Marc deBaptiste, principal for Apartment Realty Advisors, sounded more like a doctor than a broker at the "Healing Hands" session at the 2008 Multifamily Executive Conference in Las Vegas when he was describing the differences between sprains, fractures, and compound fractures. He wasn't talking about a leg injury. He was describing the ailments afflicting bad condo deals.

Those with a sprain were zero to 15 percent sold out; those that were fractured were 15 percent to 50 percent sold; and those with a compound fracture were more than 50 percent sold. But why would properties with more condos be in more critical condition than those that with more sitting on the market? Because they're harder for apartment owners to revert back into rentals.

Rental operators taking over these buildings seem to agree on one thing: You have to have control of more than 50 percent of the units. In other words, you need to avoid compound fractures.

"By having 50 percent, you have control of the condo association," Baird says. If you do have a lot of owners in a building, there are some ways to entice them to sell.

David Baird, national director of multifamily for Sperry Van Ness, has this project in Phoenix, for instance, where an apartment owner moved the condo buyers in one building and the renters into a separate one in a fracture deal. "The rest of the project can be cordoned off," Baird says.

Signature Homes, a builder in Las Vegas, is attempting to move its condo buyers into its vacant single-family inventory, while filling the formerly-owned condo units with renters. In other cases, a building's owner will try to buy out the buyers.

But everyone has an appetite for these deals, though. It's easy to see why. Looking for ways to relocate owners while keeping an association in check isn't often worth the money or time. "We wouldn't have an appetite for a fractured condo," said Brad Broyhill, president and COO of Simpson Housing.

But deBaptiste says there is value in fractured deals. Bulk buyers can get huge discounts ranging from 45 percent to 65 percent off of the last unit sold in these deals. Often, these buyers plan to hold for two to four years. "You're making your money on the buy," he says.