We have an answer - it seems there are people willing to take a punt on Wellington home without first looking inside to check what condition it is in.

The three-bedroom bungalow in coastal Island Bay, with a CV of $630,000, is up for grabs as a mortgagee sale and first attracted media attention last week because of its unusual sale conditions.

Unlike most properties, potential buyers were not allowed inside the 98 The Parade address either for scheduled open home visits or private viewings.

"Absolutely no person is to enter the property," the home's Trade Me listing said.


Despite this, it had still drawn "strong interest", Warrick McCluskey from selling agent Tommy's Real Estate Wellington City said.

Potential buyers had until 2pm today to register their interest, with McCluskey reporting there had been "quite a few tenders" submitted.

"It would be fair to say the nature of the [sale] process hasn't hurt the interest in the property," he said.

Loan Market Auckland mortgage adviser Bruce Patten said "it will be really interesting to see what this house goes for".

It was rare for potential buyers to be barred from viewing properties, but it had been more common between 2009 and 2011 when a raft of mortgagee sales hit the market in the wake of the Global Financial Crisis.

He said people had gone bankrupt and were "so badly financially wound up" at the time that they didn't care what price their property sold for because it wouldn't be enough to cover their debts.

Denize Trustee Company Ltd is the current owner of the Wellington bungalow.

The trust's director is businessman Jonathan Denize, the former owner of the Nosh supermarket franchise which went under last year, owing staff more than $300,000 in wages.


Denize has twice been declared bankrupt.

The Wellington home's CV is significantly cheaper than the median price for Island Bay of $820,000 in May 2018, according to the Real Estate Institute of NZ figures.

A LIM report and council plans and permits can be made available to potential purchasers.

The listing describes the 120sq m house, which has three bedrooms, one bathroom and a garage, as "magnificent" and sitting on a 425sq m section.

But institute chief executive Bindi Norwell warned potential buyers to first take legal advice because mortgagee sales differ from "normal" residential sales".

This can include different contract clauses for mortgagee sales allowing owners to remove fixed items from the house.

Loan Market's Patten said during the GFC there had been "scenarios of mortgagee sales ... where the owners removed all of the wiring, the light fittings, the door handles, the stove".

He expected this risk and the fact potential buyers were not allowed inside to impact the Wellington bungalow's sale price.

When buyers were not allowed inside, they didn't know what condition a home was in - "for all they know, it could be absolutely trashed and ruined inside".

Banks were also less likely to lend to buyers when they hadn't viewed the inside of property or when a valuer hadn't been allowed in to do a valuation.

"We've definitely had scenarios in the past – mainly during the GFC – where ... the bank wouldn't accept a valuer saying, 'I've walked around the property, I looked in the windows but I couldn't get access'," he said.

Banks were largely powerless to stop an owner of a mortgagee sale process from barring viewings without resorting to a messy legal process.

New Zealand Bankers' Association deputy chief executive Antony Buick-Constable said mortgagee sales were always "the last resort for banks".

"It's not in anyone's interests that they occur. Banks work very hard with customers who find themselves in financial difficulty.

"People who are having trouble should speak to their bank as soon as possible."