California's tortured real estate market has brought heartbreak and ruin, but some investors, speculators and first-time home buyers are also dreaming big and finding opportunities -- a silver lining in the Golden State's epic housing crash.

For many young couples, plummeting prices and near record-low interest rates make it possible to own a home in California for the first time.

Investors and real estate speculators, meanwhile, can snap up foreclosed properties on the cheap to sell during the next boom in California's boom-and-bust real estate cycle, a boom they believe is inevitable and possibly not far off.

"This is the buying opportunity of our lifetime," said Bruce Norris, who heads an investment group that expects to purchase some 100 homes this year in Southern California's Inland Empire region.

California -- which would be the world's eighth largest economy if it were a country -- saw a near-doubling in home sales in the fourth quarter, a pace surpassed only by Nevada's 133.7 percent growth.

But experts warn it's a dangerous game to play when nobody is really sure how low home prices will go or when they will rebound as the recession lingers, jobs dry up and residents pour out of the state in search of better prospects.

Norris concentrates on the Inland Empire of Southern California, made up mostly of Riverside and San Bernardino counties, one of the fastest-growing areas of the country during the housing boom, driven partly by immigrant families who couldn't afford pricier coastal cities.

It's now one of the hardest-hit. In the past 18 months, the median home price in Riverside and San Bernardino, pummeled by the subprime meltdown and now recording some of the highest foreclosure rates in the state, has plummeted 55 percent.

Norris Investment Group looks for homes built between 1980 and 1990, typically under 2,000 square feet (186 sq metres). Older houses come with too many maintenance "surprises," Norris says, and larger places can be tough to sell or rent in hard times.

Last month the group paid $55,000 for a foreclosed home that was worth $360,000 at the top of the market. Norris expects to spend $30,000 on repairs and rent it for $1,200 a month until the market turns around.

The group also hopes to minimize risk by owning the homes free and clear, thus accruing little debt.

"You cannot have this (low) level of pricing be permanent because it costs too much to build a home here," Norris said. "That's how you know you're making a logical decision when everything is falling around you. When you can buy a finished product someone will want to live in for $55,000, that just has to make somebody pretty wealthy someday."

'DARK MOMENTS'

Experts agree California home prices will ultimately rebound but caution that real estate investing in this economy -- the worst contraction since 1982 -- should not be undertaken by amateurs or the faint of heart.

"You have to have a pretty strong feeling about where this is all going," Stuart Gabriel, director of the Ziman Center for Real Estate at the University of California, Los Angeles, told Reuters. "This cycle is so different from prior cycles that it's very difficult to extrapolate."

"Most would argue that California is not going into the sea," he said. "On the other hand it's not totally out of the question that this particular period of weakness could extend for a while, and that means multiple years."

California's roller-coaster real estate cycles can be traced to the 1970s, when home prices tripled, ignited in part by foreign investment and the end of the gold standard following decades of explosive population growth.

Home prices plunged in the early 1980s, turned around and doubled within 10 years, slumped in the mid-1990s and then blasted off again at the end of the decade. The subprime meltdown and recession pushed them back off the cliff.

"It's a great time to buy for people who are willing to risk a little more and be optimistic when everybody else is doom and gloom," said Daren Blomquist, marketing and communications manager for RealtyTrac, an online foreclosure data service.

But he warned: "They will probably have to wait it out, possibly for several years."

Chris Twoomey and his wife Jennifer illustrate the risk underlying the perceived opportunities. They moved to California from the Midwest in 2004 to pursue acting careers and had just begun to think the dream of home ownership was out of reach when the crash came and they saw their chance.

The couple pounced in January, right after Jennifer, 39, learned she was pregnant with their first child, making an offer on a small, bank-owned home in suburban Los Angeles.

But the day after the Twoomeys' offer was accepted, Chris was called into the cafeteria at his job in a cosmetics company warehouse and laid off.

"Sometimes in our dark moments we sit around and say to ourselves, 'Look, forget the acting, forget everything, this is the time to bail' (from California). We can be doing this someplace else that's still warm but doesn't cost as much," Chris told Reuters in an interview.

"But we're sticking it out," he said. "It's perverse, but something inside of us does want to stay here. It's sort of a belief that because it is Southern California and because it is the kind of place where everybody wants to be, it will come back eventually."