He says national lenders aren't providing as much debt as they were a year ago, which means developers need to put in 25% more in equity, which makes apartments a less attractive investment.

Also, the softening economy means fewer people moving from out of state, fewer people moving to more expensive apartments, and more people seeking roommates, he says.

''We're going from a great apartment market to a good apartment market,'' Hawks says. ''That's a positive for the market. A lot of cities are going from a good market to a bad market, or at least a below-average market.''

Roger Reinhardt, executive vice president of the Denver HBA, tells GlobeSt.com he expects that by the end of the year, enough multifamily permits will have been pulled to meet the existing demand.

The townhome and condo market also soared in the first half of the year, with 3,019 permits being pulled compared with 1,526 last year.

As with apartments, most of the activity is in Denver, not the suburbs.

There were 1,015 permits pulled in Denver, about a third of the total activity. A year ago, only 60 permits were issued through June.

Developer Mark Taylor, whose National Properties is developing condos and townhomes in Lowery, notes that last year's activity probably was stronger than the June figure reflect.

''I'm surprised there were only 60 permits last year,'' Taylor says. ''We pulled 108 ourselves, but we pulled them in July.''

In any case, he says that the condo market still reflects a ''miniscule'' percentage of the total housing units in the market.

''We don't need to sell 20,000 units a year,'' Taylor says. In the suburbs, condos are seen as a less expensive alternative to single-family homes, but in the city they're a lifestyle choice, he says.

''One thing people overlook is the time of commuting,'' Taylor tells GlobeSt.com ''When you buy an urban loft, you might be 15 minutes or less to work, compared with 45 minutes in the suburbs. You regain an hour or more of your day, not to mention all of the wear and tear on your car and the stress of the drive. That's only going to get worse when T-Rex (the massive widening of I-25 and addition of light rail) begins later this year.''