The film The Edge of Love, starring Matthew Rees, Keira Knightley and Sienna Miller, has re-ignited interest in the poet Dylan Thomas and his wife, Caitlin. The behaviour of this boozing, bohemian couple scandalised the communities of New Quay and Laugharne in West Wales when they lived there, off and on, between the 1930s and 1950s. Now a house that provided the backdrop to some of the most important events in Thomas's life has come on the market: Castle House.

The £599,950 sale price for the Grade II listed Georgian house also includes the ownership of the Norman castle next door, although the latter is in the guardianship of Cadw, the historic environment service of the Welsh Assembly, which is responsible for its maintenance, preservation and conservation. Nevertheless, the new owner of Castle House, and his or her immediate family, are permitted access to Laugharne Castle and its grounds.

Castle House, which dates from 1740, was rented in the 1930s and 1940s by Richard Hughes, author of the bestselling novel A High Wind in Jamaica and his wife, Frances, who became great friends of the Thomases. “He was an Oxford graduate and she had studied at Chelsea School of Art so they stood out as being very different in Laugharne,” Thomas's biographer, Andrew Lycett, said. “They provided Dylan with intellectual stimulation and they were a link to the literary world and London.” It was Richard Hughes who brought Dylan and Caitlin together in Castle House in 1934. Caitlin was visiting with the lecherous, much older artist, Augustus John, who was a kind of “sugar daddy” to her, and the meeting has passed into Dylan Thomas legend. The whole party set out on a booze-fuelled jaunt to the National Eisteddfod and the randy old artist became jealous as the young couple canoodled in the back seat; the trip ended with John and Thomas brawling in a pub car park and Thomas being left to make his own way home.

Four years later the couple, by this time married, decided to move to Laugharne themselves, firstly renting a damp two-up, two-down fisherman's cottage called Eros and later renting Sea View, a larger house. However, neither of these houses gave Thomas the solitude he needed to write, so again Castle House figured in his life story. Every day Thomas would trek up to the ruins of Laugharne Castle, adjacent to Castle House, and it was in a gazebo there that he wrote his much-acclaimed book of short stories Portrait of the Artist as a Young Dog.

There was another reason for Thomas borrowing the gazebo too - he found out that Hughes kept his wine cellar in a cool room in the ramparts of the 13th-century castle. Thomas, who throughout his life had no qualms about stealing from his friends, started helping himself to bottles. This practice stopped only when Hughes paid a surprise visit to the gazebo one day and caught him red-handed.

Richard and Frances Hughes were comfortably off at this time - in contrast to the virtually destitute Thomases - and they were generous hosts. The Thomases were often invited for meals at Castle House, where they drank good whisky and gorged themselves on expensive fare such as goose. One night Thomas started talking about a play about Laugharne, with the local people playing themselves. The seeds of Under Milk Wood were germinating in Castle House.

The house in Laugharne most famously associated with Thomas is The Boat House - the “sea-shaken house on a breakneck of rocks” that was his home when he died in New York in 1953. However, when the couple were again househunting in 1949 their first choice of a home had, in fact, been Castle House, not The Boat House. The Hugheses were just moving out at this time and it was only the owner's wariness of Thomas's reputation that prevented the deal being done.

Today the layout of Castle House, which has been run as a guest house since 2004, has been changed a good deal on the two upper floors. However, the reception rooms are roughly as they were in Thomas's day. From the front door you go into the hall where you find the drawing room to your right and the dining room to your left. Farther along the hall there is a morning room. From the dining room there is an inner hallway leading to a scullery and then you go into a large kitchen. You go up steps from here to a sitting room and play room. Upstairs there are three bathrooms and eight bedrooms, many with views of Thomas's “heron priested shore.”

Castle House is one of the more expensive properties in Laugharne, which has become increasingly fashionable. The actor Neil Morrissey has shares in local pubs and an hotel; visitors to the town include Mick Jagger and Pierce Brosnan. However, estate agents point out that prices drop significantly if you buy farther west. “The M4 and the A40 make places like Tenby, Saundersfoot and Laugharne reasonably accessible nowadays and prices have gone up accordingly,” says Richard Emanuel, of John Francis estate agents. “But if you drive 30 miles up the coast past Cardigan you'll find equally beautiful little villages such as St Dogmaels, Tresaith and Llangrannog and their prices are far more reasonable. A £230,000 cottage in Llangrannog will cost £300,000-plus in Laugharne.”

Some buyers, of course, will think it worth the premium to experience the particular charm of Laugharne, which Dylan Thomas once described as “this timeless, mild, beguiling island of a town”.

Castle House is for sale with West Wales Properties 01239 712760

Dylan Thomas: A New Life, by Andrew Lycett, Phoenix paperback, £8.99

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