The Press reported this morning:
The Redwood home could be yours for a little more than $100, despite its rating value of $594,000.
The most the lucky buyer will pay is $1100.
Real estate agent Brad Maxwell and wife Janice own the Redwood property through a family trust and are selling it through a new sales method they hope will catch on.
Would-be buyers will book a seat at an internet auction for $100 each, with the lowest unique bid between 1c and $1000 getting the house.
The Maxwells have ensured they will not lose out on the deal. They have calculated that selling between 5000 and 6000 seats will bring in what they want for their home, and only then will the online auction run.
The DIA pointed out, this was illegal in several ways:
Despard said under the Gambling Act 2003 the auction was illegal in several ways.
“There is a huge element of chance in this so-called auction in which people pay to participate,” Despard said.
“It is also online gambling, which the Act defines as ‘remote interactive gambling’.”
Gambling with prizes exceeding $500 can only be conducted by societies raising money for authorised charitable purposes, she added. But this sales scheme was being conducted by a private person for personal profit and could not be licensed.
“Participating in illegal gambling is a criminal offence,” said Despard.
Furthermore, any sale and purchase agreement stemming from the auction would be on shaky ground because the Gambling Act says contracts relating to illegal gambling are illegal for the purposes of the Illegal Contracts Act.
Internal Affairs had advised the Trade Me and Premier Realty that the proposed sales method was illegal and was also contacting the Real Estate Institute of New Zealand.
DIA do a good job in educating people on the law. They’ve given me some helpful advice from time to time.
Having said that, our gaming laws are very restrictive and it would be great if the Government reviewed them with an eye towards permitting more gaming, so long as there is adequate transparency around the games.
I have problems with the TAB having a monopoly over sports betting, and the restrictions on online gaming which are more onerous than Australia.
But these are issues for the Government and ultimately Parliament.