Oamaru, at 202 Liebig Street, was purchased by a local couple with a young family for an undisclosed figure.

Auctioneer Bruce Ludeman said they were the losing bidder at auction and negotiated the sale immediately afterwards.

A large crowd witnessed the auction which started with an $800,000 opening bid from the crowd and progressed from there until it was passed in.

"It was a bit of an effort," Mr Ludeman admitted. "It was successful and nothing's easy today."

The historic sandstone home sits on a 2300-square-metre block and has been owned by the Burnett family since it was built in the 1880s.

"It's the first time it has come up for sale. It's in a great spot but it needs a lot of work," Mr Ludeman said.

The buyers plan to move in and start a long-term renovation effort.

The auction was held by conjunctional agents Ludeman Real Estate and Northeast, Stockdale and Leggo.

Another central Warrnambool auction on Saturday also drew a strong crowd with Brian O'Halloran and Company offering a two-bedroom unit at 57 Kelp Street.

The property opened on a $260,000 vendor bid and progressed with a flurry of offers until it was sold to a local buyer for $311,000.

"There was good, spirited bidding and it went for well above what we thought," auctioneer Brian Hancock said.

There was not as much interest in a federation-style home at 39 Banyan Street offered by Charles Stewart and Company.

The auction opened on a vendor's bid of $610,000 and did not progress.

Agent Bernard Moloney said about 20 couples inspected the property in the lead-up to the auction and about 15 people attended on Saturday.

He said the home would now be placed on the market with offers sought around $650,000.

"We're confident there will be interest in the coming weeks," Mr Moloney said.

malexander@fairfaxmedia.com.au