This is the bit that scares me.
$400k for a ONE bedder??
And only
maybe a carport??
And, it's not even built yet.
Run away. You want certainty; not risk at her stage of life.
For that money, I can buy a 3 bed house with subdiv potential, and a double garage, with depreciation.
My advice; she is not far off retiring; the last thing you want is a risky investment.
Don't muck around - buy an existing house in a reasonable position, built after 1987 so she can get some good tax deductions off her PAYE. If purchased well, this could turn a neg cashflow into a pos cashflow after tax.
If she can access some more equity, use a bit more to buy a good solid share portfolio with high yield dividends (preferrably fully franked). I wouldn't use more than 10% of her useable equity for this though.