SEATTLE - It was a hot trend in the Seattle-area housing market.

Nearly 17,000 apartment units were converted to condominiums, according to market analyst Dupre and Scott.

But now the American dream is coming apart at the seams for many of those buyers.

The glow of owning his first home dimmed quickly for Jeff Moberley, of Des Moines.

Video: Investigators: Converted condos could be crumbling

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On home video he and his wife documented their new condo's rapid slide into disrepair. They recorded new kitchen cabinets improperly fastened, countertops cracked and separating, and – hidden until now -- a pipe punctured with 14 wall screws, leaking the worst kind of water.

"Sewage water from the toilet," Jeff Moberley said.

Sewage flows out every time they flush their upstairs toilet. Other rooms have serious problems too, and the Moberleys say their repair bill is $20,000 and counting.

"It's the money, you know," Debbie Moberley said. "We work hard and it was our first home."

The Moberleys live in a former apartment complex rehabbed and converted into condominiums.

Condo conversions soared in our area until the market cooled last year.

The boom was driven by low-interest loans that turned renters into homebuyers. Enterprising developers started snatching up old apartment buildings and often made a tidy profit quickly converting them to condos.

But at dozens of complexes, home ownership has turned to financial hardship.

Through civil court records we identified nearly two dozen condo conversions where homeowner associations have sued developers for millions in damages.

KING

Mark Jobe, building expert, says rot behind the wall is a common problem at condo conversions. He showed us this window, which was set on shredded wood.

Seattle law firms that specialize in the field tell us that construction defects at conversions are a fast growing part of their caseload and investigations at many more condo complexes are under way.

Condo conversion expert Mark Jobe took us along on one investigation. He revealed damage that's not always as obvious as at the Moberleys' home.

He says rot behind the wall is a costly and common problem at conversions because apartments built before the 1990s are notorious for their poor protection against northwest rainfall.

Water feeds the rot that causes serious structural damage. It may be undetected by the builder or covered up.

Jobe showed us where a new window was set on shredded wood. He says the damage wasn't disclosed to the buyer of the half million dollar condo.

"To have done the repairs, you had to find the rot," Jobe said.

Jobe's firm specializes in conversion inspections and says the average cost of repairs is more than $30,000 per unit.

"I've inspected hundreds and hundreds of units and all of them have had very significant financial problems," Jobe said.

Builder's attorney Joe McCarthy of Stoel Rives argues most conversions are sound, built by reputable developers who supported laws that now require more in-depth building inspections to find rot and other defects.

"They're not all bad," he said. "Condo conversions have served a great purpose."

He thinks most of the problems come from short-sighted developers.

"There were some folks who got into the business because it was hot, without a lot of prior experience," McCarthy said.

KING

Building expert Mark Jobe says apartments built before the 1990s are notorious for their poor protection against northwest rainfall, resulting in rot and serious damage.

Olympic Investors, on the Seattle waterfront, is a big-time player with 10,000 apartment and hotel units nationwide. Tax records show it flipped the Moberleys' 143-unit complex into condos, earning twice what it paid.

Although Olympic repaired some of the damage, it recently sent the Moberleys a letter contending their one-year warranty expired.

Olympic's director, Blaus Puzon, turned down KING 5's repeated requests for an interview.

Puzon wouldn't explain why his real estate savvy company misstated the law, which clearly warrants new construction like the Moberleys' cabinets and countertops -- for not one -- but four years.

"They're sitting there on a pile of money - they don't want to help us," Debbie Moberley said. "How can they keep that money and be proud of what they did?"

By phone, Olympic told the KING 5 Investigators it is trying to work with the Moberleys to resolve these problems.

What if you live in a converted condo or are thinking about buying one? Experts say you will definitely want a specialized inspector, called a building envelope inspector, to examine the condo.