[lopmotr]

You misunderstood me. You've described the same self-perpetuating phenomenon that I was referring to. By "fundamental", I meant something stable that isn't a consequence of gentrification or white-flight. For example, being near a harbor, on flat land, good ocean views, low risk of flooding, or for smaller areas with weak influence on their environment, near a big city, near convenient transport/roads, etc.

Without fundamentals like that, then it is arbitrary decision which neighborhoods have high prices and which have low. It becomes an accident of recent history that could flip the other way over a period of decades and ruin people's investments.