WW, usually if a house sits on 2 lots, then there is one title. Also, the property would be listed with, and rated by, the council as a single lot. Further, you will find that there is only one sewerage connection, and one water connection. Should you want to go down the path of splitting, you can apply for 2 titles to be isssued at the time of transfer to you, and then you will have to apply, and pay for, the council to install the second service connections. Additionally you will have to apply for the second electricity and telephone connection. Once you have those, I believe you can then apply to council or a private certifier for approval to remove the home, if not in a Demolition Control Precinct, and the house was built after 1946, and then to build 2 new homes. If you dont want to go down the 2 lot path, the home removal guidelines may still apply to a remove/rebuild sinario.
Hope that helps
Cheers