Housing minister says he will ‘look into’ dangers of ‘impulse’ buys with online bidding for homes
Irish Housing Minister James Browne is investigating the potential psychological risks of online home bidding, citing concerns that it encourages impulsive behavior similar to gambling. An ESRI report suggests that competitive online platforms can lead to higher prices and increased financial risk for buyers.
Why it matters
Regulating digital marketplaces is becoming increasingly important as consumer behavior shifts toward high-stakes online transactions.
THE HOUSING MINISTER has said he will “look into” the dangers of “impulse” buying that could be associated with online bidding for homes.
Speaking from the Fianna Fáil think-in in Tullamore, Co Offaly, James Browne remarked that with online bidding, people could make offers at “three in the morning that they might, in the cold light of day, not put themselves into”.
An ESRI report in February found that people using online bidding platforms to buy homes are far more likely to bid higher and take greater financial risks in buying homes.
While the study found there was a perception of “fairness” with online auctions, online bidding platforms saw prices jump by as much as €16,000.
The ESRI pointed to theories on “auction fever” and “loss aversion”, which suggest that competitive environments drive individuals to try to beat others.
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