A Melbourne man is fighting to reverse the sale of his home which was sold for $1,000.

Zhiping Zhou's house in the Melbourne suburb of Braybrook, which he built himself, was seized by the sheriff over a $98,000 debt.

The Victorian Supreme Court heard the property had an estimated value of $630,000.

The reserve was set at market value during an August 2010 auction but was removed by court order after the house failed to sell.

Five months later it was sold for just $1,000.

The second highest bid was $200.

Mr Zhou's lawyer told the court on Thursday the sheriff breached her duty by accepting the successful bid, arguing it was "absurd".

"[The sale is] so short of the mark it's not a real sale," barrister Paul Hayes said.

He said it was hard to imagine lawmakers had intended for people like Mr Zhou to lose out so badly.

The judge was asked to invalidate the sale or award damages.

Action is also being taken against the buyer, Ronald Kousal.

Mr Zhou is accusing Mr Kousal of taking excessive advantage.

But Mr Kousal's lawyer argues the sale is legal and binding.

He told the court the sale was legal and could have been sold for one cent.

Lawyers for the sheriff's office say it had no obligation to get a fair price.