I would get costings on how much it would be to build/fit out a shed on the new block. I seem to remember seeing some very rough costings of $1K per square metre and I'm pretty sure that didn't even include building the shed, just fitting out an existing one.

So d'you need to renovate the old house that you like or is it basically fine, it just needs shedding/undercover areas?

If so, I'd lean towards that one as the costs are more predictable. Much easier to cost buying a shed if you're not fitting it out to live in.

Having said that, having an established garden adds so much character to a place so I'd tend to keep looking for a place that comes with trees etc. The hosue we're living in is not my dream home, inside it lacks architectural integrity/character (though it has a great floorplan which compensates for a lot) BUT I love the block. It's like having our own park.

Sorry for ramble. Re, the proximity to river thing. Dunno. I tend to think that unless you have river views, then it doesn't matter if you're a block away or 10 mins away but that's just me