Any loyal customers will likely see through those whose prices are so unrealistically low. If a discerning custy gets a quote for, say £2.50 on a £10 house, what sort of job would she expect for that price? And how long would the other guy stay in business when he would have to work 4 times as hard as you just to make the same money?
I really wouldn't worry about it at all if I were you. Why not just concentrate on doing what you do, do it well and keep your customers happy.
I have come across guys canvassing for work, and always try to encourage them, and wish them success in their venture. We all have to make a living, and having a relaxed as opposed to uptight attitude about this will enable you to focus on keeping your business successful, rather than worrying about what others may be doing. Try it, you will be just fine.
John.