Rent Adjustment Based on Property Condition and Previous Improvements

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. LON/00AH/MNR/2019/0091

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 30 [ADDRESS], [POSTCODE]

[NAME] Mr [RESPONDENT]

Landlord [RESPONDENT] 3rd [ADDRESS], [POSTCODE]

Tenant Mr [APPELLANT]

1. The rent is: £ 1040.00 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 01 September 2019

*3. The amount included for services is/is

negligible/not applicable nil Per

*4. Service charges are variable and are not included

5. Date assured tenancy commenced 1 April 2019

6. Length of the term or rental period Calendar monthly

7. Allocation of liability for repairs Per lease

8. Furniture provided by landlord or superior landlord None

9. Description of premises Mid-terraced house. Ground floor 2 rooms. Kitchen, wc in rear extension. First floor 3 rooms, bath/wc

[NAME] of Decision 25/10/2019

© CROWN COPYRIGHT 2013

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : FL/LON/00AH/MNR/2019/0091 Property : 30 [ADDRESS] [POSTCODE] Applicant : [redacted] Representative : None Respondent : [redacted] (Landlord) Representative : None Type of Application : Section 13(4) Housing Act 1988 Tribunal Members : Mr. [NAME]. [NAME] Mr. [NAME]. [NAME] and venue of Hearing : 25 [ADDRESS] [POSTCODE] Date of Decision : 25 October 2019

REASONS FOR DECISION

Background

1 The First Tier Tribunal received an application on 29 July 2019 from the tenant of the Property regarding a notice of increase of rent, served by the landlord, under S.13 of the Housing Act 1988 (the Act).

2 The notice, dated 2 July 2019, proposed a new rent of £1350 per calendar month (pcm), with effect from and including 1 September 2019. The rent payable up to and including 31 August 2019 was £765 pcm.

2 3 The tenancy is an assured periodic monthly. No copy was provided.

4 The Tribunal issued directions on 29 August 2019; set 25 October 2019 as the date for determination and required parties to forward evidence to the Tribunal by 23 September 2019 from the landlord and by 4 October 2019 from the tenant.

Inspection

5 The Tribunal inspected the property on 25 October 2019. The tenant attended, the landlord did not.

6 The Property is a late Victorian mid terraced house in a quiet residential road in South Norwood. The Property is constructed of brick walls, and single lap concrete tiled double pitched main roof. Accommodation comprised first floor 2 bedrooms, boxroom and bathroom/ wc (wet room); ground floor 2 receptions, kitchen with a rear lean to. The house has full plastic framed double glazing and full gas fired central heating.

7 The Property has a small front and back garden. There are no on-street parking restrictions, but little off-street provision either. There are no landlords white goods, carpets and curtains. The kitchen and bathroom are functional but, by now, basic.

Evidence

8 The landlord acknowledged and provided details of the works carried out by the tenant over many years, but during the preceding regulated tenancy and not under the subsequent current assured tenancy. The tenant’s improvements included; gas fired central heating, bathroom/ wet room, and double glazing,

9 The landlord provided brief details of 4 houses which had been let: A 3 bedroom terraced house in [ADDRESS], half a mile distant let for £1550 pcm; another very nearby semi detached 3 bedroom house, un- let but available at £1500 pcm in [ADDRESS]; a 3 bedoom terraced house in [ADDRESS] half a mile away let at £1495 pcm; and lastly a another 3 bedroom house similarly located also let at £1495 pcm. The landlord concluded that a market rent of £1500 and after adjustments for condition £1350 pcm should apply here.

10 The tenant submitted a letter received with the application. It also listed the works carried out by the former tenant under the regulated tenancy over many years, either at their expense of by means of a grant. The two parties were essentially in agreement as to the number and extent of these improvements. These also included a lean to at the rear of the house, now dilapidated but, still present.

11 Neither party requested a hearing and the Tribunal determined the new rent based on the written submissions and from the inspection.

3

Law

12 In accordance with the terms of S14 of the Act the Tribunal is required to determine the rent at which it considers the property might reasonably be expected to let in the open market, by a willing landlord, under an assured tenancy, on the same terms as the actual tenancy. It ignores any increase in value attributable to tenant’s improvements and any decrease in value due to the tenant’s failure to comply with any terms of the tenancy. Thus the property falls to be valued as it stands; but assuming that the property to be in a reasonable internal decorative condition. However where improvements were carried out under a former regulated tenancy, their presence and the value of these, if any, at the valuation date, is no longer excluded under a succession tenancy but, are reflected in the rent.

Decision

13 Based on the Tribunal’s own general knowledge of market rent levels in South Norwood, we determine that the subject property would let on normal Assured Shorthold Tenancy (AST) terms, for £1,300 pcm, fully fitted and in good order.

14 However, with the absence of white goods, carpets and curtains and the now basic condition of the kitchen and bathroom, and the dilapidated lean/to, the Tribunal deducts £260 pcm leaving £1040 pcm as the new rent effective from the date of the increase in the landlords notice as 1 September 2019.

[NAME] 25 October 2019