When shopping for your first home, you're better off leaving your emotions at the door.
That's easier said than done, sure. But a home is likely the biggest purchase you'll ever make and you want your decision to come from your head rather than your heart.
"The emotional mistake that so many first-time buyers make is they fall in love with the apartment or the house instead of the block," Corcoran says. "It's nuts."
Your home doesn't exist in a vacuum. The value of your property, she says, is "going to be 85 percent determined by the block in the town you're living in. So you're much better off falling in love with a good block with a rickety old house than falling in love with a lovely, pretty house on the wrong block."
When it comes to real estate, in other words, location is everything.
To find the right block, start by shopping in the right neighborhoods.
Corcoran, who sold her real estate empire, The Corcoran Group, for $66 million in 2001, says the key to making a fortune in real estate "is to always buy in the up-and-coming areas." You'll get in at a lower price and, if you make a smart bet, you'll see "tremendous appreciation."
You're much better off falling in love with a good block with a rickety old house than falling in love with a lovely, pretty house on the wrong block.Barbara Corcoran
Her strategy for finding the next hot spot is unconventional but effective: "What I've always done is I've asked my very nice, very young waiters at new, posh restaurants: 'Hey, where are you living?' They'll always cite a neighborhood I've never even heard of and then I go out there and shop for real estate."
After all, she says, "if people are talking about it, it's already been up and it's already coming. Too late for that."
Corcoran was ahead of the curve when she shopped in the Bedford-Stuyvesant neighborhood in Brooklyn 15 years ago and the South Bronx 10 years ago. She didn't buy in these now trendy areas "because I knew anything that anyone else didn't know," she says, "but because I paid attention to the creative community and where they were migrating.
"You will always find the up-and-coming area if you follow their lead."
Don't miss: The 4 biggest mistakes first-time homebuyers make, according to real estate mogul Barbara Corcoran
Like this story? Subscribe to CNBC Make It on YouTube!