House raffles: When your home is literally just the ticket

Billboards popped up across Co Kerry this summer offering passers-by the chance to win their "dream home" in Killarney. The posters were seductive for tens of thousands of staycationers criss-crossing the suddenly sun-kissed county, not to mention locals who may actually be in desperate need of a home to call their own.

The house joins others in Cork, Waterford, Dublin, Sligo and elsewhere on an increasingly long list of properties being raffled for profit and for charity. However, while house raffles may be on the rise, they are not without their downsides for those either buying or selling the tickets.

Last summer, Michele Hallahan read an article in The Irish Times about a postcard-pretty cottage near Foxford in Co Mayo being raffled to raise money for frontline healthcare workers in the middle of a pandemic. Without thinking too much about it, she bought five tickets at a cost of €50. Within six weeks she was being handed the keys to her new house.

While the house was valued at close to €100,000, the raffle generated more than €1 million in ticket sales with Hallahan’s number coming out of the virtual drum.

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“I couldn’t get to the house for six months but I have had a couple of lovely weeks there,” she says. “The cottage is at the end of a track and it is such a gorgeous getaway from Dublin. It is absolutely quiet and I am right beside a river. It is idyllic but I’d miss the human company so I go for five days or seven at a stretch. I love being around people so I don’t think I would relocate.”

While Hallahan won big, sometimes those on the other side of the raffle win even bigger. Late last year, Mark and Lucy Keoghan decided to raffle their 300-year-old limestone house in Kilkenny. Mark is a Kilkenny native but the couple are based in the UK.

They priced their tickets at £5 (€5.84) and set a limit of 130,000 tickets and committed to having the draw by the end of January. By January 6th, all the tickets were gone allowing the draw to take place three weeks ahead of schedule.

The raffle effectively meant the couple sold their home for €760,000, substantially more than the price they would have achieved by putting it on the market in the traditional way.

The company which hosted the raffle took 10 per cent commission while 5 per cent went to children’s cancer charities which had supported the couple after their daughter was diagnosed with leukaemia early in 2020.

Social media

“I’d highly recommend it but it was a lot of work,” Keoghan says. “People go into it blind and think all they have to do is post a few pictures on social media and the tickets will sell. They won’t. It does take over your life for the length of the raffle.”

He says another mistake people make is pricing tickets too high. “I have no problem parting with a fiver or a tenner but do I want to spend 50 quid on a ticket?”

According to Keoghan, once the raffle was won, the handover process became more traditional. “It was slow,” he said, pointing out the process was new to solicitors here. Even straightforward questions as to how to assess the stamp duty had to be clarified. Was stamp duty paid on the price of the ticket or the value of the house?

It is on the value to the house but the question was irrelevant to the winner as Keoghan paid the stamp duty and the legal fees for the winner – an added inducement to encourage more ticket sales.

While Keoghan’s raffle “went like a dream”, many such raffles, particularly in the UK where the market for house raffles is more advanced than here, do not work out as either the organisers or those who buy tickets hope.

According to British consumer watchdog Which? very few properties there actually end up in the hands of the ticket buyer and an absence of regulations of the sector mean people can be short-changed. It has warned that the vast majority of property raffles have either been shut down for failing to comply with gambling laws, or have awarded a cash prize after failing to sell enough tickets to cover the value of the property.

The Competition and Consumer Protection Commission (CCPC) here says it has received a “very limited number of contacts to its helpline relating to house raffles”.

A spokeswoman says consumers have complained “that some raffles had been delayed as not enough tickets have been sold”.

She adds that the CCPC encourages consumers “to do some research before they buy these types of raffle tickets to see if the seller is a trader/company, is a consumer or if they hold the necessary licence or permit from the Department of Justice. It is also important to read the terms and conditions of the raffle before they buy so they know what they are signing up to.”

Stelios Kounou is the managing director of rafall.com, the online platform that hosted the Kilkenny draw, and says his business works for "both sides of the transaction".

Ticket sales

It hosts the raffle and processes payments. It also holds on to the money “to ensure [organisers] have no control or influence over the draw and to ensure they don’t access any of the money until the winners are confirmed”.

The platform has been operating in the UK for six years, but has only gained traction here over the past 12 months. Since then, six Irish houses have been successfully raffled on it.

If a house raffle succeeds, the homeowner gets 90 per cent of the ticket sales, he says, while the platform keeps 10 per cent. If, however, not enough raffle tickets are sold to reach a threshold set by the organiser before the process starts, then the house is withdrawn as the prize and the eventual winner gets 90 per cent of whatever money has been raised in ticket sales instead with 10 per cent going to the platform. The homeowner gets no money from the process but they do still own the house.

He warns people considering going down the raffle route as an alternative to disposing of a house using more traditional avenues that the process is not easy.

“A lot of people don’t understand how much work and time and effort is involved in holding one of these competitions. It is tiring and a full-time job for the duration of the raffle. People have to be on all the social media channels and constantly uploading content.”

He points out that people who buy a ticket have much better odds of winning compared to the Lotto “because the platform ensures there has to be a finite amount of tickets so entrants know the minimum odds and as soon as you get a ticket can see the full list of entrants”.

Back in Kerry, the "dream house" is being raffled by the Boherbue National School to raise funds for a general purpose room.

Marie Casey is the principal and she recognises "there are a lot of draws out there and we wanted to have a unique selling point to ours, so the teachers and I set aside €50,000-€60,000 for prizes to give away each month".

In June, the school gave away, among other things, a €10,000 cash prize, in July €5,000 cash and a holiday, and at the end of August it will be a tech bundle consisting of a laptop, desktop, tablet and printer.

The big draw will be on December 31st, with two local companies sponsoring additional prizes on the night. “Everyone will be interested to know that they have a higher chance of winning something, even if it’s not the house. For those struggling on the property market, it’s a dream come true.”

But how did a national school in a small village in Cork manage to get a semi-detached house worth €350,000 to raffle?

They bought it.

The school secured a loan and went through Cork District Court to secure a lottery licence. Furniture and hardware companies helped decorate the house, as a way to show support for the school.

To break even, they need to sell 4,500 tickets at €100 each to cover the legal fees, advertising and promotion. They aim to sell about 10,000 tickets by December and, according to Casey, they have sold about 3,500 already. “It’ll cost us about €125,000 to build that room. Any other money we make, we’d love to upgrade other parts of the school for the children too.”