Tribunal Sets Fair Rent Under Rent Act 1977

OUTCOME: Allowed

FR24 First-tier Tribunal – [NAME] Chamber File Ref No. JM/LON/00AY/F77/2023/0186

Notice of the Tribunal Decision

Rent Act 1977 Schedule 11

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

Judge P [NAME] [NAME]

Landlord [APPELLANT]

Tenant Mr [APPELLANT]

1. The fair rent is £825.50 Per month (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 16 November 2023

3. The amount for services is £166.31 Per month

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

£72.34 Per month

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

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 £1,020 per month.

Chairman P. [NAME] of decision 16 November 2023

FR24 MAXIMUM FAIR RENT CALCULATION

LATEST RPI FIGURE X 378.4

PREVIOUS RPI FIGURE Y 301.1

X 378.4 Minus Y 301.1 = (A) 77.3

(A) 77.3 Divided by Y 301.1 = (B) 0.2567253404

First application for re-registration since 1 February 1999 NO

If yes (B) plus 1.075 = (C)

If no (B) plus 1.05 = (C) 1.3067253404

Last registered rent* £631.50 Multiplied by (C) = 1.3067253404 *(exclusive of any variable service charge)

Rounded up to nearest 50p = £825.50

Variable service charge NO If YES add amount for services

MAXIMUM FAIR RENT = £825.50 Per month

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.

1

Case Reference

: LON/00AY/F77/2023/0186

[NAME] : [ADDRESS] [POSTCODE]

Tenant

: Mr [APPELLANT]

Landlord : [APPELLANT] of Objection : 19 May 2023

Type of Application : Section 70, Rent Act 1977

Tribunal

: Judge P [NAME] [NAME] of Summary Reasons

: 16 November 2023

_______________________________________________

DECISION

The sum of £825.50 per calendar month will be registered as the fair rent with effect from 16 November 2023, being the date on which the Tribunal made the Decision. ____________________________________

© CROWN COPYRIGHT 2023 FIRST - TIER TRIBUNAL [NAME] CHAMBER ([NAME])

2 SUMMARY REASONS

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 carried out an inspection of the [NAME] on 16 November 2023.

Evidence 3. The Tribunal has considered the brief written submissions provided by the Tenant and the more detailed oral submissions made by the Tenant at the hearing. There were no written submissions from the Landlord and the Landlord did not attend the hearing. Neither party provided its own comparable evidence.

Determination and Valuation 4. Having considered the comparable evidence sourced by us, which we put to the Tenant at the hearing to enable him to comment, and also with the benefit of our own general knowledge of rental values in the area as an expert Tribunal, our view is that the open market rent for the [NAME] would be in the region of £2,000 per calendar month if it was in good condition. From this level of rent we have made adjustments to reflect the actual condition of the [NAME] and other relevant factors.

To reflect the poor condition of the windows and doors (including the front door), the lack of a modern kitchen and bathroom, the electrics and the fact that there is only one radiator we have made a deduction of 25%.

To reflect the fact that the Landlord has not supplied white goods, carpets, curtains or furniture and the fact that the Tenant has internal decorating obligations we have deducted a further 15%.

5. The Tribunal has also made a 20% deduction for scarcity.

6. The full valuation is shown below:

per calendar month Market Rent

£2,000

Less Deduction of 25% to reflect poor condition

£500

____ NEW SUB-TOTAL

£1,500

Less

Further deduction of 15% to reflect lack of white goods etc

£225

3

____ NEW SUB-TOTAL

£1,275

Less Scarcity at approx. 20%

£255

____ TOTAL

£1,020

7. Therefore the uncapped fair rent initially determined by the Tribunal, for the purposes of section 70, was £1,020 per calendar month. However, the [NAME] qualifies for capping, and the capped rent for the [NAME] according to the provisions of the Rent Acts (Maximum Fair Rent) Order 1999 is calculated at £825.50 per calendar month. The calculation of the capped rent is shown on the decision form. In this case the lower rent of £825.50 per calendar month is to be registered as the fair rent for the [NAME].

Chairman: Judge P [NAME]: 16 November 2023

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 subsequent application for permission to appeal should be made on Form RP PTA