Understanding what’s likely to happen to property prices in the future can be really helpful in knowing whether now is the right time to buy or sell.How can you use property price forecasts to help you make your decision?This really depends on whether you are a first time buyer, trading up, down, investing in property, looking at exiting from your investment and whether you are taking out a mortgage or have cash.What do the forecasts say?Ideally, property prices would always increase just ahead of inflation. Over time the average inflation is around 3% per annum, but at the moment and for 2014 it looks like inflation will run at around 2%.In comparison, the forecasts range from 4% in Scotland to 8.4% in London for 2014 and over the next five years, property prices are estimated to rise from 17% in Scotland to 39% in London. Now, although these figures sound enormous, don’t forget if inflation runs at 3%, to stand still, property prices over a five year period to keep pace would need to increase by 16%.So the predictions are that Scotland’s property price growth is in line with inflation, and areas such as the North East and West, Yorkshire and Humber and Wales won’t grow much more either. So in these areas, although there will be different price changes for different property types in different local postcodes, overall it doesn’t matter too much when you buy as prices aren’t expected to rise that much.However, in areas such as the South East and West, East and West Midlands and the East of England and of course London, knowing what prices are likely to be at, at the end of each year, can be helpful in knowing whether it’s best to buy now with a 5% deposit or whether it’s better to save up for a higher deposit, knowing how much you may need.Below I’ve given you some thoughts on how to think through whether it’s worth buying now or wait for a while, and from an investor’s perspective, how to work out whether it’s a good idea to invest in the area you are planning to or not.First time buyers, should you buy in a rising market?For anyone looking at buying in areas like London where you’ve seen a sudden 5-10% increase in prices year on year, it’s feels very scary at the moment and better to buy now than in the future.And to some extent, in areas where you have 7-8% growth in 2014, if an average property price is £200,000 now, in a year’s time, these forecasts suggest prices would be around £215,000, so a 5% deposit would increase from £10k to £10.75k. However, if you could save up another £10k so put down a 10% deposit instead, you may get a better mortgage rate so your costs are lower.On the other hand, if you do buy now and put down a 5% deposit, then your property’s value could increase by £15k, allowing you to increase the equity in your property from £10k to £25k, so £25k over £215,000 would give you a ‘deposit’ of 11.6% and as you are likely to be on a repayment mortgage, the equity may be even more.But, and it’s a big BUT, by 2016 interest rates are likely to start increasing, so it’s important to make sure you don’t overstretch yourself too much as mortgage rates since 2000 have been as high as 7%, so if you do buy over the coming year or so, then make sure you can afford the mortgage on-going.Buyers and sellers trading up, is it good to buy in a rising market?When buying and selling in a market which is rising, it’s definitely a good time to sell and trade up sooner rather than later, as long as your job and finances are secure.For example, if your £150,000 property increases by 7%, then it would be worth £160,500 by the end of 2014. If you then buy a property worth £300,000, then that would cost £321,000. So you’d earn an extra £10,500 on your current home, but then it would cost you an extra £21,000 to buy the new one.Buyers and sellers trading down, does it matter when you buy if prices are rising?For anyone looking at trading down, it’s important to make sure you move to a property and area which is right for you, especially if you are retiring. Although seaside towns and lovely rural settings may seem great to start with, if you are retiring, making sure you have easy access to public transport, doctors, hospitals and indeed having family and friends close at hand, is incredibly important.But the good news is if you are trading down, a rising market will help you financially. If you are selling a £350,000 property and hold on to it for a year at a price rise of 8%, then it should be worth £378,000 – if you own your property. In the meantime, if you then buy a property at the end of the year which is worth £200,000 now, if it too increased by 8%, you would have earned £28,000 from your own property, but spend only an extra £16,000 on the property you trade down to.So from a trading down perspective, buying when you find the right property is more important than worrying about house prices, as long as the area you are buying into rises at the same rate (or less) than the one you are selling in.