As the world economy lurches from one crushing disaster to another, and house prices continue to slide, UK homeowners are resorting to unconventional selling methods. They have given up on securing their (admittedly ambitious) asking prices via the usual routes, and are raffling off their homes instead.
I’ve come across three house raffles this week. The first home is rather swanky; it was featured on Channel 4’s Grand Designs, which is the Holy Grail for housebuilders.
It’s a three bedroom house in Cheltenham (very la-di-da!) and is a memorable Grand Design because most of it was built underground. If I remember rightly, there were problems getting planning permission for a large structure more than two storeys high – so the couple who owned the site decided to dig down instead. It’s eco-friendly, too: exceptional cunning means that the underground part is lit by natural sunlight, and the home heating comes via a ground source heat pump (don’t ask me how it works). More here.
The owners haven’t been able to find a buyer for the property, which is currently retailing at £845,000 ($1.6 million), so they have launched an online raffle, which will be drawn in the New Year. Tickets are £25 apiece To enter online, visit the official website.
Here’s the second one:
This £650,000 home (that’s around $1.2 million!) is in Ingleby Barwick, a large residential estate in Teeside. The couple who bought it from the developers couldn’t afford the mortgage repayments; they put it up for sale but couldn’t find a buyer. It’s an increasingly common situation, summarised as:
Overpriced New Build + Unaffordable Mortgage + Credit Crunch = Sign of the Times
However lovely their home is, it’s worth bearing in mind that the average house in that area is a relatively meagre £170,000.
So the enterprising couple are raffling the house on the internet – again, for £25 a ticket.
Of course, the question mark hanging over both raffles is this: what will happen if insufficient tickets are sold? Both couples say that if their reserve prices aren’t met, they will make the draws anyway, with the winners receiving the prize fund.
I’m tempted to enter both these auctions – after all, the odds are better than the National Lottery’s. However, these raffles only work if an awful lot of tickets are sold, and both couples have a long way to go. Right now the raffle for the Cheltenham house, despite being featured in national newspapers, has dispensed just over a tenth of the 46,000 tickets that have to be sold if the draw for the house is to go ahead.
Note: People who run these draws have to be careful, because under English law it’s illegal to run a lottery for personal profit. So these aren’t “raffles” in the strict sense of the word. People must successfully answer general knowledge questions, before they can enter.
Anyway, here’s the third house:
This home in Devon has also been in the newspapers, and is the subject of a forthcoming BBC programme. It’s a five-bedroom home with 9.5 acres of woodland, two-acre fishing lake and four holiday lodges. The retail price? £1 million ($1.8 million). The couple who own this house have now reached their ticket sales target: 46,000. (I’m too late. Sniff.) The draw is expected imminently.
So it can be done! In our current climate, do you think this method of selling homes could take off?
UPDATE: You can read my follow-up to this post here.