"We’re currently working with the Australian Centre for Visual Technologies on a version of an Augmented Reality version of Videotrace that you can use while walking around. The idea is that you’d use a camera as a modelling tool. You would then walk around a city, modelling it as you go. Good progress is being made towards this goal, with a prototype system in the making."
Google Tech Talk about it: http://www.youtube.com/watch?v=YEM-XAeY4K0
Reference: http://www.acvt.com.au/research/videotrace/