Behind the street fronts of Peter Street and Lady Lane in Waterford City, there is a patch of ground that once held a small cluster of houses cut off from the main thoroughfares, tucked inside the line of the Viking bank and ditch. This area, known as Insula South, takes its name from the Latin for island, which is appropriate: it was effectively an enclosure within an enclosure, a pocket of domestic life sheltered behind one of the earthwork defences the Norse settlers raised around their settlement. What makes it quietly remarkable is not grandeur but depth, the sense that ordinary people lived here across several distinct periods, layered one on top of another in the soil.

Excavations carried out between 1986 and 1992, published under the direction of M. Hurley and catalogued in detail by S. W. J. McCutcheon, uncovered traces of four structures in this area around Bakehouse Lane. The remains were fragmentary, disrupted by the expansion of St Peter's graveyard and by later post-medieval activity that cut through earlier deposits. Even so, enough survived to establish a sequence of some significance. One structure pre-dates the Viking bank itself, meaning people were living on this ground before the defensive earthwork was ever thrown up around them. Two of the structures were sunken houses, a form of building in which the floor was set below the surrounding ground level, often to aid insulation or to make use of the earth walls for structural support. This type of dwelling was common in Viking-age Scandinavia and Ireland alike, and finding two examples here, within the defended zone of the Norse town, adds a small but legible detail to the picture of how Waterford's early inhabitants actually housed themselves.