Obviously that would be ridiculous in a general sense, but it can definitely happen in certain neighborhoods. But it's not only the value of the existing housin

Obviously that would be ridiculous in a general sense, but it can definitely happen in certain neighborhoods. But it's not only the value of the existing housing that increases, it's the value of the land under it. Once the gentrification begins in an area, developers want to get in on the action to add amenities, renovate existing buildings, and replace older housing with newer, more expensive housing. However, if the newer housing is better than the older housing elsewhere in the city, which is usually the case, that older housing should become less attractive. An extreme historical example of that is the decay of urban cores caused by white flight to suburbs (which were often only a short drive away from the urban cores, and therefore part of the same overall housing market with the same pool of buyers) in the postwar period. Some of the areas now being gentrified in major cities are becoming desirable for the second time.