Freehold is the term used as shorthand for the tenure of an estate in land which exists in "fee simple absolute in possession" and identifies the ultimate owner of a property. Such ownership usually includes not only the surface land or building, but also the sub surface of a property and all the air space above. As part of the aim of simplifying the conveyancing process, the Law of Property Act 1925 set out two estates or interests in land, namely the "fee simple absolute in possession" or 'freehold' and the "term of years certain" or 'leasehold'.

Buying a Pub: Private Treaty

This is the most common form of buying / selling a property and essentially involves a binding private contract for sale to be drawn up between the parties. A sale of a property or investment opportunity by "private treaty" allows the vendor a much greater degree of control over the actual sale process and any specific conditions that should apply. However, unlike a sale by auction, the actual completion of the sale can take considerably longer to achieve.

A commercial property agent is usually appointed to manage the disposal process and a marketing strategy and marketing budget should be agreed with the vendor, to meet the client's particular requirements. The estate agent's fee is usually based on a percentage of the sale proceeds achieved and tends to be in the region of between 1% to 2.5%. This will usually be exclusive of VAT and disbursements, and legal costs.

Buying a Freehold Pub: Purchase Costs

With property acquisitions, a prospective purchaser will normally incur "acquisition" or "purchase costs" in addition to the actual purchase price. These costs are essentially legal and surveyor's fees, VAT and stamp duty. The level of these costs will vary depending on each particular property, the nature of the client/surveyor relationship and any changes in the rate of Stamp Duty imposed by the Exchequer.

At present the purchaser of a property sold with a purchase price in excess of £500,000 could expect to have a combined acquisition cost equivalent to about 5.75% of the purchase price. A prospective purchaser may have additional costs of acquisition arising from a building survey or environmental survey.

Buying a Pub: Stamp Duty

This is a Government fixed tax, chargeable on the execution of documents, pertaining to transactions such as Leases, Agreements for Leases and Conveyances. The duty is payable by the purchaser or lessee, and the disposal document can not be adduced as evidence of the transaction unless adequately stamped. The rate applicable is set by Central Government and varies depending upon the value of the transaction

Buying a Pub: Building Surveys

A building survey is an examination of a building by a surveyor (which may include specific tests by the surveyor or other experts) in order to produce a report on the structural integrity of a building and the state of repair.Such a report would usually cover the condition of the structure, incidence of any defects to the fabric of the building and the state of repair of fixtures and fittings, services and plant installations.

Depending upon the instructions given to the surveyor; these physical features would also be described in relation to safety, stability, strength, efficiency and economy in use, ease of maintenance and other factors as required.A building survey is often required as a condition to the grant of a mortgage or loan secured against the value of a pub or licensed property.

Buying a Pub: Local Authority Searches

A local authority search is essentially an application for an official search of the Local Authority's records, for written confirmation or a certificate disclosing matters or encumbrances affecting the land. Where a lease is being granted or conveyancing takes place, a local authority search should be undertaken.