Listed online as a 'rambling old home in old condition', 13 Margaret Street sold prior to auction for $1.47 million.

The three-bedroom home on a large 1037 square metre block was bought by the owner for $90,000 in 1998, about a year before BHP Steelworks closed down.

It had been rented for more than a decade and was marketed purely as a development opportunity.

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MDRE Property Advantage's Mark Dowling said he expected the existing house would be knocked down and townhouses put in its place.

The sale follows a similar result at 54 Sunderland Street, Mayfield, which was bought for $1.25 million in November.

The 809 square metre property with R3 medium density zoning is also expected to be demolished and converted into townhouses.

"Both of them selling for over $1 million has sort of set a new precedent," Mr Dowling said.

"There's a lot of properties that are selling for over $1 million in Mayfield - good quality residential properties - and then also properties that are able to accommodate a granny flat."

The sale price topped Mayfield West's benchmark of $1,325,000 and fell just short of Mayfield's $1.53 million record.

Before 2021, just a handful of residential properties had sold for more than $1 million in Mayfield, Mayfield East and Mayfield West.

That all changed in 2021 as more than 20 seven-figure results were recorded in Mayfield alone.

The sale also set a new benchmark for Margaret Street, which had never previously reached seven figures for a standalone home.

A renovated four-bedroom home at number 49 went close in March last year, selling for $970,000.

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The home sat on 506 square metres and boasted an attractive landscaped garden.

At number 94 a larger six-bedroom home on 904 square metres, including a 282 square metre floor plan, had sold for $865,000 in early 2020.

Mr Dowling said he expected knockdown-rebuilds would follow million-dollar sales in becoming less unusual for the area.

"It was something you'd see occasionally in Mayfield, but now it's becoming quite common to see an old house demolished and something new put in place," he said.

"The new houses are worth over $1 million, so a standard block of 450 to 500 square metres would probably sell around that $500,000 mark.

"Then you'd have $400,000 for the build and that property would probably be worth $1.2 million.

"There's demand for it and the demand I think comes from interstate, Sydney, all over."