We live in an inner suburb of a major Midwestern city. We paid 165K in 2007 (damn it!) for the house when it was a 2 bed/1 bath. House was 1100 sq ft, lot is 7500 sq ft. We built a 75K addition on the back a few years ago, so now the house is 1600 sq ft (3 bed/2 bath) with a brand new basement with a roughed in bathroom to eventually finish. Midwesterners love their basements! We paid for the addition in cash, as well as paid off a second mortgage we originally took out. So our current mortgage payment on a house worth about 210K (just a guesstimate) is 1K with taxes.
As far as the neighborhood, it is highly sought after. It was already on the upswing when we bought and now has exploded. Houses don't stay on the market for more than a week. The schools district is getting better. We call this our "feet first" house, so the upswing is immaterial to us financially but wonderful for our daily lives. My only worry is that it is becoming too upscale. Since we moved here our small downtown has acquired a second brewery, four new local coffee shops, a local bookstore, a motorcycle shop, several expensive restaurants, a local garden shop, a chocolate store, a fancy olive oil and vinegar store, a vape store, a piano bar, a pinball lounge for adults. Up and coming are a beard grooming shop (yes, really....hipsters, you know) and a cat cafe. It's awesome and overwhelming at the same time. But, hey, I'm not complaining.