England and Wales Lands Tribunal

 


London Borough of Newham, Re Marlow Road [2006] EWLands ACQ_02_2005 (28 February 2006)

ACQ/2/2005

LANDS TRIBUNAL ACT 1949

COMPENSATION – compulsory purchase – dwellinghouse in poor condition – value in good condition – cost of necessary repairs – allowance for profit – compensation awarded £57,500

IN THE MATTER OF A NOTICE OF REFERENCE

B Y LONDON BOROUGH OF NEWHAM Applicant

(No Respondent)

Re: 37 Marlow Road

London E6 3QG

Before: N J Rose FRICS

Sitting at Procession House, 110 New Bridge Street, London EC4V 6JL

on 21 February 2006

Anna Eastgate, solicitor, for the applicant

DECISION

1. This is a reference by the London Borough of Newham ("the applicant") to determine the amount of compensation payable for the freehold interest in a dwellinghouse known as 37 Marlow Road, London, E6 3QG ("the subject property"). That property was compulsorily acquired under the Newham (37 Marlow Road, London, E6) Compulsory Purchase Order 2000, which was made pursuant to section 17 of the Housing Act 1985 on 29 March 2000 and confirmed by the Secretary of State for the Environment, Transport and the Regions on 23 June 2000. A general vesting declaration was made on 21 February 2001 and the subject property was vested in the applicant on 22 March 2001, which is the valuation date.
2. The title to the subject property is not registered. It has been vacant for a long time and, despite various attempts to do so, the applicant has been unable to communicate with the owner. The applicant therefore referred the question of compensation to this Tribunal on 24 December 2004. Ms Anna Eastgate, solicitor, appeared for the applicant. She called one expert witness, Mr David Drane, MRICS, employed by the London District Valuer's Department of the Valuation Office Agency.
3. From the evidence I find the following facts. The subject property is a mid-terrace house with a slate roof, built in about 1885. It is situated off the A117 High Street South, in an established residential area quite close to East Ham underground railway station. The building is arranged on two storeys, with a single storey bay to the front and a single storey back addition. At the valuation date the accommodation comprised two reception rooms on the ground floor, kitchen and wc in the back addition and two bedrooms on the first floor. The property was generally in a fairly poor condition and required extensive repair and refurbishment to bring it up to mortgageable standard. The roof coverings required overhaul and replacement/installation of cement fillets and flashings. The back addition roof (although re-covered) had deflected and the timbers required strengthening. The guttering and down pipes required replacement. The window joinery throughout was poor. There were cracked and crumbling sills. The chimney stack required refurbishment. The property required re-wiring and some replacement of plumbing. Re-plastering was needed in various places. Interior and exterior decoration was required, including re-pointing brickwork.
4. Mr Drane considered that, in view of its condition, the subject property would have appealed to a limited market, and most likely be bought by a small builder/developer who would pay cash and seek to put the property into good repair and re-sell it at a profit. He referred to three other houses in Marlow Road, of similar size to the subject property, which had been sold between July 2000 and March 2002 in a reasonable state of repair. The prices paid ranged from £93,000 to £120,000.
5. In the light of this evidence, and his general experience of property values in the area, Mr Drane considered that, at the valuation date, the subject property would have been worth approximately £105,000 if the necessary works of repair and refurbishment had been completed at an estimated cost of £35,000. Mr Drane made allowance for the latter expenditure, and a further £12,500 for profit and risk, and arrived at a valuation of £57,500 for the freehold interest with vacant possession.
6. I formed the view that Mr Drane was a fair witness and I accept his evidence. I therefore determine that the compensation payable for the freehold interest in the subject property is £57,500. There being no respondent to these proceedings, I make no order as to costs.

Dated 28 February 2006

N J Rose FRICS