First-time home buyers Alison Harney and her husband, David Bradley, said they had their heart set on landing a house in their dream neighborhood — Grant Park in Atlanta.
“The homes are beautiful and it also has this really great charter school system that we want to be a part of,” said Harney, a pregnant mother of one.
On their new-home wish list were the following: three bedrooms, two baths and enough space for their growing family — all at a price tag of less than $300,000.
The problem: The couple, who were renting in Grant Park, kept getting priced out. One home went for $350,000; another, $319,000.
“We had been thinking that we weren’t going to be able to stay in Grant Park,” Harney said. “We were going to have to leave the neighborhood we had really fallen in love with.”
But according to estimates from Trulia and National Association of Realtors there are about 1.7 million undervalued homes nationwide on the market today.
Rob Smith, a real estate expert who’s helped families like Harney and Bradley’s, offered a tip.
“A good rule of thumb is to try to buy the cheapest house or the worst house on the best street,” Smith said. Then fix it up, he said.
Barbara Corcoran, a New York real estate expert who appears on ABC’s “Shark Tank,” agreed.
“You should never shy away from the house that looks terrible,” she said. “Go in and see what’s so terrible about it.”
Smith and Corcoran said as long as the structure of the house is sound and you like the layout, look past the ugly or outdated interior. They did caution, however, to always get an inspection.
“Lots of people are afraid of the wrong things,” Corcoran said. “If the big structural items check out, don’t be afraid of a bad kitchen or a bathroom or poor carpeting or weird colors. That’s all the easy stuff that you can change quickly and make a fortune.”
Experts suggested potential home buyers ask their agents to show them “pocket listings,” homes that have not yet hit the market.
Harney and Bradley looked at seven pocket listings in one day. They eventually landed a three-bed, two-bath home for $283,000 (and in Grant Park.)
“We’re thrilled that we found something in our price range,” Harney said. “Having the park and the farmer’s market and the zoo and everything right there, it meant so much more to me than having another room or a nice bathroom.”
Corcoran said buyers should take a chance on those residential diamonds in the rough.
“You get the right school district. You get the right neighbors. You get your future retirement fund. You’ve got to take that chance if you want to make a killing,” she said.