Elders Real Estate Wollongong principal Lou Niceski said it was a "record price for a three-bedroom fibro shack anywhere in Wollongong".

Yet the property at 13 O'Brien Street has elevated and beautiful views across Sandon Point to the Illawarra's northern suburbs' coastline.

It is this proximity to the beach and the jaw-dropping views which have seen O'Brien Street and many of the streets around it transformed in the past 15 years.

The older-style homes, many of which were former department of housing stock, have been bulldozed to make way for new multi-level mansions.

These days there's not much change from $800,000 if you're eyeing an old fibro in O'Brien Street, Point Street or Sommerville Street.

Mr Niceski sold the O'Brien Street home last Saturday to a Sydney buyer. There were 22 registered bidders at the auction.

"We ran a good campaign, the sales price was not unexpected but you never know where the price will end up until auction day," he said.

Mr Niceski was also responsible for selling 51 Point Street for $725,000 last November; 31 Point Street for $765,000 last October; and 63 Point Street for $770,000 last November.

The median Bulli house price is now $720,000, a growth of 18 per cent in the 12 months to March, according to Australian Property Monitors.

The O'Brien Street home, set on 671 square metres, has three bedrooms, one bathroom and a single garage. But it's the location that makes the property, which is surrounded by luxury homes, so desirable.

"It's rare land in that area and the property market has been very active and very hot and Sydney buyers are travelling to Wollongong," Mr Niceski said.

The reserve price at the auction was $1 million.

Mr Niceski said the new owners would most likely knock down the existing house and rebuild.

"Most of the homeowners in the area are doing the same," he said.

"Once you knock down and rebuild in that area you are probably looking at a property worth well over $2 million."

lturk@fairfaxmedia.com.au