A Christchurch real estate agent has begun refunding people who bought tickets to an online house auction that has been deemed illegal.
Would-be buyers paid $100 to take part in the auction, with the house going to the lowest bid between 1 cent and $1000.
However, the Department of Internal Affairs says the auction is illegal under the 2003 Gambling Act.
The department says the auction is classed as remote interactive gambling and is therefore illegal. Gambling with prizes exceeding $500 can be conducted only by societies raising money for charity.
The Trade Me and Premier Realty websites have been told the auction is illegal, and the Real Estate Institute of New Zealand is being contacted, the department says.
Real estate agent Brad Maxwell says there has been huge public support for the auction and he is determined to develop a legitimate version.
Mr Maxwell says the four-bedroom house - which is valued at $594,000 - will be sold by conventional means.