Thanks all for your advice, very helpful!    The property is owned equally by my brother, father and myself.  Technically, it is a vacant lot, and the Council treats it as such by charging Vacant Rural Rates($2,800/yr, twice that of non-vacant)…but it has a very old Settlers Cottage on it that is outside the gazetted building envelope of 1 acre.  My father has lived there since we bought the property, and has established a small Olive Grove of 24 mature trees(4m).
By my calculations, that means that 1 third of the capital gain can be removed, as was my fathers PPOR?  Is that possible to claim PPOR on a "technically" vacant lot?  Furthermore, we should only have to pay tax on 50% of the remaining capital gain because we have owned the investment for more than 12 months(50/50 rule) ?
And regarding claiming interest payments, am I right to assume that if we have been collectivley paying $500/week on an Interest Only loan, then at settlement we can offset the total cost of the interest paid over 10 years,
($500/week x 52 weeks x 10yrs = $260,000), against any capital gain we might make?
Im just learning all these little tax laws, so Im not sure if I explained that right? Hope you understood what I meant…
Thank you all once again for your wonderful advice!!!

Jim 

The first option sounds good, but it would have to be NO-DOC, as I have no ABN, GST rego or proof of income!
Margin loan against portfolio no problem! (more if needed?)
Little or no early exit fees are also pretty important for me.
U think theres anything u can do???

Jim

Bunbury is a port city, 200 km south of Perth in WA. There is
HEAPS of new developments and investment going on in the area, and capital growth is great(30%+in06). The suberb I am interested in is Carey Park. It is 2km from both Bunbury CBD, and the beach.
The zoning is R30(av lot size 333m2), and most of the blocks are 700m2+!
You can still get a house there for $270, 000, on a duplex block…but it WILL need work, but thats about the same price as the cheapest renovated house in Carey Park! A 333m2 rear duplex lot is worth about $120,000…so it adds up! [strum]

Jim

Thanks 4 your quick responses Richard and Indigo!
We do have SOME income. Brother earns $60k/pa but has just had his second child, hence Mrs out of action 4 a while. He also has PPOR loan of $120k, but has $140k equity in his house. I am disabled, but have equity of $150k block in Augusta, $100k of timber slabs n burls, and 12 unit site in Yarloop 100km from Perth CBD worth about $80k, at least! I basically earn enough 2 live on through trading shares online($10k account) + selling a bit of timber here and there. Dad is recievng unemployment benafits.
So you see, we are asset rich, but income poor!
Does that make it a bit clearer?
And yes Richard…its not a bad part of the world in which 2 reside!