A lot of folks are still under water on their homes...That being said, demand for existing housing is increasing at an increasing rate.

If you are under water on the car, it may be better to work hard to pay it off.

This doesn't not mean that you can't find a diamond in the rough once in a while.Also, with no money down you have zero equity in the property, which equal tremendous risk, especially if there was a decline in the house market, these people would find themselves underwater very quickly..This idea seems more like a "pipedream" to sucker in the inexperienced in to buy a course than actual reality.

I imagine if these people really went through this process the vast majority are likely underwater right now. 

Declining locations work for the short term but over time you can end up underwater and have insufficient rent to cover your operating costs.

I definitely know that, within Benicia (especially at the condos), there were quite a few that were underwater in 2008.

Was he under water and unable to rent out?  

When I bought the property it was cash-flow positive, but the crash of 2008 hit and I was underwater on my loan and rent dropped so much I was negative cash-flow.

I've not lost money on a RE deal but I've had a couple of pretty thin ones; if the market took a sharp dive, I'd have been underwater.

I don't get into an investment property planning on a quick appreciation hit and then selling before I am underwater.