Public house to private home

The gloomy predictions for pub closures over the next few years will highlight the fact that it is still difficult to "de-license" a pub.

I don't mean giving up the premises licence. That is already provided for under section 28 of the Licensing Act 2003. As long as you are named as the actual holder of the premises licence you can send it back to the licensing authority with a note that you wish to give it up. You cannot, of course, simply send back the licence in your possession if the brewery or operating company are the actual holders.

But several freehold owners have recently contacted me to ask what the procedure is for giving up the business but staying in the pub as a private house. This is where the problems can arise.

It is not simply a question of telling the local authority. You have to convince the planning department that a change of use is necessary - from commercial to residential. This is where both local and national policies come into play. There has to be abundant proof that the premises are unviable as a public house and will remain so in the future.

The fact that you have decided to retire from the trade is not necessarily enough. They may counter with the proposal that another owner will revive and restore the business and that because of the pub's location it is inappropriate to remove it from the commercial category at this time.

There is also the question of rates. Where a business is not trading, some rates relief can be obtained, but again it is not possible to switch to the residential tariff as of right.

All this time, of course, a valuable property for you has, in effect, no value: you do not want to sell it to someone else and you will not get such a good price if the place is closed anyway. Your capital is tied up.

If you could advertise it with a change of use to residential, it would probably be worth far more on the current market, especially if it is in a desirable location, perhaps in the centre of an attractive village.

All this means that you need to plan things carefully and certainly consult an experienced adviser on property matters so that you know how to embark on the planning application. You should be prepared for a long and frustrating wait.