The Grade II Victorian property at 93 Goldthorn Hill was abandoned in the 1990s and was bulldozed in 2011.
But despite numerous proposals to bring the site back into use nothing has ever come to fruition.
Residents have long complained over the state of the vast boarded up plot, which has become infested with Japanese knotweed in recent years.
Now finally residents’ hopes have been raised that the site may be brought back into use, after it was put up for auction by Wolverhampton-based firm K Stuart Swash.
The plot has planning permission for a three bedroom detached house and a guide price of £85,000-£95,000.
Blakenhall councillor John Rowley has welcomed the move.
He has campaigned for years over the site, and said: “Local residents will be delighted if this development goes ahead.
“After years of complete neglect this would be very welcome.”
Hoarding has been around the site since the cottage was torn down by the council seven years ago.
The authority had become embroiled in a lengthy battle with the owner of the property, after he initially failed to respond to a demolition notice early in 2011.
The cottage was thought to be around 100 years old and had fallen into a state of disrepair, with all of its roof slates gone and its windows and doors smashed.
In 2005 an application was submitted for the erection of three two-storey four-bedroom detached houses, but the scheme was thrown out on the grounds that too many dwellings had been planned.
Prior to that a campaign was launched to get the cottage put on a special protection list to get it restored and preserved. However, the move failed.
Over the years police became regular visitors to the site, which was squatted on numerous occasions.
Mr Rowley had argued that the eyesore site was not secure and posed a danger to the public.
It will go under the hammer on March 28 at the Ramada Park Hall Hotel.
Visit kstuartswash.co.uk for details.