I agree with your point as it applies to much of the USA in 2016. Of course, there are always exceptions. Specific markets defy the general rule. Warren Buffet

I agree with your point as it applies to much of the USA in 2016. Of course, there are always exceptions. Specific markets defy the general rule. Warren Buffet has said that he never invests in trends or industries, but only in specific companies. Likewise, we could apply a similar rule to real estate. If you are allowed to get into a time machine and go back to New York City in 1985, then you should definitely buy up some buildings in Soho. They might look like burned out derelicts now, but this neighborhood is going to turn around in an amazing way. Likewise, a few years later, in Williamsburg. Also Berlin circa 1995, after the initial surge of investment had stopped, and people were having second thoughts about whether integration would ever work. Likewise much of Florida in 1924. Likewise Tokoyo in the 1970s. And I would argue, right now in Krakow, Poland. The idea is to buy real estate when most people think a city is semi-dead, before it rebounds. As Warren Buffet has said "Be greedy when others are fearful, and fearful when others are greedy. In the USA, a combination of low interest rates, government subsidies, foreign money seeking safety, and pure hype has managed to keep many cities in a situation where they seem to have permanently over-valued real estate. Anyone buying a home there runs the risk of losing money. Then there are the places like Detroit, which are either dead forever, or the turnaround is so far in the future that you could probably find better places to invest your money. But overseas, I believe there are places where you can invest in real estate, and see the kinds of amazing returns that you would have enjoyed if you could go back in time and invest in any of the turnaround cities that I mention above. Of course, it does take courage to invest in a city that most others are still betting against.