Yacaaba, as it is known, was built circa1862. It was originally constructed by the Australian Agricultural Company for one of its senior managers and is representative of a period of significant population growth and increasing wealth in Newcastle.

It also signifies a shift in the nature of The Hill from an old mining district to a well-heeled residential area.

The grand residence is on offer for the first time since 1959, having been owned by prominent Hunter Street medical professional Dr Richard Wilkinson and his family for over 60 years.

In near original condition, the double-storey facade features side twin gables and an ocean view verandah. A wealth of period features include pressed metal ceilings, six fireplaces, French doors and a cedar staircase.

There are grand formal lounge and dining rooms, casual family and TV rooms, a 1960s kitchen, four bedrooms, two bathrooms and a study.

The home is positioned on a generous 639 square block. It has a tandem carport and brick courtyard with original stables.

The property enjoys a blue-ribbon position and is within walking distance of Newcastle beach and ocean baths, King Edward Park, Anzac Memorial walk, Darby Street cafes and restaurants, Newcastle's cultural centre and Hunter Street.

It is close to shops, schools and within minutes of the Newcastle CBD and University of Newcastle inner-city campus.

First National Newcastle City's George Rafty is marketing 28 The Terrace on The Hill with a guide of $3.5 million to $3.8 million. It is set for auction on February 6.