How do you and/or your team develop your web applications? Language, framework or platform doesn't matter. I would like to know about the structure of your environment.

For example:

1. Using IDE on workstation and project files on remote host accessing via sftp. Files are saved instantly on remote host;
2. All files are local and are uploaded on remote host during saving;
3. Files are local, web server is running on local computer and is tested at local host. etc.

You could write down also about the benefits of your approach, this will be useful for me. Thanks

upd: Here must be a question and here it is: which is the best approach by your opinion?