Tribunal Adjusts Rent Based on Property Condition

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. CHI/00MS/MNR/2023/0140

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 1 [ADDRESS], [POSTCODE]

[NAME] Mr [RESPONDENT] Mr [RESPONDENT] [RESPONDENT] [COMPANY], 142 [ADDRESS], [POSTCODE]

Tenant Mr [APPELLANT] & Mr [APPELLANT] [NAME]

1. The rent is: £ 1200.00 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 12 May 2023

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

4. Date assured tenancy commenced 12 October 2020

5. Length of the term or rental period 12 Months

6. Allocation of liability for repairs In accordance with agreement

7. Furniture provided by landlord or superior landlord None

8. Description of premises A two storey Victorian end of terrace house. The accommodation comprises: three bedrooms, living room, kitchen. Rear garden, central heating and double glazed windows.

[NAME] of Decision 7 July 2023

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case reference : CHI/00MS/MNR/2023/0140 Property : [ADDRESS], Southampton, Hampshire, SO14 ONG Applicant : [redacted] : None Respondent : [redacted] : None Type of [NAME] : Section 13(4) Housing Act 1988 Tribunal members : Mr [NAME] Mr [NAME] Mr [NAME] : Paper determination Date of decision : 7th July 2023

DECISION

2 Decision of the tribunal (1) The Tribunal determines that the rent that the property in its current condition as at the 12th May 2023 might reasonably be expected to achieve in the open market under an assured tenancy is £1,200 per month Background 1. The tenants have lived in the property as assured periodic tenants since 12th October 2020 with an agreement of that date.

2. On the 29th March 2023 the landlord served a notice pursuant to section 13(2) of the Housing Act 1988 seeking to increase the rent from £1,100 per month to £1,200 per month, being an increase of £100 effective from 12th May 2023.

3. By an [NAME] dated 23rd April 2023, the tenant referred that notice to the Tribunal for a determination of the market rent. The Tribunal issued Directions for the conduct of the matter on 30th May 2023.

4. The Tribunal considered the matter suitable for a determination on the papers and therefore a hearing was not necessary. The parties did not disagree with this arrangement. The Evidence 5. The Tribunal has before it, a bundle of evidence which includes a background to the case, the [NAME], the directions, the tenancy agreement, a completed rent appeal statement on behalf of the landlord and the tenant together with photographic evidence. The landlord submitted a list of comparable evidence which ranged between £1,200 per month and £1,300 per month. Inspection 6. The Tribunal did not inspect the property and relied on the information provided by the parties, Rightmove, [ADDRESS] and its expert knowledge. The property is an end of terrace Victorian house located in an established road in the St Mary’s area close to local amenities and Royal South Hants Hospital.

7. The accommodation comprises: 3 bedrooms, living room, kitchen, bathroom and rear garden. There is central heating and double-glazed windows. Roadside parking is provided by permit. The landlord confirms the property was refurbished in 2020 at the date of the commencement of the tenancy.

3 The Law 8.. The rules governing a determination are set out in section 14 of the Housing Act 1988. In particular, the Tribunal is to determine the rent at which the property might reasonably be expected to be let in the open market by a willing landlord under an assured tenancy, subject to disregards in relation to the nature of the tenancy (i.e. it being granted to a “sitting tenant”) and any increase or reduction in the value due to the tenant’s improvements or failure to comply with the terms of the tenancy. In the absence of any evidence to the contrary, the Tribunal has proceeded on the basis that the landlord is responsible for repairs to the structure, exterior and any installations pursuant to section 11 of the Landlord and Tenant Act 1985 and the tenant for interior decoration.

The valuation 9. Having carefully considered all the evidence the Tribunal considers that the rent that would be achieved in good condition with reasonably modern kitchen and bathroom fittings, modern services, carpets, curtains and white goods supplied by the landlord would be £1,300 per month. This figure is based upon the comparable evidence provided by the landlord and the Tribunal’s professional judgement and experience.

10. However the Tribunal now needs to adjust this figure to allow for the internal condition with evidence of mould to the bathroom, no white goods or curtains. The Tribunal has considered very carefully the tenant’s submissions and using its own expertise, concluded that a deduction of £100 should be applied. This reduces the rental figure to £1,200 per month. It should be noted that this figure cannot be a simple arithmetical calculation and is not based upon capital costs but is the tribunal’s estimate of the amount by which the rent would need to be reduced to attract a tenant. 11 The average rent for rental properties in the Southampton area has increased every quarter since the end of 2019, according to the online property portal Rightmove. The rent increases are due to not enough properties coming to the market to meet demand and the number of homes for rent is 46 per cent below 2019 levels. This puts this decision in context with the current rental market.

11. The Tribunal has been provided with a copy of the tenancy agreement, which incorporates the usual repair obligations.

12. The Tribunal received no evidence of hardship and, therefore, the rent determined by the tribunal is to take effect from 12th May 2023.

4

D [NAME] 7th July 2023

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 regional office which has been dealing with the 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. If the tribunal refuses to grant permission to appeal, a further [NAME] for permission may be made to the Upper Tribunal (Lands Chamber).