Tribunal Sets Higher Market Rent for Property

OUTCOME: Allowed

MR22 First-tier Tribunal – Property Chamber File Ref No. CHI/43UH/MNR/2023/0054

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 65 [ADDRESS], [POSTCODE]

[NAME] [NAME] Mr [RESPONDENT] [NAME]

Landlord [RESPONDENT] c/o [ADDRESS], [POSTCODE]

Tenant Mr [APPELLANT]

1. The rent is: £ 1540.00 Per Calendar Month (excluding water rates and council tax but including any amounts in paras 3)

2. The date the decision takes effect is: 17 April 2023

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

4. Date assured tenancy commenced 05 May 2003

5. Length of the term or rental period Monthly periodic

6. Allocation of liability for repairs Landlord

7. Furniture provided by landlord or superior landlord None

8. Description of premises Semi-detached house with accommodation comprising entrance hall, kitchen, scullery, two reception rooms, four bedrooms, bathroom, WC. Off-road parking for one vehicle. Garden. Dated and in need of modernisation.

[NAME] of Decision 18 May 2023

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FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case reference : CHI/43UH/MNR/2023/0054

Property : 65 [ADDRESS],

[POSTCODE]

Applicant Tenant : Mr [COUNSEL] :

Respondent Landlord : [RESPONDENT] : [COMPANY] of application : Determination of a Market Rent

Sections 13 & 14 Housing Act 1988

Tribunal member(s) : [NAME]

[NAME]

Mr [NAME] of decision : 18 May 2023

REASONS

© CROWN COPYRIGHT

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Decision of the Tribunal

On 18 May 2023 the Tribunal determined a Market Rent of £1,540.00 per month to take effect from 17 April 2023.

Background

1. By way of an application received by the Tribunal on 15 March 2023, the Applicant tenant of 65 [ADDRESS], [POSTCODE] (“the property”), referred a Notice of Increase in Rent (“the Notice”) by the Respondent landlord of the property under Section 13 of the Housing Act 1988 (“the Act”) to the Tribunal.

2. The Notice, dated 6 March 2023, proposed a new rent of £1,300.00 per month in lieu of the passing rent of £1,260.00 per month, to take effect from 17 April 2023.

3. The tenant occupies the property under a periodic assured tenancy by way of a succession to a Rent Act tenancy dated 1964. The succession took effect after the death of the tenant’s mother in 2003.

4. On 13 April 2023 the Tribunal issued Directions advising the parties that it considered the matter suitable for determination on papers unless either party objected, in writing, within 7 days. The parties were also advised that no inspection would be undertaken. No objections were received.

5. The Directions required the landlord and tenant to submit their completed statements to the Tribunal by 27 April 2023 and 11 May 2023 respectively, with copies to be sent to the other party. Neither party made any submissions. Accordingly, the Tribunal determined the rent having regard to information contained within the Applicant’s application form.

6. In February 2022 the Applicant applied to the Tribunal for determination of the market rent under the Act. The Tribunal handed down its decision in that matter on 9 May 2022 (CHI/43UH/MNR/2022/0016). This Tribunal referred to the previous decision only where relevant to these proceedings.

7. Having reviewed the application, the Tribunal concluded that the matter was capable of being determined fairly, justly and efficiently on the papers, consistent with the overriding objective of the Tribunal.

8. These reasons address in summary form the key issues raised by the parties. They do not recite each and every point referred to in submissions. The Tribunal concentrates on those issues which, in its view, go to the heart of the application.

Law 9. In accordance with the terms of Section 14 of the Act, the Tribunal is required to determine the rent at which it considers the subject property might reasonably be expected to let on the open market, by a willing landlord, under an assured tenancy, on the same terms as the actual

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tenancy.

10. In so doing, and in accordance with the Act, the Tribunal ignores any increase in value attributable to tenants’ improvements and any decrease in value due to the tenants’ failure to comply with any terms of the tenancy.

The Property

11. In accord with current Tribunal policy, the Tribunal did not inspect the property but did view it from publicly available online platforms.

12. The property is a bay-fronted two-storey semi-detached house built of brick and part rendered elevations beneath a pitched roof covered in tiles. The property is located in an area of residential and commercial properties within easy access of public transport and close to the River Thames.

13. The accommodation comprises an entrance hall; kitchen; scullery and two reception rooms to the ground floor and four bedrooms and a bathroom, WC to the first floor. The tenant describes two of the bedrooms as “large” and two as “small”.

14. To the front of the property is an enclosed garden and off-road parking for one vehicle. There appears to be a further garden to the rear.

15. The Tribunal’s previous decision recorded that there is no central heating and only one gas fire. Also, that white goods, carpets and curtains are provided by the tenant. In the absence of submissions from either party and having regard to the significant period of occupation, the Tribunal determine the rent valuation on such basis.

16. Having consulted the National Energy Performance Register online, the Tribunal noted the property to have an Energy Performance Certificate (EPC) Rating of E and a recorded floor area of 129m2. The EPC refers to full double gazing, which the Tribunal also noted from viewing the front of the property via online portals.

Submissions – Tenant (summarised)

17. In the applicant form the tenant stated that tenant’s improvements include installation of a shower, bathroom maintenance, a toilet, kitchen maintenance and fencing.

Submissions – Landlord

18. None.

Determination

19. The Tribunal determines a market rent for a property by reference to rental values generally and, in particular, to the rental values for

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comparable properties in the immediate locality. The Tribunal has no regard to the current rent and the period of time which that rent has been charged, nor does it take into account the percentage increase which the proposed rent represents to the passing rent. In addition, the legislation makes it clear that the Tribunal is unable to account for the personal circumstances of either the landlord or the tenant.

20. The Tribunal assesses the rent for the property as at the date of the landlord’s Notice and on the terms of the extant tenancy. The Tribunal disregards any improvements made by the tenant but has regard to the impact on rental value of disrepair which is not due to a failure of the tenant to comply with the terms of the tenancy.

21. In the first instance, the Tribunal determined what rent the landlord could reasonably be expected to obtain for the property in the open market if it were let today in the condition that is considered usual for such a market letting. In the absence of any comparable evidence from either party the Tribunal relied on its own expert knowledge as a specialist Tribunal. In doing so, the Tribunal determined that a figure of £2,200.00 per month is reasonable.

22. Once the hypothetical rent in good condition was established it was necessary for the Tribunal to determine whether the property meets the standard of accommodation, repair and amenity of a typical modern letting. In this instance the Tribunal determined that the subject property falls short of the standard required by the market.

23. In the Applicant’s 2022 application for a determination of rent the tenant described the property as dated and in need of general maintenance and modernisation. The kitchen and bathroom fittings were said to be the original and as in-situ when the [NAME] took up occupation in 1964. White goods, carpets and curtains were stated to be provided by the tenant. In the absence of any contradictory evidence from either party the Tribunal hereby value the property as if in a similar condition and with the same provisions as when last assessed in 2022.

24. In reflection of such differences the Tribunal make a deduction of 30% from the hypothetical rent to arrive at an adjusted rent of £1,540.00 per month.

25. The tenant made no submissions to the Tribunal in regard to delaying the effective date of the revised rent on grounds of hardship. Accordingly, the rent of £1,540.00 will take effect from 17 April 2023, that being the date stipulated within the landlord’s notice.

26. The rental figure determined by the Tribunal exceeds that proposed by the landlord. Such figure is the maximum rent payable. However, the landlord is under no obligation to charge the full amount.

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RIGHTS OF APPEAL

1. A person wishing to appeal this decision to the Upper Tribunal (Lands Chamber) must seek permission to do so by making written application by email to [EMAIL] to the First-tier Tribunal at the Regional office which has been dealing with the case.

2. The application must arrive at the Tribunal within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

3. If the person wishing to appeal does not comply with the 28 day time limit, the person shall include with the application for permission to appeal a request for an extension of time and the reason for not complying with the 28 day time limit; the Tribunal will then decide whether to extend time or not to allow the application for permission to appeal to proceed.

4. The application for permission to appeal must identify the decision of the Tribunal to which it relates, state the grounds of appeal, and state the result the party making the application is seeking.