Simple strategy but not done before

It's an idea that can happen…if you needed to know that for re-assurance.

And keeping it in simple form. I would;
Negotiate the buy in price and terms as best you can i.e long settlement terms, excess early to perhaps renovate the existing property to add value and or to increase rental return.
A corner block might be advantageous as it ia better when sub-dividing because a drive way for the second block can be installed around the crn.
Be careful with thorough research of the numbers, comparative prices of other properties similar and any other pitfalls to do with development costs for the next person as that may prevent them from buying when you come to selling the block.  
A chat with council or a builder or an Architect is what i would do first before buying anything to show them the block and tell them the idea of what you want to accomplish first along with all the costings thoroughly with worst, best and average case scenarios in the numbers.

Others will give you some more ideas. Above all I would say "Go For It' you can make money if done right. Make sure you do lot's lots and lot's more research and know your area and market. Come back into the forum and tell us what action you made. There are lot's of dreamers around. Are you the difference and take action to succeed in what you want to achieve?

There are many people that talk about ideas and they like the idea of making a profit and return in real estate but there are few that do the leg work the hard yards or whatever it takes to 'make it happen'.

There is a little bit more involved then meets the eye.

First of all you obviously need to get council permision and I have heard that neighbours can object to this (im not sure though) then there is multiple fee's and charges you will be slogged with, Sweage, power.. I also think u need to have the block surveyed..then if you do get it subdivided and you can't sell it your paying 2x rates

A family member was going to buy a house on a large block and subdivide but backed out after subdivision costs where going to come to over $40 000

If your interested in doing this,  I would first go see the council and find out how much $$ they want out of it