Businessmen George Fendyk and Geoff Lucas decided at the last-minute to attend the auction held in Melbourne on Wednesday for the three bedroom weatherboard house made famous by the 1997 movie.

They paid $40,000 for the property which was eight times more than the reserve.

Mr Fendyk and Mr Lucas are redeveloping the Mayday Hills site in Beechworth and have plans to use the Castle House as a manager's residence for a caravan park within the site.

"It will be a tourism attraction cum residence," Mr Fendyk said.

"We are still planning what we are going to do, but the house came up for sale and we just decided to buy it.

"We've got a few things to tidy up before we get around to it, but within the next year or two it will be well underway.

"It will be good for Beechworth and gives Mayday Hills another bit of impetus as well."

Mr Fendyk picked up the vibe of the auction to fight off one other bidder for the property owned by Vicki Cosentino, who has plans to build townhouses on the Dagonet Street address.

The latest rental lease on the home where the fictional Kerrigan clan of Darryl and Sal and family lived expired last month.

Its new owners have to move the house within 90 days and will need to apply to Indigo Shire for a permit to locate it in Beechworth.

"It will be an asset for the town so why wouldn't we get a permit?" Mr Fendyk said.

"It can't sit there in limbo for ever can it?"

Indigo Shire mayor Jenny O'Connor said the move was a pleasant shock.

"I knew it was for sale, but I had no idea someone was interested in bringing it to Beechworth," she said.

"It will be a great tourism attraction and will be yet another reason for people to visit Beechworth.

"I look forward to seeing what their plans are."

Earlier interest from Federation Council to bring the house to Corowa fizzled out.

"I would have much preferred it to come to Corowa," administrator Mike Eden said.

"But knowing the type of character George Fendyk is, there is no doubt he will make it work."