Tenant Granted Fair Price for Lease Extension Based on Valuation Report

OUTCOME: Allowed

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : LON/00AY/OLR/2018/0522 Property : [ADDRESS] [POSTCODE] Applicant : [redacted] : [COUNSEL] [NAME] Respondent: [redacted] : A new extended lease Tribunal Members : Judge Prof [NAME] ([NAME])

Date and venue of determination : 5 June 2018 at 10 [ADDRESS] [POSTCODE] Date of Decision : 5th June 2018

DECISION

Introduction 1. This is an [NAME] made by the Applicants under section 50 of the Leasehold Reform, Housing and Urban Development Act (as amended) (“the Act”) for a determination of the terms and price for the granting of an extended new lease of the property known as [ADDRESS] [POSTCODE]. (”the property”).

2. By an Order made by Deputy District Judge Hood in the Croydon County Court dated 27 March 2018, the new extended leasehold interest in the property was vested in the Claimant and the matter transferred to the Tribunal to determine the price to be paid for that interest. The order was made upon the Court being satisfied that the location of the Respondent, as the freeholder, could not be ascertained despite reasonable attempts by the Claimants to do so. Therefore, the Respondent did not participate in these proceedings.

3. The property comprises a two bedroom second floor flat in an Edwardian semi-detached former house constructed on ground first and second (attic) floors. The lease being extended is dated 14 August 1987 and is for a term of 99 years from 1 January 1987 at a commencing rent of £100 that rises over the term to £400 per annum.

4 There has been submitted to the Tribunal a valuation report dated 24 January 2018 from Mr [NAME] of [NAME], the Surveyor for the Applicant.

The Tribunal’s decision 5 The Tribunal’s determination took place on 5 June 2018. There was no oral hearing and the Tribunal’s determination was based solely on the documentary evidence filed by the Applicant.

6 The valuation evidence relied upon by the Applicant was contained in the report prepared by Mr [APPELLANT] mentioned in paragraph 4 above. After considering the location and the local amenities he then considered the details of the property. With regard to the main parameters of the valuation Mr [NAME] considered yield (7%), deferment rate (5%), the long easehold flat value (£315,000), the freehold value (101% of the long leasehold flat value), (£318,182) and finally the current lease value (91.51% of the freehold value) (£291,168). Thus taking into account the diminution in value of the freeholders’ interest and marriage value the valuation is set by him at £18930. On careful consideration of the valuation prepared by Mr [APPELLANT] and submitted on behalf of the applicant, the Tribunal is satisfied that this is an appropriate and proper valuation for this property.

Conclusion 11. Accordingly, the Tribunal took careful consideration of all of the evidence and determined that the purchase price for the new extended leasehold interest is £18930.00. The valuation prepared by Mr [NAME] is therefore adopted by the Tribunal as its valuation. The Tribunal also approves the terms of the new lease as drafted.

The annex to this decision sets out rights of appeal available to the parties

Prof Robert M. Abbey Tribunal Judge 5 June 2018

Annex

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)