Fleurets: leasehold market still buoyant

The leasehold market remains buoyant despite the vast number of managed house conversions, according to the Fleurets annual

survey. The statistics are based on pubs sold by the agent between 1 October 2005 and 30 September 2006.

Fleurets chairman Barry Gillham said: "Despite the vast number of managed house conversions to leaseholds flooding the market, prices have not dropped."

Leasehold prices have risen by 0.7% on last year, with multiples up by 3.7%. The average value of a leasehold in the south of England has risen from £83,821 in 2004 to £111,324 in 2006.

Bottom-end pubs - pubs sold by Fleurets with no accounts - have also risen in value over the past two years. Average prices in the midlands have risen from £166,229 in 2004 to £272,636 in 2006.

"The fact that bottom-end prices have risen reflects the strength of the market. It is not only bottom-end pubs that are being purchased for alternative use - some of these outlets are selling for upwards of £300,000," added Gillham.

Freehold prices have also risen in many parts of the country.

"Prices are generally up across the board. Typical of these changes were freehold prices up 11.5% on last year and multiples up by 15%.

"Though there were a couple of regions where this wasn't the case," he said.

Gillham said he was most surprised by the lower figures in the north west and in the midlands.

He reported very few freehold freehouse sales in the north west, with prices remaining around the £500,000 mark. Leasehold prices in the north west returned to a steady average of £50,000 after one year of exceptional sales.

Leasehold prices in the midlands were the second lowest in the country with an average price of £77,000.

Gillham said: "I think these statistics are down to the fact that we didn't sell many pubs in these areas over the past year. This is probably because there are many regional brewers in the north west and in the midlands."