Newbie question about Condo Conversions in FL

[Sean Clark]

Hello everyone! I am a somewhat new investor currently residing in Ohio where I bought my first foreclosure home. I am looking at investing in a property or two in Florida and am hoping that someone who is familiar with condo conversions, or just the South Florida real estate market in general can help me here. I am looking into purchasing some condo conversions in the broward county area in Pompano Beach FL. However, I am skeptical to say the least after seeing some of the rediculous prices these condos are going for. One of them had sold for $147,000 in 2006 and just listed for $39,000. Recently I have been reading about entire complexes going under because of insufficient funds to keep the complex afloat. If I do purchase, am I at risk of losing everything? Is resale value on these types of units not predicted to go up in the future? It just seems like its too good to be true, there has to be a catch? Would anyone here recommend investing in something like this? Any help would be greatly appreciated! Thanks in advance!!!!

[Rich Weese]

There are other tricks that many of the condo converters used. I was in contract to buy The Green Tee condos on the side of FT. Myers country club in FL. There were originally 123 units and and 27 units "sold" back in 2006. The avg sale was 150K. I was buying the remaining 96 for 34K per door.
When I pulled the county tax rolls to check owners of the 27, there were 21 that were either a CORP or LLC with the same signator and many of the other units were owned by people with the same surnames as the selling partners! THey had just salted the deal, by buying from themselves at inflated prices. I would not go near a conversion in FL currently, and I live there. It would be suicide for an out of stater, imo. Rich