Every time I glance over these stories, I always say to myself that one day when I have a few minutes, I’m going to read these as they just sound too good to be true don’t they?!
If I could get a house for £5, imagine how many I could buy in a year…
The yields would be out of this world…
I’d never have to work again…
Definitely too good to be true, I’ll just read it another time…
Well today was the day!
Looking into this in closer detail a lady named Marie won a £845,000 manor house in Lancashire, tickets were being raffled for £2 each so she bought herself 20 and won not only the house but the title of Lady Melling of Melling Mannor.
There have been a few stories in the past few months of similar types of raffles in London, but as far as I can see none have been successful as yet.
A company has capitalised on this recently and describe themselves as “the UK’s first property competition platform”
It is legal to run a competition for profit as long as there is a level of skill demonstrated by participants so they must answer a question correctly in order to enter the raffle. The question however cannot be deemed as too easy, as if not conducted in accordance with The Gambling Commission rules sellers can land themselves in trouble with the law.
The seller must achieve enough ticket sales to cover the value of their home, otherwise a cash prize will be offered instead, the fee charged is 5% + VAT if the sale price is achieved however they “aim to sell for a little more than open market value”.
This would obviously appeal to buyers as the prospect of buying a house for a price that can be likened to the cost of a “Triple, Venti, Half Sweet, Non-Fat, Caramel Macchiato” is a dream come true but what’s in it for the sellers?
They end up paying more that they normally would in standard estate agency fees and would not benefit from the local expertise, in-depth knowledge, help and support that a good estate provides as part of their daily role.
From what I can gather the sellers who have successfully sold by using this process, have used this as a last resort after failing to sell through traditional methods. I think the prospect of having thousands of people purchasing tickets to buy their homes is appealing however based on London prices, is it that appealing?
Based on an achieved sale price of £600,000 with a fee of 5% not including VAT, that would be an astronomical fee of £30,000 (not including VAT).
Do you think this will catch on?
I asked a similar question in a previous blog I wrote Online estate agency vs traditional estate agency
Having worked in estate agency, I have always believed in the value of a knowledgeable estate agent, who knows the market, the neighbours, the schools and amenities. Someone who is passionate about property and people and sees the value in what they do, I know that my clients feel the same.
So after reading this, if a role in property appeals to you, or you are already in property and would like to have a chat about your next steps, please do get in touch.
I look forward to hearing your thoughts?