The property clock has a typical duration of anywhere between three and ten years. There are longer durations that exist, typically 40 years+, within our own home ownership goals. If we understand this cycle, which I call the lifetime property clock, we can then have a whole understanding of the property market.

This is because the property market is made up of investors following the property clock and owner-occupiers following the lifetime property clock who look for a home to live and bring up their family in. Look at the following diagram:We can see that there is a definitive clock that exists within our own personal property goals over our lifetime. Let’s look at the detail of each stage of the clock.

1. Single Person Or Young Couple Aged 20 To 30

You start your working life, more specifically receiving a pay packet, and start spending what you earn on all sorts of products and services like clothes, electrical items, eating out etc. But you do all this from your parents’ home! There then comes a point when you want your own place as it doesn’t look that cool having the latest designer gear, the Porsche, but still living in your bedroom that you have been in since you were born!

A ‘pad’ is needed to prove that you are independent. At this time the single person turns into a first-time buyer. There will be scenarios where a couple gets together to buy for the first time and they will also fit into this category.

First-time buyers (being single people and young couples) will want to preserve as much disposable income as possible. This is because it is the younger working generations that like to spend in the bars, clubs, restaurants, high streets and travel agents and they need the money to do so. So they will aim to buy a property that:

The properties that meet this criteria will be at the cheaper end of the market. Specifically they will be studio, one and two-bed flats. Invariably these types of properties will be cheaper than the terraced, semis and detached properties. There will be exceptions to this rule. Consider the cost of riverside luxury apartments and penthouses compared with the cost of ex-local authority houses. The riverside flats will be more expensive than the terraced and semi-detached properties but it will be likely that the buyer of these flats will not be your typical buyer.

It may be a second home for a wealthy businessman or a second or third-time buy by a young professional moving up the corporate ladder. It could be the case that the lifetime property clock for some individuals will only ever consist of flats but these cases will be rare and can be eliminated from this clock as we are dealing with the norms. They will also be smaller than all the other property types and maintained by someone else, typically the freeholder.

So first-time buyers will be drawn to flats. This can be seen by the way newly constructed flats are marketed. The show flat is decorated to a modern standard as the developer knows that the typical buyer of the flats will be young so they to make the show flat appeal to the young. Second bedrooms are dressed up as study rooms rather than baby rooms. Living rooms are larger at the expense of the kitchen as the developer knows that the young often eat out and prefer a larger living space.

So it is established that flats are typically bought by first-time buyers. I have assumed that a first-time buyer is not a young family. There may be some young families that do look to get on the property ladder but again, we are working within norms. An example of this would be Jack.

Jack has £8,000 saved and earns £18,000 per year. In his area he sees flats going for around £75,000 and houses going for £120,000 plus. His buying power is calculated as:

To calculate what he can afford we just plug in the figures. The deposit is £8,000 and the mortgage he is able to get will be four times his salary. So buying power is calculated as:

Which equates to £80,000. So we can see he can clearly only afford a flat. So he buys a nice one-bed flat near the town for £80,000.

So as nature follows its natural course what happens next to the first-time buyer is:

• if it’s a single person they meet the love of their life and decide to have a family;
• if it’s a couple they decide to have a family.

It becomes apparent that having your children sleep in the same room as you do is not such a good idea! A bigger property is required, preferably with a garden for the child or children to play in. Therefore a house is needed...;