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A couple trying to kickstart a unique method of auctioning super-cheap homes are refusing to give up after a warning that it would be illegal.
Real estate agent Brad Maxwell and wife Janice had been planning to test the new internet auction format by selling their Christchurch house, valued at $594,000, for no more than $1100.
Potential buyers would pay $100 for a "seat" in the auction, and when enough were signed up to make it economical, bids would be taken.
Mr Maxwell said it was a "genuine auction" that could make buying a house affordable for many.
But the country's gambling watchdog, the Department of Internal Affairs, has poured cold water on the idea.
Under gambling laws, it was illegal on several grounds, said department gambling compliance manager Debbie Despard. "There is a huge element of chance in this so-called auction in which people pay to participate.
"It is also online gambling, which the [Gambling] act defines as 'remote interactive gambling'. Gambling with prizes exceeding $500 can only be conducted by societies raising money for authorised charitable purposes, but this sales scheme is conducted by a private person for personal profit and cannot be licensed by the department."
Mr Maxwell said the Internal Affairs stance would not kill his idea. If it needed tweaking, he was happy to work with officials on that.
He said if he were forced to shut down the auction, he would. "But what I would really like is an opportunity to work with the [department] to see how we may modify the system."
Mr Maxwell said he had received huge support since his idea went public yesterday. People had offered about $20 million worth of real estate for sale in online auctions.
Ms Despard warned that participating in illegal gambling was a criminal offence, and any agreement would be on "shaky ground".
