Having to manually "deploy" code to a local virtual server can be tedious, so running a background process that watches your local directories for changes helps a lot.
NFS allows us to edit code locally on our host, and have it "instantly" be ready on the guest. After just half an hour of working, the various inodes are cached on the guest and file system access over NFS is mostly native-speed since it only needs to grab changed pieces.
The end result: We completely ripped out background rsync despite John working weeks on it, and we put in built-in support for NFS, which has been going strong since around July now and is happily at work at many places that use Vagrant :)
Basically I tell it which directory I want it to watch for changes and it does automatic syncing by piping rsync. I keep a local and remote signature of the files and their timestamps. When it first starts up, it pulls the server sig file and compares it to the local one. If there's a mismatch, the server is updated. From there it manages the signatures locally until they're different.
Writing the sig file to the remote server is done in the same rsync pass because it's stored in the local directory as a dotfile.
I realize rsync does its own checksums, but using my own crude signature files makes it so I don't have to keep calling rsync. I only call it when something changes.
I also have some stuff I'm working on that ties into auto-restarting servers when syncing finishes, rolling server deployments for no downtime, db migrations, etc.