Now the 0.4 hectare patch on Batemans Bay's north beach - three innocuous adjacent blocks between council land and the crystal bay waters - is on the market.

But buyers beware - it's not exactly a developer's dream.

The couple discovered their family land purely by chance last year when Eurobodalla Shire Council sent them the $500 rates notice.

More than 40 years ago the family owned swaths of land to the north of Batemans Bay but sold it all to the council - or so they thought.

The family was unaware they still had a claim to the three blocks - about one-third land, one-third sand and one-third underwater in the heart of the coastal escape.

They also had no idea where exactly the blocks were until real estate agent Greig McFarlane helped them track down their lost land.

Mr McFarlane, principal of Elders Batemans Bay, is handling the sale of the property at auction.

"They were told it was waterfront, so they got excited about that, of course,'' he said.

"Realistically it's worth between $30,000 to $50,000 for an acre in the middle of Batemans Bay.''

For the first time in 20 years the industry veteran is going to auction without a reserve.

"It's going to be sold on the day, if someone offers $500 it's gone, but I'll knock them off at $600," he joked.

The land is zoned for environmental sustainability, which strictly limits the potential uses. Mr McFarlane believes it's suitable only for a boat slab or as a berth for a caravan, provided it has wheels in case of flooding.

But he has encouraged prospective buyers to contact the council and explore the options for themselves.

"It's somebody who wants to buy a bit of beach for the kids' holiday, put a caravan on it, that's about as much as you can do with it,'' Mr McFarlane said.

The site is one of a number of privately owned blocks along the stretch of beach, including several entirely submerged plots sitting just beyond the shoreline.