According to the brokers, the average price of a single-family home sold last year jumped to $253,176. In contrast, the average single-family home price in 1995 had been $125,500. That has made it economically feasible for developers to convert apartments into condos to fill buyers' appetites for lower-priced alternatives to homes.

Most of the condo activity has taken place around Downtown, where more than 1,000 converted units had delivered. Many are located in the infill areas, such as Capitol Hill, a neighborhood slightly south and east of Downtown. Capitol Hill is Denver's densest neighborhood and historically has a large number of affordable units. "Buildings have been looked over in the past due to smaller unit size, slim parking ratios and deferred maintenance are being snapped up by aggressive conversion buyers who had no trouble unloading the converted units to eager residential buyers looking to stay under the $175,000 price level," the report notes.

And there's no end in sight, the report concludes. "As restrictions on residential development and immigration continue to fuel the red-hot single-family market, condo conversions will continue to increase, especially around Downtown. This will further diminish the much sought after affordable rental units. Residents of a converted building accustomed to renting are forced to look for new quarters in a tight market at higher rents," according to the brokers' analysis.