Act now! 10 major housing markets with the shortest supply of homes

Denver

Decline in inventory: 42%

This mountain-high city never experienced the highs and lows in home values that its coastal counterparts did. And now, with rents rising and vacancy of just 2%, more apartment-dwellers are taking the plunge into homeownership, local broker Gary Bauer says.

This city's inventory in February was down 42% from the same period a year earlier, at just 10,086 units. The number of homes going under contract spiked 19% between January and February of this year as buyers raced to take advantage of low interest rates and relatively low prices.

"I'm not sure what magic thing happened in January, but buyers really came out," Bauer says.

Prices aren't falling as they are in many other markets, according to Metrolist. The average home price of $270,821 was up 2% from February 2011. Bauer says March looks to be another record month.