Tribunal sets fair rent for tenant after adjusting for property conditions and lease terms

OUTCOME: Allowed

1

Case Reference

: LON/00AW/F77/2024/0683

Property : [ADDRESS], [POSTCODE]

Tenant

: Mr [APPELLANT] [NAME]

Landlord : Peabody

Date of Objection : 29 October 2024

Type of Application : Section 70, Rent Act 1977

Tribunal

: Mr [NAME]

: 22 January 2025

_______________________________________________

DECISION

The sum of £241.50 per week will be registered as the fair rent with effect from 22 January 2025, being the date the Tribunal made the Decision. ____________________________________

© CROWN COPYRIGHT 2025

SUMMARY REASONS

FIRST - TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

2 Background

1. Following an objection from the Tenant to the determination of a fair rent by the Rent Officer, the Tribunal has made a determination under the provisions of the Rent Act 1977.

Inspection

2. The Tribunal did not inspect the property but considered this case on the basis of the papers provided by the parties.

Evidence

3. The Tribunal has consideration of the written submissions provided by the Tenant. There were no written submissions from the Landlord.

Determination and Valuation

4. Having consideration of the comparable evidence provided by the Tenant and our own expert, general knowledge of rental values in the area, we consider that the open market rent for the property in its current condition would be in the region of £500 per week. From this level of rent we have made adjustments in relation to:

Lease terms No white goods, furniture, floor coverings or curtains Unmodernised kitchen and bathroom Condition

5. The Tribunal has also made an adjustment for scarcity.

6. The full valuation is shown below:

per week Market Rent

£500.00

Less Lease terms

) Total No white goods, furniture, floor coverings or curtains ) approx. Date bathroom and kitchen

) 30% Condition

)

£150.00

£350.00

Less Scarcity

approx. 20%

£ 70.00

£280.00

7. The Tribunal determines a rent of £280.00 per week.

3

Decision

8. The uncapped fair rent initially determined by the Tribunal, for the purposes of section 70, was £280.00 per week. The capped rent for the property according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £241.50 per week. The calculation of the capped rent is shown on the decision form. In this case the lower rent of £241.50 per week is to be registered as the fair rent or this property.

Chairman: [NAME]: 22 February 2025

APPEAL PROVISIONS

These summary reasons are provided to give the parties an indication as to how the Tribunal made its decision. If either party wishes to appeal this decision, they should first make a request for full reasons and the details of how to appeal will be set out in the full reasons. Any request for full reasons should be made within a month. Any subsequent application for permission to appeal should be made on Form RP PTA

FR27 First-tier Tribunal – Property Chamber File Ref No. LON/00AW/F77/2024/0683

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

Address of Premises The Tribunal members were [ADDRESS], [POSTCODE]

[NAME]

Landlord [NAME] Mr [APPELLANT] [NAME]

1. The fair rent is £241.50 Per week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 22 January 2025

3. The amount for services is £27.77 Per week

4. The amount for fuel charges (excluding heating and lighting of common parts) not counting for rent allowance is

N/A Per N/A

not applicable

5. The rent is not to be registered as variable.

6. The capping provisions of the Rent Acts (Maximum Fair Rent) Order 1999 apply (please see calculation overleaf).

7. Details (other than rent) where different from Rent Register entry

N/A

8. For information only:

(a) The fair rent to be registered is the maximum fair rent as prescribed by the Rent Acts (Maximum Fair Rent) Order 1999. The rent that would otherwise have been registered was £280 Per week including £27.77 per week for services.

[NAME] of decision 22 January 2025

FR27 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 390.9

PREVIOUS RPI FIGURE Y 290.6

X 390.9 Minus Y 290.6 = (A) 100.3

(A) 100.3 Divided by Y 290.6 = (B) 0.345

First application for re-registration since 1 February 1999 NO

If yes (B) plus 1.075 = (C)

If no (B) plus 1.05 = (C) 1.395

Last registered rent* 173.00 Multiplied by (C) = 241.36 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 241.50

Variable service charge NO If YES add amount for services N/A

MAXIMUM FAIR RENT = £241.50 Per week

Explanatory Note

1. The calculation of the maximum fair rent, in accordance with the formula contained in the Order, is set out above.

2. In summary, the formula provides for the maximum fair rent to be calculated by:

(a) increasing the previous registered rent by the percentage change in the retail price index (the RPI) since the date of that earlier registration and

(b) adding a further 7.5% (if the present application was the first since 1 February 1999) or 5% (if it is a second or subsequent application since that date).

A 7.5% increase is represented, in the calculation set out above, by the addition of 1.075 to (B) and an increase of 5% is represented by the addition of 1.05 to (B).

The result is rounded up to the nearest 50 pence.

3. For the purposes of the calculation the latest RPI figure (x) is that published in the calendar month immediately before the month in which the Tribunal’s fair rent determination was made.

4. The process differs where the tenancy agreement contains a variable service charge and the rent is to be registered as variable under section 71(4) of the Rent Act 1977. In such a case the variable service charge is removed before applying the formula. When the amount determined by the application of the formula is ascertained the service charge is then added to that sum in order to produce the maximum fair rent.