Agreed, allowing withdrawals with no penalties will simply allow players to troll bids or rig their bids to help their friends eg. mass bidding on a plot to give the illusion that there's a lot of competition only to withdraw their bids near the end, hence allowing their friend to sneak their win with zero competitors.

As I've said, there has to be some sort of deterrent and I feel that the 20% of plot price is a decent one since it's not a negligible amount but still lower than the 50% penalty if you win a bid but choose not to accept it.