Market Rent Set for Assured Tenancy Under Housing Act 1988

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. CHI/45UH/MNR/2024/0166

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 21 [ADDRESS] [POSTCODE]

[NAME] [NAME] [NAME] Mr [RESPONDENT]

[RESPONDENT] c/o [ADDRESS], [POSTCODE]

Tenant [NAME]

1. The rent is: £ 1150 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 3 July 2024

3. The amount included for services is not applicable n/a Per n/a

4. Date assured tenancy commenced 3 September 2021

5. Length of the term or rental period Periodic

6. Allocation of liability for repairs Landlord

7. Furniture provided by landlord or superior landlord None

8. Description of premises Ground floor flat comprising living room/kitchen, two bedrooms, bathroom/WC. Parking.

[NAME] of Decision 23 August 2024

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case reference : CHI/45UH/MNR/2024/0166

Property : 21 [ADDRESS], [POSTCODE]

Applicant Tenant : Miss [COUNSEL] : None

Respondent Landlord : [RESPONDENT] : [RESPONDENT] of application : Determination of a Market Rent

Sections 13 & 14 Housing Act 1988

Tribunal members : [NAME] [NAME] [NAME]

Mr [NAME].[NAME].[NAME]. [NAME] of determination : 23 August 2024

Date of reasons : 26 September 2024

REASONS

© CROWN COPYRIGHT

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Decision of the Tribunal

On 23 August 2024 the Tribunal determined a Market Rent of £1,150.00 per month to take effect from 3 July 2024.

Background

1. By way of an application received by the Tribunal on 2 July 2024 the Applicant tenant of 21 [ADDRESS], [POSTCODE] (hereinafter referred to as “the property”) referred a Notice of Increase in Rent (“the Notice”) by the Respondent landlord of the property under Section 13 of the Housing Act 1988 (“the Act”) to the Tribunal.

2. The Notice, dated 11 May 2024, proposed a new rent of £1,290.00 per month in lieu of a passing rent of £1,000.00 per month, to take effect from 3 July 2024.

3. The tenant states that her tenancy commenced on the 3 September 2021. Neither the tenant’s application nor any subsequent submissions included a copy of the tenancy agreement.

4. Neither party challenged the jurisdiction of the Tribunal to determine this application. The Tribunal proceeds on the basis that determination is within our jurisdiction.

5. On 12 July 2023 the Tribunal issued Directions advising the parties that it considered the matter suitable for determination on the papers unless either party objected, in writing, within 7 days. The parties were also advised that no inspection would be undertaken. No objections were received.

6. The Directions required the landlord and tenant to submit their completed statements to the Tribunal by 26 July 2024 and 9 August 2024 respectively, with copies to be sent to the other party. The landlord did not submit a statement.

7. Having reviewed the submissions, the Tribunal concluded that the matter remained capable of being determined fairly, justly and efficiently on the papers, consistent with the overriding objective of the Tribunal.

8. These reasons address in summary form the key issues raised by the parties. They do not recite each point referred to in submissions but concentrate on those issues which, in the Tribunal’s view, are fundamental to the determination.

Law

9. In accordance with the terms of Section 14 of the Act, the Tribunal is required to determine the rent at which it considers the subject property might reasonably be expected to let on the open market, by a willing

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landlord, under an assured tenancy, on the same terms as the actual tenancy.

10. In so doing, and in accordance with the Act, the Tribunal ignores any increase in value attributable to tenants’ improvements and any decrease in value due to the tenants’ failure to comply with any terms of the tenancy.

The Property

11. In accordance with current Tribunal policy, the Tribunal did not inspect the property but did view external images on publicly available online platforms.

12. The property is a ground floor flat within a modern development, with accommodation comprising living room/kitchen, two bedrooms, bathroom/WC. The property has electric heating and was let with floor coverings, carpets and white goods. Off-street parking is included.

13. A development floor plan provided by the tenant lists the area of the property as 657 sq.ft.

14. The property is situated in an established residential area, convenient for local facilities and public transport.

Submissions – Tenants

15. The tenant’s submissions, excluding consideration of personal circumstances (which are to be disregarded in setting a market rent under the Act), can be summarised as follows.

16. The tenant describes the property as being in a good condition and well maintained. She explains that the fittings are believed to be no older than five years and are in a good condition. Some additional kitchen units, shelving rails and sink splash-back were fitted by the tenant. The tenant provided a number of helpful photographs showing the parking area, her kitchen improvements and the white goods.

17. The tenant suggests that an open market rent of £1,100 - £1,150 would be reasonable. Two hyper-links to properties advertised on the online letting portal Rightmove were provided. The Tribunal does not access hyperlinks and was therefore unable to view such.

Submissions – Landlord

18. None provided.

Determination

19. The Tribunal has carefully considered the submissions before it.

20. The Tribunal determines a market rent for a property by reference to rental values generally and, in particular, to the rental values for comparable properties in the locality. The Tribunal has no regard to the

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current 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 passing rent. In addition, the legislation makes it clear that the Tribunal is unable to account for the personal circumstances of either the landlord or the tenant.

21. The date at which the Tribunal assesses the rent is the effective date contained within the landlord’s Notice. The Tribunal disregards any improvements made by the tenant but has regard to the impact on rental value of disrepair which is not due to a failure of the tenant to comply with the terms of the tenancy.

22. In the first instance, the Tribunal determined what rent the landlord could reasonably be expected to obtain for the property in the open market, if it were let on the effective date and in the condition that is considered usual for such a market letting.

23. As stated above, the tenant provided hyperlinks to two advertised properties which she says support her assertion that the open market rent is between £1,100-£1,150. The landlord provided no comparable evidence.

24. The Tribunal considered whether it was necessary to invite the tenant to provide details of the evidence she relied upon within the unopened hyperlinks. However, using its own expert knowledge as a specialist Tribunal, the Tribunal found that it concurred with the tenant’s upper level of rent, in so much that the open market rent is £1,150 per month.

Accordingly, it was unnecessary to request further comparable information from the tenant. The Tribunal did not find that the tenant’s improvements added value to the open market rent.

25. Once the hypothetical rent was established it was necessary for the Tribunal to determine whether the property meets the standard of accommodation, repair and amenity of a typical modern letting. In this regard the Tribunal had no hesitation in finding it did meet such standards.

26. Accordingly, the Tribunal finds the open market rent to be £1,150 per month.

27. The tenant made no submissions to the Tribunal in regard to delaying the effective date of the revised rent on the ground of undue hardship under section 14(7) of the Act. Accordingly, the rent of £1,150.00 per month will take effect from 3 July 2024, that being the date stipulated within the landlord’s notice.

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RIGHTS OF APPEAL

1. A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application by email to [EMAIL] to the First-tier Tribunal at the [NAME] which has been dealing with the case.

2. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

3. If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.