Nothing hits closer to home, quite literally, than falling property prices.

For most of us our houses are the single biggest investments we will ever make. What's more, you are probably still doing battle with the resultant mortgage repayments.

So recent predictions that values in some areas could slump by as much as 20 per cent in the next few years - thanks to higher interest rates and record low affordability - are frightening indeed. Thankfully, they may just prove to be wrong.

Forecasts released last week by industry analyst BIS Shrapnel say there will be only a brief period of stagnation in 2008-09, thanks to one more interest rate rise, and then prices will resume a gentle upwards trend.

Why? Because the cost of renting is expected to rise much faster than the cost of buying, due to the exodus of investors and subsequent shortage of rental properties.

Also, there's an undersupply of new housing due to national population growth - partly immigration - at levels not seen since the 1980s.

And because an easing in the credit conditions, which will flow on to lower interest rates, will once again make it attractive to borrow money.

So what of the outlook for the various regions? Brisbane is predicted to be the standout, with strong wages growth and an outperforming economy pushing up values 22per cent by 2011 (to a median house price of $515,000). Similar growth is also forecast for the Sunshine and Gold Coasts.

The next highest is expected to be Darwin, with 21 per cent (also to $515,000). Then come Sydney, Melbourne and Adelaide, on 18, 16 and again 16 per cent respectively.

In Sydney a resumption of growth to a median price of $650,000 by 2011 will bring the city back to fair value.

It's worth noting that satellite cities Newcastle and Wollongong are expected to grow by a similar amount as buyers are forced further afield by lack of affordability.

Meanwhile in Melbourne the recent price surge - fueled by strong demand, insufficient supply and increased wages - looks to be all but over for the next year or two.

By 2011, however, the median house will have moved from an estimated $455,000 today to $530,000.

And in Adelaide, the most affordable of the mainland capitals, a near-term market softening should see prices go from $365,000 to $425,000 by 2011.

Perth is forecast to be the most subdued capital, at 9 per cent growth (to $500,000).

What does it all mean in terms of when and where you should buy, or whether in fact you should sell?

I would posit nothing.

The time to buy or sell a home is when you are ready, not when this or that pundit says property's going to go up or down. And not when this or that economist says interest rates are going to go up or down.

But it's crucial to follow three key rules.

First, always have a decent deposit or amount of equity - aim for 20 per cent if at all possible, both for the buffer this provides against price falls and for the fact that, at this level, you don't have to pay lenders' mortgage insurance.

Second, don't buy real estate unless you can keep it for at least seven years - the length of the average property cycle. And third, never borrow more than you can afford - building in a minimum of four rate rises to your calculations.

Ultimately, you don't buy a home to make money. You buy it to live in and enjoy.

Investment property is, of course, a different matter entirely.