The uninhabitable Surry Hills home of “the woman Sydney forgot” Natalie Jean Wood sold at auction on Wednesday evening for a staggering $1,105,000 after fierce bidding.

A crowd of 120 gathered at Under The Hammer Auction Rooms in Rosebery to see the home, where Ms Wood’s remains laid undiscovered for eight years after her death, be offered to the market.

The buyers were mainly builders and young professionals all vying for a cheap entry into the inner city.

Auctioneer Matthew Shalhoub​ opened the bidding at $600,000, before taking more than 50 bids from 10 active parties.

“Don’t worry about the purchase price; think about the capital gain,” he said as bids slowed around $1,065,000.

“It’s called investment; it’s not called spending,” he said, encouraging bidders to add their own personal mark to the home.

It was bought by an investor builder, who will likely renovate the property.

Just Think Real Estate’s Edwin Almeida​ who made the opening bid on behalf of JB Construction described the result as “staggering” and “beyond belief”.

A handful of buyers walked out defeated before auction had even ended.

The dilapidated home at 139 Kippax Street was first listed in late January. The agent previously said “market interest” was at $550,000 to $650,000.

Domain understands at least one offer above $700,000 was made ahead of time. However, the agent was under instruction to take the property to auction. The reserve was not disclosed.

Mr Almeida said it would take at least $300,000 to renovate the home to a habitable standard appropriate for the area, noting his client had spent close to $4000 in research fees for the property.

University of Sydney associate professor Henry Woo, who made a bid but was also unsuccessful, was hoping to turn the property into a commercial cafe, named after Ms Wood.

The home was advertised as a dilapidated deceased estate and an “exceedingly rare chance to possess a property of unquestionable possibility”.

The Victorian terrace is completely uninhabitable, set on a 75.88 square metre parcel and has “unmatched scope” to overhaul and update the home, subject to council approval.

Selling agent PRDnationwide Perez Real Estate’s Corrinne Olsen previously described it as a “great blank canvas for young people wanting to get into inner city living at an affordable price to make something quite spectacular”.

Ms Olsen said the home was an “unknown” in its current state and would need substantial remodelling by the purchaser.

The property has original period features, such as timber flooring and fireplaces and is walking distance to Crown Street, Central and the CBD. It does not have parking.

Ms Wood was last confirmed seen in late December 2003, when she went to fill in a prescription. Her decomposed body was found in the front bedroom of her Kippax Street home in 2011, a month before her 87th birthday.