To buy or built?

Hi Manush,
just a few points to help you make up your mind.

if you sell the block, you are subject to CGT (unless you currently live in the property) and also to stamp duty when you sell your property and also to 2 stamp duties when you buy the two new ones. Also factoring in agents commisions and other costs. You have to be able to sell your property for a high enough price and buy the two new ones at a low enough price to offset all these costs.

building another property on the existing one may be a cheaper exercise because you avoid all the costs and taxes of selling. I dont think you need to pay for subdivison costs unless you are planning to sell both (but check this).
I would do some research on costs involved and write then down on an excell sheet. include estimated rental incomes, purchases of new properties and costs of building (ring a builder but can use $2500 per m2 as a rough guide) compare the two scenarios on paper and see which one fares better. I would guess that building would come out to be more cost effective.

good luck

You should check with the water authority the cost for a second dwelling may be as much as 30k. Council will store these details in a folder. Check with the local water laws dept. You should consider converting the deductable loan into the PPOR loan, to be neutral in cashflow. With the money you spend in interest on the new property at the rear you can deduct intrest from the savings youve made. Developing can be time consuming some developers and builders only sleep four hours a night. The best advice would be to put the money in a trust and sell it back to yourself. Building is expensive Keeping in mind Footing sizes for the unit should be 600 deep x 300 wide with 3 bar F 11 top and bottom. Remember it is cheaper to build with negative equity than positive gains.