WRT to knocking down and existing house and building on the land, the cost of demolition is not cheap. You will need to get the permits through council, and also pay for disposal of the old house waste. You will still have to pay council rates on the property (I just paid ours a couple of months ago and the slab wasnt even laid lol)
I would look very carefully into demolitions before going down this route. If you want to build, unless you have a substantial bank balance, I would suggest you are better off looking for new land.
Thanks for that Limeslice, looks as though we had already been considering a lot of those areas.

We will be living on site whilst rebuilding, so rates will not be a problem. We spent ages looking and it was cheaper to buy a property with the right land, rather than just buying the land then buidling, also it gives us somewhere to live whilst we work all this out. We are hoping to not have to demo but to see about selling off the house, or even just let someone take it. If we have to demo, that will be fine, DH used to do that for a living and then we will try to recyle what we can and the local recylcing centre will take the rest. What we are doing will take time