Three Arch Investors is reportedly planning a hedge fund to buy land in California, where the price of homes have fallen by about 20%, and that of land by about 80%, according to Financial News. The firm plans to raise as much as $250 million for its California Distressed Land Fund, managed by David Michelson.

This could be a dangerous game -- if you can't flip the properties quickly, you may be left waiting years (or forever) for the properties to be developable and yield anything. I certainly wouldn't be betting on additional suburban sprawl right now.

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