I recall looking at condos in Telluride in about 1979 with my old man. He snorted in disbelief that a condo at the base of the chairlift would cost as much as $35-40,000, along the lines of, "Why, you could buy a decent 3-bedroom house for that at home!"
Of course, those condos now sell for well over a million dollars.
Another place I have seen this happen is at Coronado Shores, just south of the Hotel del Coronado in San Diego. These were condo high-rises on the beach, built in the 1970's before there was a Coastal Commission. There will never again be buildings of this sort allowed within a mile of the California coast. Time was when you could buy a 3-bedroom condo at the Shores for 50 or 60 thousand; now they are 3 million for a good one.
Location is everything. If it's a crummy location, it will always be a bad investment.
-ccm
In the case of Coronado Shores, it was location + draconian governmental restrictions on new construction.