Premium Set at £32,300 - First-tier Tribunal Decision

OUTCOME: Allowed

Case Reference : LON/00AZ/OLR/2018/0194

Property : [ADDRESS] [POSTCODE]

Applicant: [redacted] : [COUNSEL] of [COMPANY], chartered Surveyors instructed by [RESPONDENT] solicitors

Respondent : [redacted] and [COUNSEL] : Missing Landlords

Type of Application : Application to determine the premium payable under section 50 of the Leasehold Reform Housing and Urban Development Act 1993

Tribunal Members : Tribunal Judge [NAME] and venue of : [ADDRESS], London Wc1E 7LR on 22nd Hearing

March 2018

Date of Decision : 22nd March 2018 (amended 26th March 2018)

_______________________________________________

DECISION ____________________________________

© CROWN COPYRIGHT 2018 FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

DECISION

The Tribunal determines that the premium payable for a lease extension in respect of the property the first floor flat at 37 [ADDRESS] [POSTCODE] (the Property) is £32,200 £32,300 as set out on the valuation prepared by Mr [NAME], Chartered Surveyor and appended to his report dated 1st March 2018.

We exercise our powers under Rule 50 to correct the clerical mistake, accidental slip or omission of our Decision dated 22nd March 2018 . Our amendments is made underlined. We have corrected our original Decision because the premium payable in the decision paragraph above is wrongly recorded.

BACKGROUND

1. On 19th October 2017 [APPELLANT], the leaseholder of the Property, made application to the County Court at Bromley seeking an extension to the term of her lease under section 50 of the Leasehold Reform Housing and Urban Development Act 1993 (the Act).

2. On 17th January 2018 at the County Court at Bromley Deputy District Judge Mohabir remitted the application to the Tribunal for the determination of the appropriate terms on which a new lease of the flat should be granted and the premium in respect of such lease extension.

3. We were provided with a bundle of papers for this matter to be considered at a paper determination at the Tribunal Offices in London on 23rd March 2018. The bundle included the valuation report from Mr [NAME] dated 1st March 2018 with various attachments, the draft deed of surrender and lease and the court papers with exhibits. [ADDRESS] order referred to above was also included.

4. No inspection of the Property was undertaken.

DETERMINATION

5. We have considered the provisions of section 50 of the Act.

6. In reaching our decision we have carefully considered the report of Mr [NAME]. It is very helpful. We are perfectly happy with his assessment of the capitalisation rate of 7% and the deferment rate of 5%. The valuation date of 19th October 2017, being the date the proceedings were commenced, is correct. His calculation of the capitalisation of the ground passing under the lease is correct.

7. We accept the evidence adduced as to the long lease values based on the comparables he cited. This gave a value of £370,750 as the starting point of

the valuation exercise. Such a figure was on the basis that no reduction was sought for any improvements undertaken by the Applicant.

8. On the question of relativity, he took the average of the graphs prepared for the RICS in 2009 which he set out at page 50 of the bundle. The resultant average figure is 87.5%, which we are comfortable with. This gave a short lease value of £324,406 and a marriage value figure of £28,080.

9. Taking these elements into account we are prepared to accept, for the purposes of this application, that the premium payable for the lease extension in respect of the Property should be £32,300.

10. We have reviewed the terms of the new lease which appear to be perfectly satisfactory. We would only comment that under recital D we consider the date of the Order should be 17th January 2018.

Judge: Andrew Dutton A A Dutton Date: 23rd March 2018

ANNEX – RIGHTS OF APPEAL

1. 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 at the Regional Office which has been dealing with the case.

2. 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.

3. If the application is not made within the 28-day time limit, such application must include a request to 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.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates (ie 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.