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Property Hawk

RENT DISPUTES BETWEEN LANDLORD AND TENANT

Ever since the deregulation of the private rental sector brought in by the Housing Act in 1988 landlords have been permitted to charge a market rent.  This permission includes the ability to raise the rent on their rental properties when they see fit. However, this law still allows a tenant to challenge any rent increases a landlords attempts to make.

Prior to the 1st July 2013, tenants were able to challenge the rent increase by a private landlord and the appeals were heard by a Rent Assessment Committee, but following changes in the system, a tenant will now need to apply to a First-tier tribunal chamber (Residential Property) if they don’t agree with an increase in their rent. 

You can download the full guidance on rent cases under the Tribunal.

First-tier tribunal property chamber

This Tribunal normally comprises of 3 people:

a) (the chairman), who will usually be a lawyer or surveyor, is responsible for the conduct of the case and will write the reasons for the tribunal’s decision;
b) A lay person
c) A qualified member (likely to be a surveyor or valuer)

In addition to these Tribunal members there is an executive officer or case officer who manages the process from start to finish, dealing with the application and any correspondence until the parties have received the final decision. These case officers are able to speak to parties about the procedures relating to the application, but they cannot give legal advice or interpret the tribunal’s decision.

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What do rent tribunals decide upon?

The Rent Tribunal has the power to decide on whether a proposed rent is an ‘open market rent’ and also a ‘fair rent’ under the Rent Act 1977.

In the case of market rents the Tribunal can deal for the following 4 types of cases:

i) In the case of landlord trying to increase the rent using a Section 13 Notice a tenant can appeal to the First-tier Tribunal Property Chamber for a determination of the fair market rent.

ii) They can also decide on whether the rent charged by landlord is excessive under section 22 of the Housing Act (this can be only done within the first 6 months of a tenancy).

iii) Where a Fixed Term Assured, or Assured Shorthold Tenancy has come to an end and the landlord or tenant has, by notice under section 6 of the Housing Act 1988, proposed new terms for the statutory periodic tenancy which has automatically started. The recipient can refer the notice to this Tribunal for it to determine the new terms, including rent.

iv) Where there has been an application to the tribunal under the Local Government and Housing Act 1989 where a long lease at a low rent has expired

Rent tribunals in operation

In cases of tenancies under an Assured Shorthold Tenancy (AST) determinations the Residential Property Tribunals (RPT) will only determine the application if it considers there are enough similar properties locally using an AST and that the rent is not significantly higher.  If those conditions are met then the RPT will determine the rent the landlord should reasonably obtain.  You should be clear that the Tribunals are not a form of rent control as practiced at various periods during the last 100 years.

Under an AST landlords remain in control.  Despite the checks and balances suggested by the right to appeal to the RPT; the reality is that the balance of power when it comes to the rent a landlord can charge remains with the landlord.  This is because of the right of the landlord to seek possession through a Section 21 Notice.

We provide users with a free Section 21 Notice.

If you are unhappy with the rental amount suggested by any determination then you can end the tenancy using this notice.  It means on expiry of the correctly served notice a landlord has the right to ultimately obtain possession of a rental property.

Most tenants realise this and therefore are reluctant to challenge a landlord if they decide to increase the rent.  The tenant also has the right to give notice to leave and search for a more affordable rental property.

Read more on how Rent Tribunals Operate

How does the tribunal decides on a fair rent?

Typically a rent tribunal will make a decision based on the documents submitted to them.  However, if one of the parties requests it then they have a right to attend an oral hearing.

What happens in an oral hearing?

In the London region, oral hearings are held at the London
regional office. In other regions, the oral hearing could take place at the regional office but is more likely to take place at a venue as near to the property as is practical. In special cases the hearing venue may be the property itself.

A party can speak for themselves or someone else, whether professionally qualified or not. They will also be able to put any relevant questions to the other party. The members of the Tribunal will try to put people at their ease and will also ask some of their own questions.  If anything is unclear during the hearing, parties are encouraged to ask the Tribunal for clarification.

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Inspections of the rental property

The Tribunal may inspect the rental property if requested by either party or if they consider it necessary. A visit is considered necessary in most rent cases, although, if the Tribunals dealing with a number of similar rental properties at the same time, it may inspect a sample only. A visit will take place on a date and at an approximate time notified to the parties. With the permission of the tenant, the landlord is entitled to be present and members of the Tribunal will normally want to inspect the inside of the property as well as the outside and any common parts. Any inspections tend to be on the day of the hearing.

The inspection can be used by either party to draw attention to any physical aspect of the property or its surroundings, but nothing further. For example, a damp patch in a rental property can be pointed out but not any suggestion made as to why it appeared. ’

Representations‘ (arguments and evidence) will either have been made in writing already or will be made at the oral hearing if one has been requested. If the members of the Tribunal are unable to gain access to the rental property at the appointed time, they may decide to make another appointment or they may decide that they have sufficient information to go ahead and make their decision.

How will the rent be decided?

In market rent cases (assured or assured shorthold tenancies), the Tribunal, when determining a rent, will look at the market for similar rental properties in the area, evaluating 'comparable' rents paid on similar
properties. Parties are encouraged to provide evidence of comparable rents. The Tribunal will ignore any improvements by the tenant to ensure that such improvements will not have the effect of inflating the rent.

For 'fair rents' (under the Rent Act 1977), the Tribunal will first make a similar assessment of the market rent for the property (again ignoring the effect on the rent due to any tenant’s improvements) and then consider whether there is a scarcity of similar properties in the area. If so, a deduction will be made to reflect that scarcity.

It is important to note that where a fair rent is already registered, and an application is made to the rent officer for an increased rent, there is a limit on the amount of any rental increase. This is sometimes called the rent ‘cap’ or the ‘capped rent’. It is calculated in accordance with a formula set out in the Rent Acts (Maximum Fair Rent) Order 1999 which only permits an increase in a fair rent which is linked to the retail prices index (RPI).

Where a landlord has repaired or improved the property to the extent that such change would result in an increase in the rent last registered or confirmed of at least 15%, the ‘cap’ will not apply.  Council tax is normally paid by the tenant direct, and does not come into the assessment. However, if the property is a flat in a ‘house in multiple occupation’, the landlord will be responsible for the council tax and part of that will be included in the rent.

How does a rent tribunal assess any service charges?

Service charges are sometimes charged by landlords as part of, or in addition to the rent. They include charges for matters such as gardening, cleaning or electricity in the common parts. In fair rent cases, the Tribunal will include the value of such services to the tenant in the rent. However, some tenancy agreements provide that the charge for services may be changed from time to time (usually every 12 months) to reflect changes in the costs of providing the services. If that is the case, the rent officer or the Tribunal may register the fair rent as variable. If this is the case the landlord will be able to increase the service chargebefore the next application for registration of a new fair rent without coming back to the rent officer.

In market rent cases, where the tenancy provides for a variable service charge (where the amount payable is linked to the cost of the service), the rent determined by the tribunal will not include the charge for services. Thus the service charge will be payable in addition to the rent determined by the tribunal. In all cases (fair rent or market rent) where there is a variable service charge, an application as to the reasonableness of the charges can be made to the Tribunal at any time under the Landlord and Tenant Act 1985. This only applies in fair rent cases where the rent has been registered under the 1977 Act as variable.

‘Supporting People’ charges

If the tenancy provides for payment of ‘supporting people’charges, these are normally payable in addition to the rent and service charges. However, the tribunal may decide that some or all of these charges should be included within the service charge.

Right of appeal of rent tribunal

 

It is possible for a landlord to appeal any decision of the Tribunal to the Upper Tribunal (Lands Chamber). A landlord must apply for permission to appeal in writing.


Have a read of this insightful piece about the Residential Property Tribunal (RPT)

For examples of rents determined  use this searchable database of Market Rent determinations

Details of the tribunal regional offices


Northern Region:

1st Floor
5 New York Street
Manchester
M1 4JB

Tel: 0845 1002614    0161 237 9491
Fax: 0161 237 3656

This office covers the following Metropolitan districts:
Barnsley, Bolton, Bradford, Bury, Calderdale, Doncaster, Gateshead, Kirklees, Knowsley, Leeds, Liverpool,
Manchester, Newcastle-upon-Tyne, Oldham, Rochdale, Rotherham, St. Helens, Salford, Sefton, Sheffield, Stockport, Sunderland, Tameside, Trafford, Tyneside (N
orth & South), Wakefield, Wigan and Wirral.
It also covers the following unitary authorities:
Hartlepool, Middlesbrough, Redcar and Cleveland, Darlington, Halton, Blackburn with Darwen, Blackpool, Kingston-upon-Hull, East Riding of Yorkshire, Northeast Lincolnshire, North Lincolnshire, Stockton-on-Tees,Warrington and York.

It also covers the following counties:
Cumbria, Durham, East Cheshire, Lancashire,
Lincolnshire, Northumberland, North Yorkshire and West
Cheshire.

Midland Region:

3rd Floor
Temple Court
35 Bull Street
Birmingham
B4 6AF

Tel: 0845 100 2615 or 0121 681 3084
Fax: 0121 681 3056

This office covers the following Metropolitan districts:
Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton. It also covers the following unitary authorities: Derby, Leicester, Rutland,
Nottingham, Herefordshire, Telford and Wrekin and Stoke-
on-Trent.

It also covers the following counties:

Derbyshire, Leicestershire, Nottinghamshire,
Shropshire, Staffordshire, Warwickshire and Worcestershire.


Eastern Region:

Unit 4C
Quern House
Mill Court
Great Shelford
Cambridge
CB22 5LD

Tel: 0845 1002616 or 01223 841 524
Fax: 01223 843 224

This office covers the following unitary authorities:
Bracknell Forest, West Berkshire, Reading, Slough, Windsor and Maidenhead, Wokingham, Luton,
Peterborough, Milton Keynes, Southend-on-Sea and Thurrock.

It also covers the following counties:
Bedfordshire, Berkshire, Buckinghamshire,
Cambridgeshire, Essex, Hertfordshire, Norfolk, Northamptonshire, Oxfordshire and
Suffolk.

London Region:

1st Floor
10 Alfred Place
London
WC1E 7LR

Tel: 020 7446 7700
Fax: 020 7637 1250

This office covers all the London boroughs.

Southern Region

1st Floor
1 Market Avenue
Chichester
PO19 1JU

Tel: 0845 1002617 or 01243 779394
Fax: 01243 779389

This office covers the following unitary authorities:

Bath and Northeast Somerset,
Bristol, North Somerset, South Gloucestershire, Bournemouth, Plymouth, Torbay, Poole,
Swindon, Medway, Brighton and Hove, Portsmouth, Southampton and the Isle of Wight.
It also covers the following counties:

Cornwall and the Isles of Scilly, Devon, Dorset,
East Sussex, Gloucestershire, Hampshire, Kent, Somerset, Surrey, West Sussex, Wiltshire.

Landlord insurance - portfolio rates available

Comments (5)

Rental Agreement
I was renting on a 12 month agreement but bought a house 6 months into agreement. I gave 2 months notice but the landlord and agency agreed to look for new tenant if I paid the landlord fees. The relationship of the landlord and agency has since gone downhill and the landlord will not communicate with the agency. They have had tenants but he has decided not to go ahead. I am still paying the rent. The agency say I could stop paying as he is been obstructive. Please advise
#1 - Suzanne Eleftheriou - 10/22/2013 - 15:38
Advise on Rental Agreement
For free legal advice landlords should register for our landlord forum and post their questions there. Thanks PH
#2 - Property Hawk - 12/12/2013 - 09:00
agent and Tennant bbeing evasive.
I have had trouble getting any rent from my Tennant. My agent only passes on bits and pieces of iinformation. I am unable to get any info about the dss arrangements,from either. Also ,they, the tennent,refuse to answer the door when I attend. There, has been arrangements made for inspection,but the agent does not pass on details ,although I am aware that one was missed. Can you advise please?
#3 - andrew - 12/15/2013 - 14:13
Post #3 from Andrew
The procedure in post #2 applies. Please repost on Forum.
#4 - Jeffrey Shaw - 12/16/2013 - 15:17
Landlord's extreme reaction
During our tenancy in an unfurnished private rental, we asked for the removal of remaining landlord's possessions, in line with our rental agreement but without success. Immediately following a visit of the landlord to discuss the matter, we were given notice to leave in accordance with the rental agreement. We treat the property very well and in all respects we are model tenants. We were simply asking for conformity to our agreement on a minor point. My wife is undergoing an extended sequence of treatment for a tumour and the additional stress of another house move wihthin 6 months is unhelpful. We are a mature couple renting an executive property in Surrey. The agent was disinterested and the landlord's action is extreme. Have we any options here?
#5 - Mike Bass - 06/20/2015 - 09:07
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