Habib Choudhury v Paulina Madej

This is an appeal brought by a landlord against a determination of the market rent for the property, made by the First-tier Tribunal. It has been decided under the Tribunal’s written representations procedure; neither party has been legally represented.

The property is a converted studio flat in a four-storey end of terrace building. The respondent, Ms Paulina Madej, has been the tenant since September 2010. In February 2025 the appellant served a notice under section 13(2) of the Housing Act 1988 proposing a new rent of £1,600 per month in place of the existing £650 per month. Ms Madej referred the notice to the FTT under section 13(4) of the 1988 Act and the FTT determined the rent on 27 November 2025.

The FTT in its “Summary reasons” described the property and said this:

“Having consideration of the comparable evidence provided by the parties and of our own expert, general knowledge of rental values in the area, we consider that the open market rent for the property in good tenantable condition is £1,000 pcm.”

The FTT went on to make some deductions, for lack of white goods, arrangement and size, and disrepair and determined that the market rent was £750 per calendar month, which the FTT said was assumed to include the cost of electricity and water. It provided some “additional reasons” on the same date as its “Summary reasons” and said this:

“The property is a bedsit flat with a bedroom/living room/kitchen and separate bathroom. It appeared very small. The kitchen area was limited in facilities or space. The bed took up most of the living area. There was no separate living area or outside space. There was very little room for clothes storage. …

Although we derived limited assistance from the parties’ submissions at the hearing, we benefitted most from the inspection of the premises which gave a clear picture of a very small flat with very limited space and some prevalent disrepair. This formed the basis of our decision which was put in summary form before this one.”

The appellant asked for permission to appeal on the basis that the FTT appeared to have ignored comparable evidence offered by both parties that indicated a higher rent. In refusing permission to appeal the FTT said this:

“The Tribunal considered a wide variety of comparable evidence provided by the parties and using our own knowledge of the area. Because the individual comparators were not mentioned in turn does not mean they were not considered. This property was a very poor example of its type being small, neglected, poorly arranged and ill-equipped. The Tribunal did consider the location of the premises …]We found a particularly poor property with evidence of neglect by the landlord. The fixtures and fittings were in a poor state through wear and tear. The communal area had been refurbished but this flat had not. The white goods were sparse – 2 hobs, a small fridge both of which were in poor condition.”

The appellant has permission to appeal granted by this Tribunal on the basis that the FTT failed to explain why the market rent fell below that of the comparable properties offered by both parties.

The appellant said that some of the comparable properties to which he referred were flats in the same building. Furthermore, some of his comparables were the same as those supplied by the tenant to the FTT, and included smaller flats within the building achieving £1,300 to £1,350 per month. The FTT has not explained why it rejected that evidence. He also expressed disagreement with the deductions made by the FTT, with which this appeal is not concerned.

There is a disagreement between the appellant and the respondent about whether council tax is included in the rent; unfortunately, confusion was caused by the FTT stating in its refusal of permission to appeal that Council Tax was not included in the rent and then deleting that in an amended version of the refusal of permission. There was no mention of Council Tax in the decision now appealed, and so this point is not the subject of this appeal and is not an issue the Tribunal can determine.

The respondent points out that the FTT regarded its inspection as important, and says that it was entitled to reach the conclusion to which it came on that basis. It did not have to set out all the comparable evidence. In her statement of case the respondent has described the property, emphasising how small it is and the limited storage space. The comparable properties by contrast are in good condition. The respondent disputes the accuracy of what the appellant says about the comparable properties; I am not going to set out the detail of what she said since it is not for this Tribunal to make an assessment of the comparables.

The FTT in making determinations of market rent is under pressure of time, which will only increase following the coming into force of the Renters Rights Act 2025, and I am very conscious of the need for the FTT judges and members to be able to work confidently and efficiently. They are not required to set out every item of evidence, nor to waste time setting out material that is well-known to the parties. But they are obliged to explain their decision so that the losing party knows why he or she has lost. To that end, if there is evidence that they reject they need to engage with that evidence in their written reasons and to do more than simply state that they reject it. They need to say, however briefly, what that evidence was, and why they have rejected it.

In the present case the FTT did not do that. Merely saying that it had considered the comparables is not enough. It was permissible for the FTT to use its own experience of the area, as an expert Tribunal; but since the panel had been provided with evidence which was said by the landlord to indicate a higher market rent it was important that they say what that evidence was and why they disagreed with the landlord. Reams are not required; a few sentences would suffice. What was given in this case was well on the wrong side of what was required.

The FTT gave some further reasoning both in its additional reasons and in its refusal of permission to appeal. Those further reasons really did not help. The size of the property is of course relevant; but the landlord says that some smaller flats are fetching higher rents, and so he needs to know why the market value, before deductions, of this flat was found to be lower. And the condition of the property is also, of course, relevant, but it is not relevant to the market value, which is to be determined in accordance with section 14 of the Housing Act 1988, disregarding neglect by the landlord. Instead it is relevant to the level of deduction made, and so for the FTT to explain its view of market value by reference to neglect and to the lack of equipment does not mend matters – and indeed leaves one with no confidence that the FTT took into account relevant matters and disregarded irrelevant ones.

In light of that I set aside the FTT’s decision because it was not explained. I set it aside as a whole, both the market rent and the deductions. Any comments later made and deleted about Council Tax are of no effect. The matter is remitted to the FTT to be determined afresh by a different panel.