Terms & Conditions

[chris harvey]

Appreciate any views on this case, the likes of which I have not come across before and I’m not sure what to do for the best.
A couple, one is disabled and the other gets Carers Allowance. They move into an RSL property which is shared ownership, the rental part is 32%. They do not receive any care services from the landlord or anyone else. The rent charge totals £91 p/w made up of £40 pure rent and £51 accommodation related services. The RSL have provided a breakdown of these services and they include things like management charges, gas servicing, essential repairs and maintenance. The RSL have said the £40 represents 32% of the basic costs of the property but the services have all been loaded 100% onto the rental element because they do not charge for services as part of the ownership side of the equation. The property has 3 bedrooms, and there is no-one else in the household.
The regs I think tell me that I can refer an RSL if I think they are over accommodated or if the rent appears unreasonably high. If I did this because they are not exempt from the 1996 new rules I would be obliged to pay whatever the LRR comes back at (assuming this is lower than the claim related rent).
Does anyone know if the rent officer determination takes account of the 32% rental element? How should I determine the eligible rent if say the Rent Officer comes back with a LRR for a suitably sized property of say £90 p/w. Does that mean the maximum rent is 32% of this figure.
I can’t imagine that I can use a R/O determination for a whole dwelling when the tenants are only renting 32% of it, or can I?
Would it be better to not refer it and just pay what to me looks like a very high rent for a 32% share

[Anonymous]

It is correct I think to load 100% of the service costs onto the claimant (whether they are reasonable costs is a separate question, but 100% of the reasonable cost I would go along with).

Shared ownership is in effect a long lease under which the claimant pays for any services provided by the landlord, plus rent on a notional share of the accommodation. When the claimants bought the 32% stake, they did not buy the right to receive 32% of future services free. What they bought was a stake in the property, but they will still have to pay for the services they receive.

So I wouldn’t view the rent as unreasonably high purely because it includes the full cost of services. But it sounds as if maybe you aren’t convinced that the service charge is reasonable for what it covers – that is another matter and you would be justified in referring to the RO if you didn’t like the look of it.

[Anonymous]

Sorry to resurrect this but have been trawling the messages for an answer to a query and this looked like Peter was going to answer it but didn’t quite…. 🙂
Part of the query was answered (ie that 100% of the service charges are eligible) but the bit I’m interested in is whether, if the [i:f3d930b61e]rent[/i:f3d930b61e] part was referred, it would be compared to 32% of a comparable maximum rent or compared to 100% of it.
I would have thought the fair comparison was 100% but have come across a L.A. that disagrees. Any answers please? thanks

[Anonymous]

Sorry to resurrect this but have been trawling the messages for an answer to a query and this looked like Peter was going to answer it but didn’t quite…. 🙂
Part of the query was answered (ie that 100% of the service charges are eligible) but the bit I’m interested in is whether, if the [i:e6f35bfdf7]rent[/i:e6f35bfdf7] part was referred, it would be compared to 32% of a comparable maximum rent or compared to 100% of it.
I would have thought the fair comparison was 100% but have come across a L.A. that disagrees. Any answers please? thanks

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