One could flip this on its head and say how do you underwrite a property in a hyper-inflated environment where the underlaying economic fundamentals do not support current property valuations?

And, let's start with some terms, "investing" has legal and financial meanings, look to the IRS, SEC, UCC, GAAP, and economics......."

@Jon KlausThe other point to remember is that with an index fund, you're getting alot of diversification; either S&P 500 or even a total market one, and you buy a major cross section of businesses across sectors, that represent the overall health of the economy.With RE, even 10 SFH, it lacks that level of diversification.This can be both good (i.e lets say you bought 10 SFH a few years back in San Francisco; you've got HUGE appreciation and laughing all the way to the bank!)

But much bigger worries abound about coming decades, about the rest of our lives and of our children's lives.It may seem paradoxical to some, but these increasing long-term fears may boost prices of stocks, bonds, and real estate to high levels while at the same time making the economic recovery anemic."

Functional and socio economic obsolencance

It depends on the economics of the deal but I personally would never ever let a trivial thing such as trash in the yard delay and possibly endanger my ability to purchase a property.  

I will be graduating from UT Austin next year with a bachelors in economics. 

It's easy to to find 4 or 5 deal a year that are home run deals but to find 3-4 home run deals it's is very tough.On top of that we will not buy suburbs where the investor ratio is over a certain percentage plus the economics growth has to be good.

The owner is out of state and can't travel due to health reasons.

@Sean Gover  Yes our office is on Isleta by the Hispanic culture center and the South Valley Economic Development center.