Row explodes over house raffle which failed to sell enough tickets

A row has blown up over a house raffle where the property prize was withdrawn and a cash alternative offered because too few tickets had been sold.

According to local media, in Sussex, Fiona Koderisch - the owner of an apartment at Hove in Sussex - has been accused of being a “scammer”because she changed the raffle prize from an £800,000 apartment to £30,000 in cash.

The Argus news website quotes the owner as saying: "My website guy had a problem with the software and some tickets didn't upload property.

"We didn't sell enough tickets and I can't give the house way for 10 per cent of what it is worth. The deal was if there weren't enough tickets sold they would get 80 per cent of the ticket sales after all the costs.

"I can't give away the prize, it is worth a lot of money, my flat. Ten thousand people participated - that is it and we needed to have at least 100,000 people participating.”

The Argus says that the terms and conditions on the raffle stated that if the minimum number of paid entries were not achieved, then the winner would receive a cash payment of 80 per cent of ticket sales, after marketing expenses and a donation to charity - which has already been paid.

The T&Cs said: "If the minimum number of paid entries is not achieved the winner will receive a cash payment of 80 percent of ticket sales after marketing expenses have been deducted, the charity will receive 10 per cent of all ticket sales whether the minimum is achieved or not.”

You can see the news website story in full here.

This is just the latest of many controversies surrounding raffles, which until the recent strong housing market were popular with some sellers.

Last year Shilpa Mathuradas, head of property litigation at London law firm Osborne Law, warned of the pitfalls associated with raffles for both organisers and entrants.

She said: “Property raffles offer the buyer the chance to get a property for a couple of pounds while offering the vendor the chance to get more than the recommended price for their property. This would appear to be a win-win situation, but in reality property raffles are a legal minefield. Many are simply too good to be true.”

She continued: “A minimum number of tickets need to be sold for the vendor to realise their asking price, but when this doesn’t happen, which is often the case, then the winner can be left without the house they were expecting.

“It may be that a cash prize is awarded instead, but this depends on the terms of the raffle. A cash prize may not be a bad return on a few pounds’ investment, but you should remember that winning the property, even if you win the raffle, is not guaranteed.

“It is also important to bear in mind that just because you may have won a property in a raffle doesn’t mean stamp duty doesn’t need to be paid, though that can be included in the price of the lottery. You will also need to think about further costs, such as a lawyer to consider the contract.”