Use a Raffle to Sell Your Home?

Posted on September 26th, 2008 by Al Lorenz

The latest tactic in the now slower real estate market it to use a raffle to sell a home.  For a $300,000 home, you would only have to sell 3000 tickets at $100 each to get it sold!

Many states regulate raffles under gambling laws.  Raffles for homes or properties are illegal unless the homeowner has a nonprofit organization as a partner, and the homeowner cannot make more than the appraised value of the house. (Some states, including New York, forbid even nonprofits from raffling off a home.)  So, with the marketing involved and working with a non-profit, a raffle is not an easy way to sell a home.

However, the process does have its fans.  Below is an excerpt from a New York Times article on how a couple sold their home by raffle:

Ms. Crawford came up with a novel strategy: she would hold a raffle. Tickets would go for $100 each, and one lucky person would win the farmhouse. If they could sell enough tickets, they could walk away debt-free.

Last December, the couple teamed with a real estate agent and a local charity and set about publicizing the raffle, posting flyers and calling news outlets. By the time the drawing was held at a local country club this past March, they had sold almost 6,500 tickets, raising enough money to cover the cost of the house along with a surplus of more than $200,000 that went to the charity. – NY Times

The process has the added benefit of not requiring any financing for the new buyer, if they can pay the excise and other taxes.  The way the finance market is going, that may be the biggest benefit of all!

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Tags: General Interest, Marketing // 1 Comment »

One Response to “Use a Raffle to Sell Your Home?”

  1. sergreene // Sep 27, 2008 at 12:55 pm

    This method for selling houses isn’t so new; people have been doing it for quite some time, it is just now taking center stage because of the housing market. In the state of California it is wide spread and commonly known. With the advent home raffle listing and help sites like usaHomeRaffle.com, raffling a house could be as common as the selling through today’s traditional methods and a major boost to the economy.

    Just think about it. Not only does someone win a house; but someone else finally gets to move. A charity gets to make a lot of money and affordable mortgages are created (to pay tax liabilities if you don’t have a ton of cash sitting around). That sounds to me like home raffles are just what this economy needs; people to start spending cash and moving money.

    Any thoughts anyone?

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