A generous-sized block in Revesby has sold for $1,855,000 to a builder at auction on Saturday, making the sellers $235,000 in a year.

The three-bedroom house, on 1061 square metres, at 74 Vega Street had a guide of $1.64 million. It drew eight registered parties, all builders from the area who were eyeing it for its untapped development potential.

Bidding opened at $1.4 million and went up in varying increments from $100,000 down to $5000. The hammer fell at $1,855,000 – about $55,000 above the reserve.

It sold through Richardson & Wrench Padstow’s Charlie Elazzi who said no families were interested in the house as they would be competing with developers.

Cooleys auctioneer Michael Garofolo, who called the auction, said it was a strong result for the seller.

“The vendor bought it a year and a day ago for $1.62 million and has made $235,000 in capital growth in 12 months, representing a 14.5 per cent return,” Garofolo said. “In 12 months, in this market with rising interest rates, rising inflation and rising cost of construction that to me is a very surprising result.”

While it was unknown as to why the vendor was selling, Garofolo said the interested buyers were hedging their bets on a market upturn in coming months.

“In the fullness of time, property prices only go one way. If you’re hedging your bets, you don’t need to be the smartest guy in the room that property prices are going to go up again,” he said. “Inflation is coming off its peak. Maybe builders are getting off the sidelines and saying, ‘By the time we finish this we will be in a better market.’ ”