The home was sold to a buyer who had shown interest at the 2011 sale.
"It's quite the jewel," Ms Martelli said.
It featured "storybook charm" and interiors "beautifully crafted to uncompromising standards", according to the original listing.
"Washed in soft sunlight its large deck area with beautiful verandas is the perfect spot to unwind and immerse yourself in the view. Or perhaps rejuvenate in the spa overlooking the private, tranquil surroundings and beautiful landscaped gardens that meander down to the sandy beach."
Perfect for entertaining family and friends in "relaxed sophistication", the property also features its own jetty.
"This is a lifestyle we all dream of owning ... once here you will never want to leave."
The ritzy waterfront palace is a far cry from the cheapest property in Rotorua last year - a humble Lake Rotoma home which sold for a pinch at $52,000.
The 65sq m property sold for $109,000 below its CV on May 8.
Meanwhile, the cheapest Bay of Plenty property - in Murupara - sold for a mere $20,000.
It was also the cheapest property sold nationwide last year.
Located on Old State Highway 38, the 87sq m home sold for $13,000 below its CV on March 7.
Real Estate Institute of New Zealand figures show 974 properties sold in Rotorua last year, setting an annual median sale price of $235,000.
Nationally, the most expensive home sold last year was a $9.1 million beachfront property on the North Shore in Auckland that went for $1.6 million over its valuation.
PropertyIQ research director Jonno Ingerson said some yet-to-settle sales could still make the 2012 list.
By the numbers
Cheapest property: SH38 Murupara, sold for $20,000
Most expensive property: Acacia Rd, Lake Okareka, sold for $2.05m
