Owners Shamus Fitzsimons and wife Angie have struggled to sell their £800,000 Dullatar House – located just outside Glasgow - so opted for the unorthodox approach of raffling off the property, with tickets costing £5.
However, Paypal informed the owners that because there was no “pre-approval” of the transaction it did not align with their policies.
Mr Fitzsimmons had his account suspended on the money transfer website.
It said: “In the PayPal acceptable use policy it is explained that pre-approval is required for any activity with an entry fee and a prize.
“No pre-approval was sought or obtained for the type of transactions you wished to receive through the PayPal account.”
“After much consideration, we have decided not to allow PayPal to be used to buy tickets for entry to house prize draws in the UK in order to protect consumers, PayPal and the people running such draws from the associated risks.
“We understand the disappointment that this issue has caused, and we sincerely regret that we are unable to support these transactions.”
Thousands of people who had bought tickets to win the home, which included a swimming pool, sauna and an acre of private gardens, were due to have their money refunded.