HAVING a radioactive waste dump next door does not affect house prices, such is the demand for waterfront property in Sydney, according to a real estate agent who described the site of a former uranium smelter as "a slight variation from the norm".

Jocelyn Gregory, the principal of real estate firm Hamilton & Co, has the unenviable task of selling the house next door to the contaminated plot in Nelson Parade, Hunters Hill, where the NSW Government plans to dig up 1000 tonnes of radioactive dirt, which includes traces of uranium and thorium, to allow for residential development.

"I don't think it has impacted on the price," Ms Gregory said. "How many waterfront properties with boating access for that sort of money can you buy in the main harbour in Sydney?"

The sandstone mansion at 5 Nelson Parade is owned by Edward and Grace Hur, retirees who bought their home for $1.9 million in 1999 without knowing about radioactivity in the area. It has been up for sale by private treaty, for more than $4 million, for some time.

The Hurs are holidaying overseas, but their son Denis said they found out about the problem only last year when they received a letter from the Government about proposals to clean up the site.

Ms Gregory said every person who has inquired about the home had been told about the problems next door - which would in any case have been hard to miss, as technicians with crackling Geiger counters trundle across the block.

"We have notified every single buyer who has expressed interest exactly what the situation is," she said. "We're disclosing it verbally and also the contract covers it very thoroughly."

Some buyers had been turned off by the uranium threat, Ms Gregory said.

"There are always people who don't like property for various reasons. A lot of people shy away from anything that's a slight variation from the norm."

The site has played havoc with land values in the area in the past. In 1978, shortly after the Government acquired the two most affected plots, a neighbour could not sell a waterfront block for $42,000. It attracted a highest bid of $16,000.

The NSW Government's plans to develop the site came under fire this week, after it emerged that some residents were unaware of the danger of elevated levels of background radiation.