Tenant Wins Reduced Rent Due to Poor Property Condition

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. GB/LON/00BC/MNR/2024/0339

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 113A [ADDRESS], [POSTCODE]

Judge Prof R [NAME], MRICS

Landlord [RESPONDENT] 48 [ADDRESS], [POSTCODE]

Tenant [NAME] [APPELLANT]

1. The rent is: £ 184.61 Per week (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 10 June 2024

*3. The amount included for services is/is

negligible/not applicable

Per

*4. Service charges are variable and are not included

5. Date assured tenancy commenced 1997

6. Length of the term or rental period Weekly periodic

7. Allocation of liability for repairs Section 11

8. Furniture provided by landlord or superior landlord

9. Description of premises A first floor converted flat in an end of terrace house.

Chairman Judge Prof R Percival Date of Decision 20 November 2024

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : GB/LON/00BC/MNR/2024/0339 Property : 113A [ADDRESS], [POSTCODE] Tenants : [NAME] [RESPONDENT], represented by [NAME] [RESPONDENT], his nephew Landlord : [RESPONDENT], represented by [NAME] [NAME] [NAME] of objection : 10 May 2024 Type of [NAME] : Determination of a Market Rent sections 13 and 14 of the Housing Act 1988 Tribunal members : Judge Prof R [NAME], MRICS Venue and Date of hearing : 10 [ADDRESS] [POSTCODE]

Date of reasons : 21 November 2024

DECISION

The Tribunal determines a rent of £184.61 per week with effect from 10 June 2024

2 REASONS

Background 1. On 7 May 2024 the Landlord served a notice under Section 13(2) of the Housing Act 1988 which proposed a new rent stated as £1,500 per calendar month in place of the existing rent of “173.08 per week = per month £750” to take effect from 10 June 2024.

2. The Tenant referred the Landlord’s notice proposing a new rent to the Tribunal for determination of a market rent under Section 13(4)(a) of the Housing Act 1988. The Tenant’s referral was received by the Tribunal on 10 May 2024. The form of the rent 3. As will be apparent from the quotation set out in paragraph 1 above, it appears that the Landlord was effectively working from a calendar month figure for the rent, which was also expressed as a weekly rent. The tenancy agreement, which was provided by the Landlord, shows the rent as expressed weekly. It appears that the Landlord divided the 52 weeks in a year by 12 to get an “average” month of 4.3 recurring weeks to achieve the conversion. We should, accordingly, express our conclusion in terms of a weekly rent. However, in what follows, all parties considered the substantive issues in calendar month terms, that being how the rent was expressed in all of the comparable properties considered to arrive at a starting point marketable condition market rent. We have therefore followed that pattern, and converted a monthly rent into a weekly one using the same method at the end of the process. Evidence 4. The Tribunal received written material in advance from both parties, and heard their submissions at the hearing. The Landlord had presented six properties that [NAME] [RESPONDENT] considered comparable to this property. These, he suggested, averaged at about £1600 per calendar month. [NAME] [APPELLANT] argument on the Tenant’s behalf proceeded by effectively accepting a figure of a similar magnitude as a starting point, but then arguing that those comparables were in a far better condition than the property. He had specifically identified three of those presented by [NAME] [NAME] (from £1,595 to £1,700) to make his point. We note that these were marketed figures for rent, not the actual rent at which the flats were let.

5. For the Tribunal, Mrs [NAME] outlined the comparables that she had identified for the Tribunal. The most relevant were similarly sized properties, all of course in marketable condition, at between £1,400 and £1,650 (with outliers not so closely similar at £1,400 and £1,800), all properties let at those rents, not marketed at them.

3 6. In the event, therefore, there was a broad consensus drawn from the comparables available between the parties and the Tribunal that £1,600 was the correct starting point for properties in a marketable condition.

7. There was some dispute between the parties as to how close the property was to the location of the main local facilities.

8. There was considerable other evidence provided in relation to the history of the letting and the conduct of the parties, none of which we considered relevant to our task in determining a market rent. Inspection 9. The Tribunal inspected the property on 20 November 2024. The Tenant had occupied the property since 1997. It is a first floor converted flat in an end of terrace house.

10. The property was in a very poor overall condition. The decorative state throughout was very bad. Wallpaper was peeling, paint flaking off walls, (very dated) aertex ceilings were in places detached and defective. The carpets were very worn and in places almost threadbare. It seemed likely (although we had no direct evidence) that they had not been replaced for many years, possibly since the tenancy started. The kitchen fittings were old and stained, as were the tiles on the walls. The floor, under the lino was uneven and in places soft, which we considered likely to indicate rotten floor boards. The bathroom was also old, and stained, and in a particularly poor decorative state. The floor also exhibited unevenness below a lino floor covering, although it was not so pronounced as in the kitchen. The provision of curtains was limited. On his bedroom window, the Tenant had placed newspaper over the bottom half of the window for lack of curtains. There were insufficient socket outlets for modern needs in all of the rooms. The only white good was a (reasonable) refrigerator. There was no washing machine, tumble dryer or dishwasher. Determination and valuation 11. As noted above, we start from the market rent for the flat in a marketable condition being £1,600.

12. We do not think resolution of the dispute as to the walking distance to amenities assists our determination.

13. It would be artificial in the circumstances of this property to isolate out individual items which would reduce the rent appropriate for the property in its current condition and ascribe individual percentage reductions to them. We think it more appropriate to take an overall, global approach.

4 14. We conclude that the rent should be reduced by 50% to reflect its current condition, if it were to be marketed in its current state, as indicated in our account of the inspection, above.

15. That gives a figure of £800 on a per calendar month basis. Converting that into a weekly sum using the methodology used by the landlord gives a figure of £ 184.61 per week. Decisions 16. The Tribunal therefore determined that the rent at which the subject property might reasonably be expected to be let in the open market by a willing Landlord under an assured tenancy in its current condition was £184.61 per week.

17. The Tribunal directs the new rent of £184.61 per week to take effect on 10 June 2024, this being the date as set out in the Landlord’s Notice of Increase. Rights of appeal 18. 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 London regional office.

19. The [NAME] for permission to appeal must arrive at the office within 28 days after the Tribunal sends written reasons for the decision to the [NAME].

20. If the [NAME] is not made within the 28 day time limit, the [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 these reason(s) and decide whether to allow the [NAME] for permission to appeal to proceed despite not being within the time limit.

21. The [NAME] for permission to appeal must identify the decision of the Tribunal to which it relates, 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.

Name: Judge Professor R Percival Date: 21 November 2024