The Spence family home at 64 Cliff Rd has been bought by the Gujurat NRE company, with real estate agent Steve Cicekdag acting on the company's behalf.

Mr Cicekdag said the company and chairman Arun Jagatramka intended to build another house on the prime site overlooking Wollongong Harbour.

In 1997 Norma Spence went down in Illawarra folklore with her determination to resist all offers from developers for her home, built by her grandfather, George Dodd, in the 1920s.

Mrs Spence died last November and in March her four adult children decided to sell the cottage as it was the only way all family members could equally benefit.

Mr Cicekdag was one of the many agents who approached Mrs Spence on behalf of developer John Carson a decade ago.

At the time Mr Carson had plans to build an international hotel on Cliff Rd.

Mr Cicekdag said the house sale was settled yesterday after the Indian company gained approval to make the investment.

"The family is very happy," Mr Cicekdag said.

"They feel sad history has passed on, but they are very happy to hear there is a possibility of a house being built on the site.

"They asked me to wish all the best to the new owners ... but they are ready to move on to the next chapter of their lives.

"This makes my belief even stronger that people will pay top dollars to live in the jewel that is Cliff Rd. Vaucluse, eat your heart out."

The previous record for a Cliff Rd house was $3.8 million paid in March last year.