The apartment vacancy rate in Denver hit a 10-year low in the third-quarter, prompting a spike in rental prices, the Colorado Division of Housing said Thursday. The housing division and the Apartment Association of Metro Denver reached that conclusion after conducting a joint study on rents in the city. The study found that Denver's third-quarter apartment vacancy rate fell to 4.9%, down from 5.3% a year earlier, but up from 4.8% in the second quarter. "Vacancy rates remain near 10-year lows and the vacancy rate has dropped year-over-year for the past eight quarters in a row," said the report's author Ron Throupe, assistant professor of business at the University of Denver. "This is the second-lowest vacancy rate we’ve seen in any quarter since 2001." As vacancy rates declined in the Denver area, rents increased 2.9% from the third-quarter of last year, hitting of $881 per month, compared to a median monthly rent of $856 a year ago. Denver County saw a year-over-year median rent increase of 5.4%, with the median price hitting $853 per month, up from $809 last year. Ryan McMaken, a spokesperson for the Colorado Division of Housing, said demand for apartments has resulted in fewer concessions such as offers for free rent. "Delinquencies are still an issue, though, as renters confront unemployment and declining wages," McMaken said. The demand for apartment units or multifamily dwellings has been well-documented in the past year. In fact, with more families and individuals turning to the rental option, business activity in the multifamily sector is blooming somewhat. The Mortgage Bankers Association recently reported that multifamily lenders upped financing for apartments containing five or more rental units by 31% in 2010. Multifamily lenders increased financing for apartments containing five or more rental units by 31% in 2010, according to the MBA. Write to Kerri Panchuk.