This was fatal, and exposed the model’s flaws, considered in the decision: “The Parthenia model is a clock which strikes 13… If a clock strikes 13 it is broken… It cannot be relied upon as a reliable means of telling the time even when it strikes an hour, such as 11 or 12, which are possible times of day.” Unfortunately for the lessees, in Trustees of the Sloane Stanley Estate v Mundy, the Parthenia model resulted in a ‘no Act’ figure for one of the flats which was higher than the actual value of the existing lease with 1993 Act rights. However, aside from Kosta, it has remained untested in any court or tribunal capable of setting a judicial precedent. That model has been particularly popular with leaseholders, because it results in a much higher relativity (and hence, lower premiums). The difficulty is that the short lease value must be arrived at on the assumption the 1993 Act confers no right to a new lease.Ī number of graphs claiming to show relativity have been produced by valuers over the years and applied by the Leasehold Valuation Tribunal/First Tier Tribunal and Upper Tribunal (UT), but they are far from perfect, and disputes about remain.Įnter Dr Bracke, who used a statistical model known as hedonic regression to analyse data of actual sales between 19. The greater the difference, the greater the marriage value. That difference is sometimes expressed as a percentage, known as ‘relativity’.

Hedonic regression