Tribunal Sets Maximum Fair Rent for Property

OUTCOME: Allowed

FR24 First-tier Tribunal – Property Chamber File Ref No. LON/00BF/F77/2019/0160

Notice of the Tribunal [NAME] 1977 Schedule 11

Address of Premises The Tribunal members were 84 [ADDRESS], [POSTCODE]

Judge Robert Latham Mrs Sarah Redmond BSc (Hons) MRICS

Landlord [COMPANY]

Tenant Mr [APPELLANT] & Mrs [APPELLANT]

1. The fair [NAME] is 170.50 Per Week (excluding water rates and council tax but including any amounts in paras 3&4)

2. The effective date is 22 November 2019

3. The amount for services is 10.41 Per Week

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

n/a Per

negligible/not applicable

5. The [NAME] is not to be registered as variable.

6. The capping provisions of the [NAME] ([NAME]) Order 1999 apply (please see calculation overleaf).

7. Details (other than [NAME]) where different from [NAME] entry

8. For information only:

(a) The fair [NAME] to be registered is the maximum fair [NAME] as prescribed by the [NAME] ([NAME]) Order 1999. The [NAME] that would otherwise have been registered was £210 per week including £10.41 per week for services.

Chairman Mr Robert Latham Date of decision 22/11/2019

FR24 [NAME] FIGURE X 291

PREVIOUS RPI FIGURE Y 274.7

X 291 Minus Y 274.7 = (A) 16.3

(A) 16.3 Divided by Y 274.7 = (B) 0.059337

First application for re-registration since 1 February 1999 YES/NO

If yes (B) plus 1.075 = (C)

If no (B) plus 1.05 = (C) 1.109337

Last registered [NAME]* 153.50 Multiplied by (C) = 170.28 *(exclusive of any variable service charge)

Rounded up to nearest 50p = 170.50

Variable service charge NO If YES add amount for services

[NAME] = £170.50 Per week

Explanatory Note

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

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

(a) increasing the previous registered [NAME] 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 [NAME] determination was made.

4. The process differs where the tenancy agreement contains a variable service charge and the [NAME] is to be registered as variable under section 71(4) of the [NAME] 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 [NAME].

© CROWN COPYRIGHT

FIRST-TIER TRIBUNAL PROPERTY CHAMBER (RESIDENTIAL PROPERTY) Case Reference : LON/00BF/F77/2019/0160 Property : 84 [ADDRESS], [POSTCODE] Landlord : [COMPANY] Tenant : Mr [APPELLANT] and Mrs V [APPELLANT] of Application : Assessment of [NAME] Tribunal Members : Judge Robert Latham Sarah Redmond MRICS Date and venue of Determination : 10 [ADDRESS] [POSTCODE] 22 November 2019 Date of Decision : 22 November 2019

REASONS FOR DECISION

1. On 1 July 2019, the landlord applied to the [NAME] for re-registration of a fair [NAME] of £155.79 for 84 [ADDRESS], [POSTCODE] (“the house”) pursuant to Part IV of the [NAME] 1977 (“the Act”). The landlord asked for £10.41 pw to be included in the [NAME] in respect of service charges. A [NAME] of £116.28 was being paid at the time.

2. On 1 August 2017, the [NAME] had registered a [NAME] of £153.50 per week, of which £8.12pw was attributable to services. It is not the practice of the landlord to collect the full [NAME], but rather charge a lower “social [NAME]”.

3. On 13 August 2019, the [NAME] assessed a fair [NAME] of £169.50 pw. She recorded that £6.94 is attributable to services. She first assessed a fair [NAME] of £210 pw. She then assessed the “capped [NAME]” pursuant to The [NAME] ([NAME]) Order 1999 and computed this to be £169.50 pw. As this

2 was lower than the fair [NAME], this was the [NAME] which was registered. The [NAME] recorded that £6.94 pw was attributable to services.

4. On 29 August, the landlord requested the [NAME] to refer the matter to the First-tier Tribunal (Property Chamber) (the “Tribunal”). The landlord makes one point, namely that the sum attributable to services should be £10.41 pw. The landlord has provided service charge statements to support this figure.

5. The landlord notes that it will not be charging the tenants the registered [NAME], but rather a social [NAME] of £116.01 per week (inclusive of service charge).

6. The Tribunal concluded that it is not necessary to inspect the house for two reasons:

(i) The registered [NAME] will be a capped [NAME] as this is lower than the fair [NAME] which we would determine.

(ii) The landlord does not intend to charge the registered [NAME], but rather a lower social [NAME].

7. Neither party has questioned the fair [NAME] of £210 pw which has been computed by the [NAME]. We therefore confirm this. We are required to compute the “capped [NAME]” as at todays date, rather than 13 August 2019, the date taken by the [NAME]. As a result of this, we compute the capped [NAME] to be £170.50 pw. This will apply for two years from today’s date, rather than from 13 August.

8. We record that £10.41 pw is attributable to services. We accept the figure proposed by the landlord. It would seem that the [NAME] made an arithmetical error.

9. However, the landlord has indicated that it will not be charging this registered [NAME] of £170.50 pw, but rather a social [NAME] of £116.01 pw.

Judge Robert Latham 22 November 2019