wannabe developer

Hello people,

I am a seasoned reader of books, magazines, forums and blogs on the subject of investing. I am currently saving and would like to buy at the end of the year. I have thought of a few ways I'd like to combine purchasing my own place and using it as a great investing platform. Ideas I've had are buying a house on a big block and subdividing it off, live in the house and use the money to continue investing etc etc.

BUT…. Then I thought I'd hit the jackpot with a great idea, but it looks like CGT and GST are going to kill that. I really need to know from people who have done it or are in the finance field, a few answers to my questions:

I want to buy the worst house in the best street, knock it down and build a duplex/multiple townhouses on it, sell one and live in the other. The money made from selling one would pay down the loan and leave me with a good PPOR, a small/medium loan and a decent amount of equity.
What I have recently been reading has suggested that the property built to be sold will incur a percentage of GST and then incur CGT when I sell it – all of this eating into my equity and making the loan a lot bigger than what I intended. How much GST/CGT is payable? At what percentage rate? Will it decrease if the whole process takes longer than 12 months?? Has anyone done this or something similar? How did it work out?

Any responses would be greatly appreciated.

Cheers

Andrew