'Raffle Property' stunts risk contravening gambling legislation

An attempt to raffle a property - like the much-publicised case of an owner in south east London, which reached some national newspapers yesterday - could unwittingly fall foul of gambling legislation, Estate Agent Today has discovered.

Yesterday there was much attention given to the website Homeraffler.com, which carries details of a five bedroom property in a conservation area at Blackheath in London. Different national newspaper reports put the value of the home at between £1.25m and £1.3m.

The owner is selling £5 raffle tickets and details on the website include the wish to sell 750,000 tickets “to include our cost [sic] such as PayPal, administration and legal fees.”  

If 750,000 tickets were sold at £5 a piece, the total would be £3.75m.

The property includes bedroom furniture, kitchen appliances, leather sofas, a dining table and “£12,000 worth of lead crystal chandeliers.”

This property raffle also includes a question regarding London parks which entrants must answer - but without such a 'skills' element, the Gambling Commission warns such stunts would fall foul of the law.

“The position is very clear” says a spokeswoman. Under the 2005 Gambling Act there are two possibilities open for the organisation of such an event as raffling a home.

Firstly a home-owner could run a raffle based purely on the luck-of-the-draw, providing he or she obtains a Gambling Commission licence. However, such events cannot be run for private gain and cannot offer a prize valued above £200,000.

Secondly it is possible to hold a competition to dispose of a highly valuable prize such as a property but this needs to be convincingly “skills-based” rather than involve the random drawing of a ticket requiring nothing more than chance.

In 2008 the owner of an 11.5 acre estate in Devon staged a competition after failing to sell his property in the conventional way. The owner succeeded in covering the market price of the estate by selling competition entries at £25 a time.

The competition had a skills-based element with a question - "What is the cost of an adult full-season coarse fishing licence for 2008/2009?" - as well as entrants paying a fee.

The Blackheath property now going to raffle appears to conform with this ‘competition’ element.