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scholland
13-03-2010, 17:11 PM
Can anyone help?
My tenants have recently had their rent reassessed and the rent assessment committee who aren't even fron the same city have reduced the rent by £300 per month for the remaining 6 months of the tenancy.
Apparently I have no right of appeal?
The ast contract they signed was for 12months from 1st july09 but they now pay reduced rent for the last 6months which doesnt even cover the interest on my mortgage!
Is there anything I can do or are AST contracts not worth the paper they're written on?
Would appreciate anyones advice!!!

P.Pilcher
14-03-2010, 10:26 AM
This one is a bit mysterious. Rent assessment committees are, I believe, only enpowered to act when a landlord wishes to increase rent under section 13 and the tenant considers the proposed increase excessive, otherwise, during the fixed term of an AST they have no power, -particularly when the rent is fixed by the AST.
Is this a case of rent act tenants (who have been tenants since before 1988) being asked by you to sign an AST, which they have mistakenly done when a rent assessment committee WOULD have power to make draconian reductions in rent below current market levels. (Thank you Mr. Harold Wilson!)

P.P.

matthew_henson
14-03-2010, 10:37 AM
Can anyone help?
My tenants have recently had their rent reassessed and the rent assessment committee who aren't even fron the same city have reduced the rent by £300 per month for the remaining 6 months of the tenancy.
Apparently I have no right of appeal?
The ast contract they signed was for 12months from 1st july09 but they now pay reduced rent for the last 6months which doesnt even cover the interest on my mortgage!
Is there anything I can do or are AST contracts not worth the paper they're written on?
Would appreciate anyones advice!!!

When did tenant first take occupancy?

scholland
14-03-2010, 15:37 PM
It's a mystery to me too! The tenants signed the ast contract for 12months from 1st july09-30jun10.
The rent assessment committee can apparently determine the rent payable on any property regardless of the fact that a contract has been signed, as long as the tenants apply to have the rent asessed within the first 6months of the tenancy starting.
I have rented this property for years and never come across it before but it's a frightening prospect that anyone can apply to have their rent assessed as we all know that properties rented to students achieve higher rents than those rented to families etc. The government apparently set up these committees who are supposed to be impartial and the law is section 22 of the housing act 1988?
The road my property is on is full of student lets, all renting for similar amounts and yet they have still reduced the rent by £300 per month!!
Just wondered if anyone could advise what if anything I can do about it as the information booklet says I can only appeal to the high court under the tribunals and inquiries act 1992 if I consider the committee has made a mistake of law. I would have thought altering the amount of rent on a signed contract was a mistake of law but I doubt the costly expense of trying to go to High court without legal representation would help me!! Any ideas anyone?:confused:

P.Pilcher
14-03-2010, 20:38 PM
I await with interest the comments that our legal experts have to make about this one. As far as I am concerned, under the circumstances you state, I do not believe that a rent assessment panel has any power and that it is possible that they have been misinformed by your tenant who is now applying the decision that they have reached in error. It is certainly to the tenant's advantage to do this which is why this panel has been misinformed!

Quite honestly, if tenants can appeal any fixed and established rents to such a panel who consider themselves empowered to make such draconian reductions, then just about every non-social landlord in the country will be selling up!
The lack of private rental accommodation was the very reason that Maggie Thatcher ended Harold Wilson's housing acts which empowered these rent tribunals in 1988.


P.P.

scholland
15-03-2010, 07:59 AM
Thanks for your comments. I'm glad I'm not the only one who sees the implications of this. If i can't do anything about it it makes a mockery of an AST contract and if my tenants no longer have to adhere to the contract then presumably neither do I?
These tenants leave in 3 months but I'm concerned that if others get wind of this apparent law they can apply to have rent reductions, then I definately may as well sell!!
What's really frustrating with this panel, is i sent so much evidence to show that this is the average rent charged for that area and I even put in a mortgage statement to show the amount of interest I pay and yet they have come up with a rent figure that doesnt even cover the mortgage interest, let alone insurance etc etc.
My letting agent also sent in lists of properties for rent but they seem to have completely ignored all evidence!
I await with interest for anyone who can shed any more light on this, I hope they can for all student landlords sakes!!

P.Pilcher
15-03-2010, 14:28 PM
As a non-legal landlord, I regret that I can advise you no further than I already have, but should our legal experts be prepared to advise further, they will need to know:

(i) Whether this tenancy is in England & Wales
(ii) Whether the tenants have been living in the property before the current AST was granted.
(iii) If so, when they first moved into the property.
(iv) If you have a copy of the "judgement" made by this rent assessment panel, under what housing act and which subsection they are claiming gave them authority to act in this instance.

P.P.

scholland
15-03-2010, 17:04 PM
The answers to those questions are
1/ the tenancy is in England.
2/The tenants did not live at the property before the start of the AST contract.
3/ They moved in 1/7/09 when the contract began.
4/Housing Act 1988-section 22
where a tenant under an AST is dissatisfied with the rent payable within the first 6 months of tenancy they can apply to the RAC for a determination of rent.

P.Pilcher
15-03-2010, 17:23 PM
Well: If this is fact then it is the reason that the majority of us do not grant AST's with fixed terms of over six months but it is the first time that I have ever heard of this particular regulation. In all the years I have been browsing this and other boards, I have never before heard of a rent being reduced in this way which, in view of the terms on which you claim this rent assessment committee can operate is very suprising. I assume that you will not grant a fixed term longer than the minimum again!

What is more suprising is that if section 13 is used to raise the rent in a statutory periodic or assured tenancy and the tenant objects to the proposed increase, then the rent assessment committee is required to consider the proposed increase with regard to commercial rents being charged for similar properties in the same locality. It would appear from what you say that this particular rent committee disregarded this information in coming to their decision.


P.P.

scholland
16-03-2010, 06:24 AM
This law seemingly still applies to any AST contract whether it's 6months or 12months. The benefit of having a 6month tenancy would be that they would have been leaving now so I wouldnt have to deal with them anymore. But my understanding is that the tenant can file a claim anytime within the first 6 months of the tenancy ie the day after the tenancy began and if successful, the RAC back dates the claim to the day it was made. So even a 6month contract could be affected in the same way.
What I really need to know is whether the AST contract they signed is still valid? Surely they can't pick and choose which parts of it they want altering? So if the rent they agreed and signed for no longer applies, do the rest of the terms of the contract no longer apply? I may be cutting my nose off to spite my face but I'd like to get them to leave if I can and try to find new tenants rather than let them stay there costing me money!!:mad:

Paul Gibbs
16-03-2010, 07:55 AM
Scholland is correct. Applications to Rent Assessment Committees are rare due to the fact that the tenant does not have any long term security of tenure.

The committee should only have made a decision if they felt that there were a sufficient number of similar dwellings let on similar tenancies, and that the rent claimed was significantly higher.

P.Pilcher
16-03-2010, 11:51 AM
Having now done my "due dilligence" and read section 22 of the 1988 act it would appear that the assessment committee has the same powers during the first six months of a new AST with regard to the rent charged as it does during a section 13 procedure. However, from what Scholland is telling us is that the assessment committee did not consider rents for similar properties that were being charged in the area and, it would appear, disregarded evidence of this that Scholland himself submitted. Is there no appeal? Sounds a little draconian to me under the circumstances.

P.P.

jeffrey
16-03-2010, 12:03 PM
One difference in the Committee's powers is that:
a. section 13 applies to ASTs and SATs; whilst
b. section 22 applies only to ASTs.

scholland
16-03-2010, 22:27 PM
It seems after various checks with legal people that I can do nothing about this so just to advise you all that a solicitor who specialises in contracts has suggested that all my future AST contracts should have a clause in them which says that all tenants agree the market rent is fair and will not pursue any claim to suggest otherwise.
I have tried to contact the committee who determined the rent for a reason behind their decision and they said they will post me their reasons in the next 2-3weeks!!!! Very helpful!!!
I can only assume that they have determined the rent payable at such a reduced rent based on 3 people living in the house, even though it is a 4 bedroomed property(and I mean 4 bedroomed, not including any ground floor lounge!) because 3 of them agreed to pay for the rent to be split between them as they didnt have a fourth person. So anyone deciding to do that, please beware!!

jeffrey
16-03-2010, 22:29 PM
It seems after various checks with legal people that I can do nothing about this so just to advise you all that a solicitor who specialises in contracts has suggested that all my future AST contracts should have a clause in them which says that all tenants agree the market rent is fair and will not pursue any claim to suggest otherwise.
That will not work. The parties cannot oust the Court's jurisdiction.