Flat 8 Caroline House, Bayswater Road, London W2 4RQ LON/00BK/F77/2021/0068

FIRST-TIER TRIBUNAL

PROPERTY CHAMBER (RESIDENTIAL PROPERTY)

Case No LON/00BK/F77/2021/0068

Between

Miss Angela WilliamsApplicant

Glassrose LtdRespondent

Miss Angela WilliamsTenant

Glassrose LtdLandlord

Before

Mr R Waterhouse FRICS

Date 18 May 2021

Property: Flat 8 Caroline House, Bayswater Road, London, W2 4RQ

REASONS

[1]The Tribunal gave formal notice of its decision by a Notice dated 17 May 2021 of £ 25,700 per annum with effect from the same. On the 22 September 2020 the Landlord of the Property applied to the Rent Officer for re registration of a fair rent of £ 30,000 per annum, the rent having been previously registered on November 2018 at £26,800 per annum. On the 24 November 2020, the Rent Officer registered a fair rent of £25,800 per annum with effect from 22 December 2020. In a letter dated 15 December 2020 the Landlord objected to the rent determined by the Rent Officer and the matter was referred to the First –tier Tribunal (Property Chamber) (Residential Property). Directions were issued by the Tribunal on the 3 March 2021. In those Directions, the parties were informed that in accordance with Public Health England’s advice to avoid unnecessary travel and social interaction for the time being, the Tribunal would not hold an oral hearing, unless so requested by either or both the parties, or would it inspect the property. Neither party has requested a hearing. Thereafter, the Directions made provision for the filing with the Tribunal of the parties’ respective written submissions and, in particular, for the completion of a reply form giving details of the Property and including any further comments the parties wished the Tribunal to take into account in making its determination. In due course, the Landlord and the Tenant filed their written submissions. The tenancy is a statutory (protected) periodic tenancy. The tenancy (not being for a fixed tenancy of 7 years or more) is subject to section 11 of the Landlord and Tenant Act 1985 which sets out the landlords statutory repairing obligations; the tenant is responsible for internal decorations. Following the issue of the Tribunals decision which was based on the written and visual evidence submitted by the parties that was germane to the determination of a fair rent, the Landlord sought extended reasons for the Tribunal’s decision. The Property The property is a centrally heated first floor flat within a 1950 block on the north side of Bayswater Road. The block has a lift to the first floor, and the flat is double glazed. The accommodation comprises three bedrooms, kitchen, bathroom and separate WC. The tenant provides the carpets, curtains and white goods. Relevant Law Provisions in respect of the jurisdiction of the Tribunal and the determination of a fair rent are found in Schedule 11, Part 1, paragraph 9(1) to the Rent Act 1977, as amended by paragraph 34 of the Transfer of Tribunal Functions Order 2013, and section 70 of the Rent Act 1977. Rent Act 1977

[2]Schedule 11, Part 1, paragraph 9 (as amended) “Outcome of determination of fair rent by appropriate tribunal 9.-(1) The appropriate tribunal shall-(a) if it appears to them that the rent registered or confirmed by the rent officer is a fair rent, confirm that rent;

(b) if it does not appear to them that that rent is a fair rent, determine a fair rent for the dwelling house.” Section 70: Determination of fair rent (as amended) “(1) In determining, for the purposes of the Part of this Act, what rent is or would be a fair rent under a regulated tenancy of a dwelling house, regard shall be had to all the circumstances (other than personal circumstances) and in particular to- (a) the age, character, locality and state of repair of the dwelling-house, … (b) if any furniture is provided for the use under the tenancy, the quantity, quality and condition of the furniture [, and

(c) any premium, or sum in the nature of a premium, which has been or may be lawfully required or received on the grant, renewal, continuance or assignment of the tenancy.] (2) For the purposes of the determination it shall be assumed that the number of persons seeking to become tenants of similar dwelling-houses in locality on the terms (other than those relating to rent) of the regulated tenancy is not substantially greater than the number of such dwelling-houses in the locality which are available for letting on such terms.

[3](3) There shall be disregarded-(a) any disrepair or other defect attributable to a failure by the tenant under the regulated tenancy or any predecessor in title of his to comply with any terms thereof;

(b) any improvement carried out, otherwise than in pursuance of the terms of the tenancy, by the tenant under the regulated tenancy or any predecessor in title of his; (c), (d) …[repealed] (e) if any furniture is provided for use under the regulated tenancy, any improvement to the furniture by the tenant under the regulated tenancy or any predecessor of his or, as the case may be, any deterioration in the condition of the furniture due to any ill-treatment by the tenant, any person residing or lodging with him, or any sub-tenant of his.”

[4]Consequently, when determining a fair rent the Tribunal, in accordance with the Rent Act 1977, section 70, has regard to all the circumstances including the age, location and state of repair of the Property. It also disregards the effect of(a) any relevant Tenant’s improvements and

(b) the effect of any disrepair or defect attributed to the Tenant of any predecessor in title under the regulated tenancy, on the rental value of the Property. In Spath Holme Ltd v Chairman of the Greater Manchester etc. Committee

(1995) 28 HLR 107

and Curtis v London Rent Assessment Committee

[1999] QB 92

the Court of Appeal emphasised:

[5]

(a) that ordinarily a fair rent is the market rent for the property discounted for “scarcity” (i.e. that element, if any, of the market rent, that is attributable to there being a significant shortage of similar properties in the wider locality available for letting on terms- other than as to rent- to that of the regulated tenancy) and

(b) that for the purposes of determining the market rent, assured tenancy (market rents) are usually appropriate comparables. (The rents may have to be adjusted where necessary to reflect any differences between the comparables and the subject property).

[6]In considering scarcity under section 70 (2), the Tribunal recognises that:(a) there are considerable variations in the level of a scarcity in different parts of the country and that there is no general guidance or “rule of thumb” to indicate what adjustments should be made; the Tribunal, therefore, considers the case on its merits;

(b) terms relating to rents are to be excluded. A lack of demand at a particular rent is not necessarily evidence of scarcity; it may be evidence that the prospective tenants are not prepared to pay that particular rent.

[7]Fair rents are subject to a capping procedure under the Rent Acts (Maximum Fair Rent) Order 1999 which limits increases by a formula based on the proportional increase in the Retail Price Index since last registration. The only exception to this restriction on a fair rent is provided under paragraph 7 of the Order where a landlord carries out repairs or improvements which increase the rent by 15% or more of the previous registered rent. Submissions Landlord M Yale Limited representing the landlord note in a letter dated 22 September 2020 to the Rent Officer that an objection to the rent Officer determination would be made because the rent registered was “1. Lower than current rent and 2. The issues the

[8]Tenant advised you of are outside my client’s control.” The application for reregistration objection to the registered rent made to Rent Officer by letter dated 22 September 2020 requested a rent of £30,000. Tenant The tenant notes in a letter dated 4 October 2020, to the Rent Officer , that there is water damage to the ceiling of the third bedroom, and to the ceiling of the WC. Tenant notes that the kitchen and bathroom form part of their improvements, decorating undertaken by tenant and no intercom present. The tenant’s submission included a number of photographs showing flaking paint and damp ceilings. The tenant notes in the “Reply form” in the Improvements section that; “flat wallpapered and painted throughout every 5 years since 1976….carpets and curtains every 5 years…Kitchen W/H , d/w double oven and grill every 10 years Tiling of walls and floor…Bathroom and shower, Sink replaced matching bath. Floors & Walls Tiles. By Tenant “. Under the section “Disrepairs/Defects: The tenant notes “Ceiling in wc peeling from flood above, has been like it for 2 years. Ditto 3rd Bedroom Not redecorated as yet. The wiring is 1950’s. The c/H has no thermos Stats, The plumbing is 1950s.” Under the section “Any other comments” “I have the underground noise from Bayswater (Circle Line) Queensway (Central Line) This starts at 6 am every day from the windows in my bedroom. Radiators inadequate, as my bedroom faces North, the only radiator to mini! These radiators are too small, as fitted in 1950s.” Reasons for Decision Initially 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 an open market letting. In the absence of any material evidence as to the market, the Tribunal acting in its capacity as an expert tribunal and using its general knowledge of market levels in the area, concluded that such a likely market rent , if a market rent is adopted would be £42,000 per annum. However, the Property is not in the condition considered usual for a modern letting at a market rent. Therefore, it is necessary to adjust the above hypothetical rent of £42,000 per annum, a deduction of 15% is made. The adjusted rent is £35,700 per annum. In addition, the Tribunal determined that there should be a further deduction of 10% to reflect the fact the Tenant provided the floor coverings, curtains and white goods and is responsible for internal decorating. The rent after this adjustment is £32,130. Thereafter the Tribunal considered the question of scarcity in section 70 (2) of the Rent Act 1977. A figure of 20% was adopted. The rent after this final adjustment was £25,700 per annum.

[9]Rent Acts (Maximum Fair Rent) Order 1999 The rent to be registered is not limited by the Rent Acts (Maximum Fair Rent Order) 1999 because it below that maximum fair rent, £29,298.0 per annum. Accordingly, the sum of £25,700 per annum will be registered as the fair rent with effect from 17 May 2021 being the date of the Tribunal’s decision. Valuer Chair: Richard Waterhouse FRICS Date: 25 May 2021

[10]Appeal to the Upper Tribunal A person wishing to appeal this decision to the Upper Tribunal (Property Chamber) on a point of law must seek permission to do so by making a written application to the First-tier Tribunal at the Regional Office which has been dealing with the case which application must:a. be received by the said office within 28 days after the Tribunal sends to the person making the application written reasons for the decision.

b. 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. If the application is not received within the 28 –day time limit, it must include a request for an extension of time and the reason for it 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.