Tribunal Adjusts Market Rent Based on Property Condition

OUTCOME: Allowed

First-tier Tribunal – Property Chamber File Ref No. TR/LON/00AE/MNR/2025/0676

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 79 CENTRAL ROAD SUDBURY TOWN LONDON [POSTCODE]

[NAME] MR O [RESPONDENT] DR V [RESPONDENT] & [NAME] [RESPONDENT]

[APPELLANT] [NAME]

1. The rent is: £ 2,200.00 Per month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 24TH October 2025

*3. The amount included for services is/is

negligible/not applicable N/A Per

*4. Service charges are variable and are not included

Chairman [NAME] of Decision 24th October 2025

5. Date assured tenancy commenced 10th October 2024

6. Length of the term or rental period Monthly

7. Allocation of liability for repairs LL repairs

8. Furniture provided by [RESPONDENT] or superior [RESPONDENT]

9. Description of premises A terraced house comprising ; 3 bedrooms , 2 reception rooms , kitchen bathroom. Garden

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case Reference : TR/LON/00AE/MNR/2025/0676

Hearing Type : [ADDRESS] of Written Representations

Property : 79 [ADDRESS], [POSTCODE]

Applicant: [redacted]

Respondent: [redacted] : Referral in Respect of Market Rent Under Section 13 of the Housing Act 1988

Tribunal Members : J.A. [NAME]

Mr O Miller

Tribunal Member

Date of Hearing : No hearing took place.

Date of Inspection : A limited inspection was completed on 24th October 2025.

Date of Full Reasons : 3rd November 2025

STATEMENT OF FULL REASONS ON AN [NAME] FOR DETERMINATION OF A MARKET RENT UNDER S. 13 AND 14 OF THE HOUSING ACT 1988.

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REASONS

Background

1. On 4th September 2025, the [RESPONDENT] served a Notice under Section 13(2) of the Housing Act 1988 proposing an increase in the rent of the above property from the passing rent of £1,400 per month to £2,200 per month.

2. On 10th October 2024, the [APPELLANT] made an [NAME] to the Tribunal for the determination of a market rent.

3. The original tenancy was believed to have begun 25th July 2019.

4. By way of a letter dated 4th April 2025 the Tribunal issued directions, amended 4th July 2025. These required the [RESPONDENT] to provide details of evidence on which they wished to rely by way of reply by 29th July 2025. The [APPELLANT] was directed to do the same by 12th August 2025 and the [RESPONDENT] was given until 19th August 2025 for his response thereto.

5. On 7th October 2025 the Tribunal wrote to the parties confirming details for an inspection to take place on 24th October 2025.

6. Both parties took the opportunity to make submissions.

7. In consideration of the market rental value of the subject property, the Tribunal has taken into consideration all documentation before it, including various letters and the reply forms returned by the parties.

8. Within their [NAME] dated 10th October 2024, the [APPELLANT] states that they have replaced all the furniture originally supplied by the [RESPONDENT]. They also advised that they have changed carpeting.

9. They advised that the property suffered from damp and that they have completed repainting in a number of areas, and have had to repair a water leak in the bathroom.

10. In correspondence to the Tribunal the [APPELLANT] advises that they applied to have the property converted into an HMO but that the [RESPONDENT] objected to this.

11. In the Tenants Reply form the [APPELLANT] confirmed that they wish to have a property inspection but do not wish to have a hearing. They said that the property is not in good condition, and it was not in good condition when the tenancy

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began. They confirm they have decorated the house and once again refer to the replacement of carpets. They mention that two window locks were broken and they provide details of the accommodation and room measurements. The [APPELLANT] confirms that the property does have central heating and double glazing.

12. The solicitors acting on behalf of the [RESPONDENT] confirm in correspondence that they believe the rent to be £2,200 per calendar month and provide a range of comparables of similar properties between £2,200 and £2,700 per month.

13. They provide details of a comparables report from Checkmate, dated 24th April 2025 and screenshots from Zoopla, confirming that the comparable properties to which they refer were available on the market between January 2025 and April 2025, with three bedroom houses ranging in price from £2,495 to £2,800 per month.

14. In the [RESPONDENT]’s Reply form they give a separate response, dated 16th May 2025, in which they say that the property was in good condition at commencement of the tenancy.

15. They confirm that consent was not given to run the property as an HMO, and confirm that they have only recently acquired the property and that Mr [NAME] has occupied under the ownership of two separate Landlords.

16. The Landlords say that the [APPELLANT] has refused access to undertake an inspection, and in reference to the [APPELLANT]’s submissions state that, in their opinion, the repairs highlighted are relatively minor.

17. On 24th October 2025 on the basis of written submissions and without a hearing but with the benefit of a limited inspection (external only), the Tribunal determined the Market rent of the above property at £2,200 per month.

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Hearing

18. No hearing took place.

Hardship

19. On the issue of hardship, the [APPELLANT] has advised that they will struggle to pay the increased rent. In an email dated 19th August, the [APPELLANT] refers to the stress and financial strain they have suffered as a result of this Section 13 [NAME], served with a notice stating that the [RESPONDENT] required possession of the property .

20. The [APPELLANT] states that he currently has two jobs. One is a training position, providing very little income and as a result, he has had to take a second job as a private hire driver.

21. Providing further details of his financial position, he states that he still has a student loan of £15,314 and an additional loan of £31,476.77, with total credit card bills of a further £7,322.22.

22. Recent outgoings in relation to this case have included County Court payments of £2,100 and £1,400, totalling £3,500. He states that the cases taken against him have affected his credit score.

23. The [RESPONDENT] makes commentary on the issue of hardship, but only to say that the [APPELLANT]’s ability to afford to pay the rent should not be reflected in our assessment of the open market rental value.

Inspection

24. The Tribunal had initially written to the parties and an inspection had been arranged for 24th October 2025. On the day before the inspection, correspondence was received from the [RESPONDENT], stating that they would no longer be at the property to provide access.

25. On the morning of the hearing, following deliberation and a submission from the [APPELLANT] that they wish the inspection to continue, the Tribunal decided that it would attend the property to undertake an inspection thereof as far as was possible.

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26. In the event, the Tribunal met at the property. The [RESPONDENT] was not present, nor was there a representative thereof.

27. The [APPELLANT] did attend and the Tribunal advised that they would not be in a position to take any further submissions from them during the course of the inspection.

28. The Tribunal was able to inspect the front of the property and the rear, including the rear garden and rear elevations, but no access to the property or the garden areas was possible.

29. From the lounge window the Tribunal could tell that the property had been subject to at least some refurbished, presumably to re-let.

30. From the external inspection, the Tribunal could confirm that the property was a mid-terraced 1930s dwelling house, understood to be three bedrooms, kitchen, and bathroom/WC.

31. There is a small kitchen extension at ground level to the rear and a detached building at the far end of the garden.

The Law

32. When determining a market rent in accordance with the Housing Act 1988 Section 13 regard must be had to all of the circumstances (other than personal circumstances) including the age, location and state of repair of the property, matters contained within the rent, repairing obligations, etc. This means that issues such as the [APPELLANT]’s ability to pay the rent or bills associated with the property are not a consideration for the tribunal in assessing the rent.

Decision

33. Many of the submissions put before the Tribunal and much of the evidence related to issues over which the Tribunal does not have jurisdiction, and in particular, the Tribunal refers to submissions relating to use and the licencing of the property as an HMO.

34. Assessing the property at the date of valuation the Tribunal is satisfied from the evidence that the property had suffered from slight wear and tear unfortunately this could not be confirmed from the inspection. The Tribunal were, however, able to ascertain the type of house and the accommodation as detailed above.

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Valuation

35. Following consideration of the written and photographic submissions given by both parties, taking into account the Tribunal’s limited inspection and using its own knowledge and experience of the rental market in Sudbury Town, the Tribunal finds that the market rental value of the property, if it was in good condition, would be £2,300 per month.

36. Taking into account the lack of modernisation and the general disrepair, the Tribunal considers it necessary to adjust that market rental value to reflect specifically the following:

i) General wear and tear

37. Taking these and other more general factors into consideration, the Tribunal finds that it is necessary to make a £100 per month deduction in the market rental value of the property to reflect its condition and lack of modernisation.

Valuation Calculation

38. Open market rent £2,300 per month

Deduction for adjustments detailed above £ 100

Adjusted rent £2,200 per month

The Tribunal therefore determines that the market rental value of the property should be set at a figure of £2,200 per month.

Hardship

39. Within their written submissions the [APPELLANT] has made statements of financial hardship , detailed the necessity for them to have two jobs and highlighted that they have limited income. They have also provided evidence of loans and debt, and this has not been challenged by the Landlords.

40. While not within the Tribunal’s jurisdiction, correspondence relating to the [APPELLANT]’s attempt to have the property registered as an HMO and sublet it also suggests a requirement for additional income.

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41. The [APPELLANT] also mentions the affordability requirements applied by [NAME], and states that at the rent proposed by the [RESPONDENT] the [NAME] would require any applicants to have an income between £66,000 and £79,000 per annum, a figure far exceeding the income that they currently have.

42. Finally, the fact that the Landlords’ notice would result in an increase in rent from October 2024 and back rent payable thereto, it also opens the possibility that the total sum payable might be considerable.

43. In these circumstances, the Tribunal is of the opinion that to determine that the rent determined by the Tribunal should be payable from the [RESPONDENT]’s notice date would cause the [APPELLANT] hardship and in these circumstances, determines that the rent should be payable from the date of the Tribunal decision.

Chairman:

[NAME]

Date: 3rd November 2025

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ANNEX OF RIGHTS FOR MARKET RENTS

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 might 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 regional office which has been dealing with this case

The [NAME] for permission to appeal must arrive at the regional office 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. Any appeal in respect of the Housing Act 1988 should be on a point of law.

If the Tribunal refuses to grant permission to appeal, a further [NAME] for permission may be made to the Upper Tribunal (Lands Chamber).