When you are at the pre-plan stage and looking at blocks and deciding which one to buy it can be a mine field.
Things you need to know to help rough out the feasibility are
- how much is it approx to construct a single storey dwelling per square metre in your state at a suitable level of finish. For example I know in Perth it is roughly $1500/sqm
- how much is it approx to construct a double storey dwelling per square metre in your state at a suitable level of finish. Again I know for Perth and the areas I target $2500/sqm is ok
- how slopey is the land, how much will that impact on earthworks costs
- how much does getting sewer, power, gas and water cost for 1, 2, 3, 4 etc dwellings
- how much does it cost to get Council approval - DA, Building Permit, Council contributions etc
- how much will it cost to finish off the project, titling etc
Many of these things you can learn on here by people sharing their development threads or asking. You can also seek help from mentors, quantity surveyors and builders. However remember that most advice is general and you need to adapt it to your site and your project. ALWAYS include a contingency amount of 5% (at least) to cover the things you don't know, don't expect and general rises of the market.