Fleurets warns sellers of dip

In a frank assessment of the market, Fleurets has warned sellers that they will have to expect less for their business this year than in 2007, in line with the residential markets.

Simon Hall, the agency director, said that the combined effects of the credit crunch, smoking ban and a downturn in trading levels call for an adjustment of sellers' expectations.

He said: "People need to come to terms with the fact that it's a different market now. If you look at the current economic and pub landscape, it is very different to a year ago.

"It has been a tough six to nine months and the consensus seems to be that it is going to remain tough for a while longer - but we can't start talking about the percentage drop because not enough deals have gone through yet to enable any sensible statistical analysis."

Several licensed property valuation firms are rumoured to have reduced previous valuations by up to 10% and a national pubco is said to have reduced its current offers by a similar figure.

Hall said: "The problem is that we won't know quite where the new level is until we start seeing higher volumes of transactions that will set the new level."

Fleurets believe that operators looking to buy sites have held off while they wait for a realignment of the market and a wider choice of available opportunities.

Hall predicts a significant "bounce" when the market finds its new level, as operators step in to snap up the best sites before others beat them to it.

He said: "It may be that this point is not too far away, as a number of operators I have spoken to are starting to talk more positively about trading conditions and the future prospects."