Real estate is hot and location is everything, right?
Maybe so, but the setting of your novel could go either way.
The great thing about writing in the paranormal genre is the characters. Big or small, the characters are what will pull the reader in and keep them there.
BUT--I have to say setting can be a big chunk of the story. For example, take my book The Art of Fang Shui. The bulk of the book is set in a national park in Indiana. At night. Sometimes in the rain. What's more creepy than a dark, spooky forest on a moonless night in the pouring rain? Add in a cast of questionable characters and wham! There's a great story.
OR--in the sequel to that book. The story takes place in ordinary settings: an apartment, a marriage counselor office, office buildings. The setting is the background in this instance because the characters themselves are larger than life and can carry the tale.
Bottom line: it doesn't really matter as long as everything is interesting and works together to create an awesome book :-)