A family once shut out of Ann Arbor home ownership now has a lawn to mow and taxes to pay. A young couple skipped a starter house and moved straight to a multibedroom family home. And a professional couple saved hundreds of thousands of dollars off an asking price from a few years back.

It’s the silver lining to the housing bust. Jon Boyd, who’s been a buyer’s agent for fifteen years in Ann Arbor, says sellers have been “much more motivated the last two years.” He’s seen them cutting prices, of course—but also contributing money toward closing costs, offering a car along with their home, or even rewarding a successful selling agent with a big-screen TV.

Still, finding good deals is hard work, especially as the supply of homes for sale shrinks and mortgages become harder to obtain. Boyd urges caution, warning buyers to think about resale values and not to overlook serious flaws. “Sometimes people miss why it’s a good price,” he says.

The other big question facing bargain-hunting buyers is when the market will bottom out. Those who wait for still lower prices could miss out on a home they really like, warns Heidi Elder, a buyer’s agent for the Bouma Group. But some are willing to take that chance—like a U-M prof who’s decided to stay on the sidelines, convinced that prices may fall for several more years.

Looking long, starting big

Lily Sacks-Hubbard and Paul Hubbard began looking for a starter home in the summer of 2006. Ready to leave their north-side apartment, they visited four or five open houses every weekend, eventually collecting a stack of information sheets about three inches high.

“We had gone to open houses religiously every Sunday. That was what we did,” says Lily, a part-time social worker at St. Joe’s Hospital. (Paul was in mortgage sales when they started their search; he now sells tax and accounting software.) They eventually looked at more than 100 homes, including tiny ranches and foreclosed homes that needed a major remodel. They made six offers, and paid for so many inspections that their inspector started giving them a discount.

After almost ten months of searching, they saw a colonial house on Lillian with corner cupboards, a deck, and the big backyard Paul wanted—and five bedrooms upstairs. The house, owned by a Pfizer family, was bigger and in much better shape than they expected. They paid $205,000 and received 3 percent back in seller concessions, enough to cover their closing costs.

They’ve put their imprint on it, painting the family room a Merlot burgundy and the living room a sage green. Their parents gave them some extra furniture, but the 2,000-square-foot house still has room for more—more furnishings and more people. Lily’s sister lived with them for a couple of months while she finished a degree at EMU. And they hope eventually to have children who will fill some of the bedrooms.

“This is not a starter home. This is our final home,” says Lily. “With this one we just got lucky.”

Their advice: Make a budget and know what you can afford. See a lot of homes. And find a home inspector you like and trust.

Skyline High and a financial hand

Nancy and Roy Birk knew they wanted to live near Skyline High School so their son, Garrett, could go there. They had previously owned a home in Missouri but couldn’t afford anything in Ann Arbor when they moved here seven years ago. Nancy works for the U-M’s Institutional Review Boards and is a doctoral student in education. Roy works for a vending company that delivers pop and coffee to the university.

They worked with Steve Wickland, a Charles Reinhart Company buyer’s agent. They told him they could pay $175,000 to $210,000 and needed a place that would be large enough for them and their two teens plus dogs. They looked at more than forty homes.

“It was an adventure,” says Wickland. The couple made unsuccessful offers on five homes. The lease on their rented Chapel Hill condo was running out, and Nancy admits she was getting nervous. But Wickland “was persistent,” she recalls.

The owner of 1611 Creal Crescent, a neat 1950s ranch off Miller, was getting married and was motivated to sell. They offered her the asking price of $175,000 and got some assistance on the down payment through a program their banker found. The seller agreed to pay the rest of the down payment, their closing costs, and more—about $12,600 in all, including nearly $2,000 toward home improvements.

“The house was in such nice condition,” says Nancy. It has shiny hardwood floors, a finished basement, and a fenced yard for the dogs. The only drawbacks are no garage and only one bathroom, but Nancy and Roy are seeking bids to add a second bath this winter.

The Birks’ advice: Be patient. Bypass the “junk.” And find a real estate agent who really knows the market and will negotiate hard on your behalf.

The condo and the single guy

Damon Grosz, twenty-nine, started seriously saving up for a home about three years ago while sharing an apartment with roommates. He read articles online on home ownership, and compared the costs of buying and renting. “I really wanted to make a sound investment,” says Grosz.

He began shopping this past May, looking for places priced below $170,000. Grosz, who is single and works in facilities management at Crisler Arena, focused on single-family homes with a garage or basement—”I wanted to have my golf clubs out of my bedroom,” he says.

He saw dozens of homes, but many, he says, were “in need of serious repair.” At some point his agent convinced him to consider condos too. In September, Grosz moved into a two-bedroom, two-bath condo in the Heatherwood complex off Lohr Road. It has a small study off the living room, and a huge master bedroom. It’s on the second floor, so no basement, but his golf clubs fit comfortably in his one-and-a-half-car garage. And he considers the $133,500 price a bargain. He figures the fees of about $200 a month are part of the costs of ownership, and if he’d bought a home, he would have spent that much or more on improvements and services.

Grosz’s advice: Check your credit and get your finances in order. Work with experienced pros. And keep an open mind: what you picture when you start may not be the best choice and best value you find.

The skeptic on the sidelines

Nationwide, one in five potential buyers has postponed a home purchase in the expectation that prices will fall further, according to a National Association of Realtors survey. Some Ann Arborites who can afford to buy are instead renting homes or condos and biding their time. Among them is a U-M professor who asked not to be named because he does not want to hear from angry real estate brokers. He studies the economy and real estate and expects home prices to fall for several more years.

When prices are falling, he says, owning a home is far costlier than renting. With the economy poised to go into what could be a “fairly severe recession,” he says, “it makes sense to reduce your risk by renting.” Taking his own advice, he’s currently renting a house along the Huron River. Though he has looked at a few homes for sale in recent months and even put in one offer, he plans to stick with renting for a while.

His advice: If you do buy, drive a hard bargain and check websites such as zillow.com and realquest.com for a read on recent prices. If you can buy at least 10 percent below the market, he says, “you’re protected [against price drops] for a year.”

The neighborhood and the history

When Tom Puricelli and Sara Freudenberg-Puricelli first saw their house on Fountain, it was vacant. The asking price was $175,000, the top of their range, and the circa-1895 house needed plenty of work. But they immediately saw its potential, picturing knotty-pine floors beneath carpet and aged linoleum, and crown molding added to the twelve-foot ceilings.

“We just looked at each other and said, ‘How much do we need to give you to save this house for us?'” Sara recalls. “I could just imagine the Christmas holly going up the staircase.”

And when they learned the house was priced at $100,000 below its assessed value and had the original claw-foot bathtub upstairs, they jumped at it. Their offer of $158,000 was accepted last December. Within weeks, Sara was laid off from her job at Concordia University. But Tom’s job at Menlo Innovations was going strong, so they went ahead with plans for renovations, some of which they did themselves.

Married for eight years, they’ve lived in Texas, at a girls’ boarding school in Connecticut where Sara worked, and for a year on Concordia’s campus. They have a six-year-old daughter, Markey.

They love their neighborhood, the refinished pine floors, and the wraparound front porch that still needs work. Sara, who sells Mary Kay cosmetics, stores her inventory in the closet off the dining room.

They’ve redone the kitchen, including new appliances and a granite countertop, but held the cost to about $10,000 by skipping contractors and working with Lowe’s. Elsewhere in the house, electricity and plumbing have cost another $11,000 and refinishing the floors and other cosmetic fixes another $5,000, Sara estimates. But the result is a beauty: the original doors have fancy hinges, and there are a few antique pieces.

“I’ve always been a bargain hunter,” says Sara. “And my husband has learned to be handy.”

Her advice: Look beyond the cosmetic features of a house. “Be willing to make it what you want.” And, she adds, “you can live in rubble” at least for a little while until you can fix the place up.

To Saline and back

Anuja Rajendra and her husband, Vijay Sankaran, liked the little Cape Cod on Revena that they owned a few years ago. But with a baby on the way, it suddenly seemed too small. They considered adding on to it, then looked around for a bigger home, and ended up in Saline in 2004.

They bought a wonderful home with a huge yard of more than an acre. But they soon started to miss Ann Arbor’s culture and sensibility. Anuja says that when they turned off I-94, “my heart was always pulling me” back to Ann Arbor. Adds Vijay, “We’ve always been walking people, and our subdivision didn’t have sidewalks.”

So in the summer of 2007 they decided to sell the Saline house and move back to Ann Arbor. By then they had two boys, Chakor, now three and a half, and Kabir, now two. Anuja wanted a place where they could walk the kids to school and would see friends and neighbors walking by.

They checked out larger homes in Burns Park, Ann Arbor Hills, and other neighborhoods. “It was our third house, so we knew what to look for and what worked for us,” says Anuja, who grew up in Okemos and runs a fitness program called BollyFit. Vijay works at Ford’s Dearborn headquarters as an information technology executive.

Their home didn’t sell, so they decided to start again this spring. But they already had their eye on the house on Harding.

A gigantic gray place with a side yard, it had been vacant for more than a year. It had been priced as high as $720,000, in part because the former owners had added a mother-in-law suite and a master suite, giving the home five bedrooms and five baths in addition to its big living room and kitchen. Built in 1948, it was less elegant and less traditional than some others in Burns Park.

But by spring, the price had dropped to $460,000. “A fabulous buy,” Anuja calls it—”really a jewel” with “a good feel.”

So she and Vijay bought it before their Saline home was even officially for sale. They knew they would lose money in Saline, and they were nervous about the housing market. But they decided “it will all kind of even out,” Anuja says.

They love their new neighborhood; they walk to Burns Park almost every day. They also walk to Trader Joe’s and sometimes downtown. And they appreciate the home’s spaciousness—Anuja’s grandmother lives part time in the mother-in-law suite. They use a push mower for their tiny yard, instead of the riding mower they used in Saline. And if they occasionally grumble about the sizable loss they took to sell the Saline place, they remind themselves that Ann Arbor feels like home.

Their advice: When you’re selling a home, says Vijay, be willing to cut your losses and not take low offers personally: “The old level of pricing doesn’t exist in this market.” And, says Anuja, “listen to your heart rather than advice you get from others.”