Assuming you bought the property after Aug 1996, you are correct, and your sister is wrong.  Don't forget the 50% CGT discount either.

Monster24

My exposure to John Fitzgerald has been as follows:

1/    I went to one of his Melbourne seminars last year,  and had one follow up free consultation.  (not with John)
2/    I have read all his books and seen all his DVDs.
3/    I have read his Wealth manual, "Untold Wealth: Sucess from Scratch"
4/    I have seen his infomercials at 2 am in the morning.

So I think that I have a fair idea of what he is about, and am therefore qualified to comment.

Here is how I see the advantages and disadvantages of his approach.

Advantages

1.   For the passive investor, who is happy for the normal property cycles to run its course, and acquire property wealth slowly,
      the strategy is sound.

2 . From the way it was explained to me,  his organisation has a strict investing criteria, which I believe are sound.

      For example, they will only  build 'x' kms from the CBD, there has to be so many schools within a certain radius of the property,
      they wont build in a area that contains more than 30% in rental properties,  and they target areas where large infrastructure
      projects are in the pipeline, and "positive" industry changes are forecasted, and population growth is forecasted.

3.  I like his emphasis on high "land content"

4.  I am impressed by the charity work that John is involved in.

Disadvantages

1.  If you are looking at property as a vehicle to use to either get out of the rat race quickly, then I don't think the strategy is for you.
     This is because:

     –  Your relying too heavily on market cycles,   (you can't rely on property going up every year),
     –  There is a limit on how many negatively geared properties you can carry, 
     –  For most people, there is a limit on how much money you can borrow.

    The strategy that I would use to get out of the rat race is as follows:

   1.  Acquire between 1 to 5 investment properties that you intend to keep for the long term, if not for ever.
        (It is ok if they are negatively geared in the short term).
 
        (You could use the John Fitzgerald strategy for this)

   2.  Get involved in doing some short term property trades / renos / etc.   Plough those profits into paying off your
        long term properties, and then you have a choice to leave the rat race.

       (You could use the Steve McKnight strategies for this)

        As Steve says, if you don't want to be at the mercy of the market, and be told by that you can't buy any more property,
        you have to take control of your situation.