They seem like the perfect solution to a seemingly insurmountable problem – but many house raffles are proving far from straightforward.

In a property market that all but ground to a halt last year, the ‘win a home’ competition appeared to be an innovative way of getting things moving again.

But the complexities of the law means that several such schemes have been stopped in their tracks by the Gambling Commission.

A competition to win a £500,000 dream house in Horsforth has just been re-launched after it had to be redrawn after falling foul of the gambling laws.

And with house raffles springing up all over the country it is not the first that had to go back to the drawing board.

It’s not altogether surprising that people have fallen foul of the law when the rules governing house competitions are so complex.

Crucially in the Horsforth case, as in others, those entering the competition did not have to pay their £20 until they had successfully answered the multiple choice questions.

Organisers have now had to change that part of the competition so that the questions have to be answered after the money has been paid – turning it into a game of skill rather than mere chance.

There is also debate about the type of questions asked.

While those raffling the houses clearly would not want to set the barrier too high, the law dictates that the questions should not be too easy.

As a growing number of householders have resorted to competitions in a bid to ‘sell’ their homes, the Gambling Commission has been keeping a close eye on developments, and has warned organisers to take note of its guidance and to take independent legal advice.

It has warned homeowners that they could potentially fall foul of the 2005 Gambling Act.

“Lotteries are the preserve of good causes and cannot be operated for private gain,” said the commission’s deputy chief executive, Tom Kavanagh.

“Prize competitions are free of statutory control under the Gambling Act and can be run for profit but homeowners considering such schemes as an alternative to selling their house risk committing a criminal offence if they cross the boundary and stray into offering an illegal lottery.

“We already have questions over the legality of a small number of existing schemes and are in contact with the organisers.”

The commission said it was aware of a number of schemes that were intended to act as prize competitions in line with the Gambling Act, and it has written to some of the organisers to question whether the skill, judgement or knowledge is sufficient to meet the requirements of the Act.

In a statement it says: “The letters request information from the operators in order to assess whether the scheme does amount to a genuine prize competition, or whether it fails to meet the requirements of the Act and is, in reality, a lottery. We have also advised such operators to seek legal advice before commencing or continuing and where they cannot assure themselves of the legality of what they are doing; to cease activity and return monies already taken.

“Other homeowners considering such schemes are warned that promoting a lottery without an operating licence is an offence under the Gambling Act 2005. The Commission advises individuals considering or operating a scheme to consider the guidance published on our website and to take independent legal advice before proceeding.”

The growing trend has prompted a warning from the Law Society which responded towards the end of last year to concerns among solicitors. The society has issued a practice note warning that the method of selling exposes solicitors to breaches of gambling legislation, fraud and money laundering.

Law Society president Paul Marsh said: “There are significant risks to this method of selling, not just to sellers and buyers, but to the solicitors involved in the transactions. Our practice note highlights these risks and offers sound advice to our members on how to identify and safeguard against them.

“Currently, there are a small number of homeowners looking into this method of selling but, judging by the rise in queries from solicitors to our practice advice service about these kind of transactions, and the slowing in the market of the more traditional methods of selling a home, we could see more attempts at these competition-style sales.

“The latest in our growing range of helpful practice notes gives the profession a head start should there be further attempts at this method of selling a property.”

With warnings from the Law Society itself, it’s no wonder that those of us without legal training could well find the whole issue a legal minefield.

In the case of the Horsforth house the problem lay with how it was formatted.

Because the competition needed to be seen as a game of skill in order to comply with the law, all those taking part had to give correct answers to three questions. But they were allowed to keep trying until they got the answers right – and only then were they charged the £20 fee.

Organiser Jonathan Sammon said the competition had now been changed to meet the requirements of the gambling laws – this time they have to pay before they answer the questions.

Mr Sammon said they had taken legal advice and advice from the Gambling Commission to ensure the competition was valid.

He is far from being the only person to fall foul of the Gambling Commission rules. Nevertheless, some house ‘raffles’ are going ahead without having run into problems.

For a fee of £99, contestants have been invited to win a house in Addingham, in the winafabpad.com competition.

Although the initial outlay is quite high, relatively speaking, organisers will only accept 3,000 entries, so they say the chances of winning are fairly impressive.

Once the 3,000 figure has been reached the plan is then to put any further entries into a draw for another house in Farsley.

Sam Makin, who owns the Addingham property, said: “It is going well. The entries are steadily coming in, and it is just a matter of time now. We have extended the deadline to July. We have been in contact with the Gambling Commission, and they have said that everything we are doing so far is fine.”

Crucially anyone entering the Addingham competition has to submit their £99 with the answer to the question – and if the answer is wrong they will lose their money.

“I think the questions have to be quite hard,” she said. “It needs to be a proper question that people need to think about.”

She added: “To our knowledge, everything that we are doing at the moment is fine.”