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API JANUARY 2014
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suburban houses in Sydney, Hobart and
What do you look for in an
High rent demand with positive cash
flow from day one, so that the investment
pays for itself and high short-term
growth potential to generate equity
What structure do you use to buy
Mainly family trusts, but we rely on our
accountants to suggest appropriate
structures depending on who is
involved and what the outcomes for the
What are the factors that you believe
drive property prices higher and how
do you identify them ahead of time?
The only factor that drives up property
prices is if the number of people
competing to buy properties exceeds
the number of properties available for
purchase. While we need to qualify
the nature of such demand and supply
by types of property, price ranges and
location, this relationship forms the
basis of market changes and the trends
are easily identified as changes in
sales and listings. Accurately tracking
them forms a major part of my housing
What advice do you wish you had
when you first started out?
My parents insisted that debt is a liability,
but I know now that property investment
success comes from leveraging, viewing
debt as an opportunity. I wish I had been
given that advice when I was 20.
What do you like to do in your
I enjoy writing – fiction, poetry and
serious stuff about the housing market,
but I also do a lot of walking and reading
to relax, and I love cooking.
What kind of music do you enjoy
Anything with a good solid tune and well
put together lyrics, like Paul McCartney’s
Mull of Kintyre or Queens of the Stone
Age’s No-one Knows.
What’s your favourite movie?
The Party with Peter Sellers. The
unforgettable lines and situations have
given my family a host of funny phrases
for almost any occasion.
What are your bad habits?
Letting my passion for research and
analysis get in the way of other important
parts of my life.
If you could change one thing about
yourself, what would it be?
I find it hard to say ‘no’ and tend to
overpromise in order to please people. I
then find myself under pressure to meet
the deadlines I’ve given. I’ve been like
this all my life, so I guess that’s not going
to change, even though worrying about
the promises I’ve made does keep me
awake at night sometimes.
Where would you like to be in five
Doing exactly what I do now, but without
the occasional sleepless night.
What’s the secret to your success?
Being able to think strategically is my
biggest asset. I try to make everything
I do be part of a big picture plan. It may
take years to fulfil, but I never lose sight of
the ultimate goal.
What’s your most
I have been writing short stories and
poems since my early teens and have
kept them all. Reading those poems is
sometimes confronting, but reminds me
that life is a journey, not a destination.
They are my most treasured possession.
What are your greatest achievements,
professional and personal?
Writing my book Mastering the Australian
Housing Market is my greatest personal
achievement, because it enabled me to
crystallise my views on how the housing
market works. Having this book published
by Wrightbooks was my greatest
Paying for a property manager vs self-managing?
Definitely go with an experienced and qualified local property manager. Life is too
precious and short to be wasted changing light globes, replacing tap washers or chasing
Negative gearing and other property taxes?
While it may seem attractive to gear your ongoing revenue loss on a property against your
other income, you’re still going backwards and you can’t realise capital growth to make up
the difference until the property is sold. It’s far better to buy a positively geared property in
an area with the potential for capital growth.
Stamp duty and other property taxes were to have been abolished with the introduction
of the GST in 2000, but although these taxes are messy and inequitable, they provide a
critical portion of state government revenue. There was such a fuss at the time that they
stayed on, while residential property sales and rents were exempted from GST instead. I
guess it was the only option, as any change would have required an overhaul of the whole
state and federal tax relationship.
Capital city vs regional town?
My analysis has shown that capital city housing prices have risen significantly more than
those in regional and country housing markets since we became a nation in 1901 and that
the trend is continuing. So, all else being equal, for long-term ‘buy and hold’ investments, it’s
definitely capital cities.
If we’re looking at short-term ‘timing the market’ investments, the dynamics are the same
everywhere, so growth will occur where buyer demand is rising and there are current or
impending stock shortages. It then falls to other selection criteria such as purchase price
ranges and travelling distance, which is relevant if you’re conducting some improvements
It’s also important to consider that smaller regional towns can provide property buying
headaches, even if they tick all the boxes, because there may be a lack of property or pest
inspectors, conveyancers, property managers or tradesmen in the town.
What is your position on...
New Norfolk, Tas
2/3-bedroom brick house
3-bed federation cottage on 2 acres
3-bed 1950s timber house
3-bed highset timber house
Mount Isa, Qld
2-bed, 2-level townhouse
3-bed federation terrace
As part of John’s ‘timing the market’ strategy, he plans to buy in Weipa (Yorke
Peninsula, Qld) and Burrill Lake (south coast, NSW).
THE INTERVIEW // JOHN LINDEMAN
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