If the house is sealed up, the bank can apply to the court for sealing up the property after suing, but it cannot be auctioned. Provisions of the Supreme People's Court on the Attachment, Seizure and Freezing of Property in Civil Execution by People's Courts The people's court may attach the residence necessary for the life of the person subjected to execution and his dependents, but may not auction, sell off or pay off debts.
Legal objectivity:
People's Republic of China (PRC) Civil Code
Article 244
If the person subjected to execution fails to perform the obligations specified in the legal documents according to the notice of execution, the people's court has the right to seal up, detain, freeze, auction or sell off the property that the person subjected to execution should perform. However, the necessities of life of the person subjected to execution and his dependents shall be retained. The people's court shall make a ruling on taking the measures mentioned in the preceding paragraph.
civil law
Article 244
If the person subjected to execution fails to perform the obligations specified in the legal documents according to the notice of execution, the people's court has the right to seal up, detain, freeze, auction or sell off the property that the person subjected to execution should perform. However, the necessities of life of the person subjected to execution and his dependents shall be retained. The people's court shall make a ruling on taking the measures mentioned in the preceding paragraph.