It's can be awesome approach in inflationary times. Basically the principal on the loan devalues in line with inflation.
At 3% inflation a $100K loan becomes worth $40K in 30 years' time in today's dollars, at 5% inflation it is a little over $20K, and at 10% it is less than $5K. Of course, in deflationary or stable times it can bite you on the bum but this hasn't applied to much of the last century.
My first business landlord bought an acre property 10kms out of Perth (Australia) CBD for $14 around WWII time. His dad told him he was crazy for spending so much for a place in the boondocks. He sold it in 2000 for around $2M. I would love to have had the interest only loan on that... I guess 60 years is a long wait though, particularly if you are setting out for early retirement.