Maybe—at least for now.

But that depends upon how you interpret recent real estate trends and statistics from several different sources. A Feb. 9 report from the federal government said that one out of four American homeowners are under water on their mortgages, making refinancing either difficult or impossible and increasing the chances of foreclosure. Many former homeowners have already fled to the rental market, escalating demand and hiking rents in urban areas.

An end-of-year report from the Colorado Division of Housing shows that apartment vacancy rates in metro Denver hit their lowest mark in over a decade and rents have climbed accordingly. Vacancy rates dropped to 5.4% in the fourth quarter of 2011, the lowest since 2000, when they reached 4.7%. At the same time, average rents in Denver last year spiked 2.8% to $870 a month.

Clearly, demand for apartments is high and the supply is struggling to catch up. The “Emerging Trends in Real Estate 2012” report from the Urban Land Institute says to “expect high-rise and mid-rise projects to mushroom in many markets across the country in 2012…a lot of multifamily units will get built.” Apartment Realty Advisors, Denver, estimates that nearly 4,300 units are already under construction in the metro area, with an additional 7,000 units in the design and proposal stages.

The CU Boulder Leeds School of Business says in its 2012 Business Economic Outlook that new multifamily permits should total about 4,000 this year, nearly all in rental units. The increase is heavily urban centered, with less multifamily activity in the suburbs and even less in the mountain resort towns, where, the Outlook says, “the value per unit of multifamily housing declined in 2011, to about $100,000 per unit,” on average. The “shadow market” of single-family homes and condos will also serve to keep new homebuilding in check and boost rentals, the report adds.

However, apartment developers need to get into the rental market early, ULI warns, “before lenders start questioning the demand for all the new units.”

In Denver, the bulk of new rental units won’t come on line this year, with exception of a few properties like the recently completed 1099 Osage in the city’s Lincoln Park neighborhood (100 units). Still, with an estimated 6,000 new rental units scheduled to hit the Denver market by 2016, there is some danger of overbuilding, especially downtown, where office and retail development will have to scramble to match the supply with new demand.

“If the economy picks up, renter interest could intensify further from people doubling up or young adults living at home but looking for their own space,” ULI says.

That means for now—and likely for the foreseeable future—the multifamily rental market is the safest bet in town.