Ceffo,
I'm doing a duplex in Sydney South right now.
Just to give you some figures so you can compare:
Bought small old house on 665 sqm a couple of years ago for 517k
Rented it out while getting a DA for duplex development.
Just about to start building in a couple of weeks.
Building will cost 340k.
Other costs like demo old house, tree clearance, water/gas mains, etc are around 20k.
Council fees about 10k.
Then, still have to do landscaping, driveways, internal flooring and blinds, etc to finish off, approx 100k.
So costs without allowing for any hidden suprises are just under 1 mil.
But there was also stamp dut of 20k or so on the original purchase.
Then there is interest holding costs during the time the property is not available for rent.
I'd estimate final valuation for the pair of duplexes to be around 1.2 - 1.3mil.
This is my first one so no real experience.
I just think your building costs (to completion) will be well over 350k, especially with compliance of BASIX, which really puts costs up.
Maybe the 1.2mil sales price you predict is lower than what can be achieved.