"Overbuilding and a high foreclosure rate stymie Denver's housing market, which last year saw a 6.3 percent drop in prices," according to Forbes.com. "Still, area homes are selling, and the vacancy rate, while still at a pro-buyer 3 percent, last year shrunk by 20 percent. The 49 percent drop in construction starts, the 12th largest cut in the country, and 2 percent rise in new jobs, the ninth highest rate in the country, are good news for sellers."

The report ranked each city by its 2007 unsold vacancy rate and how much the market had changed from 2006. It also took into account construction starts, job creation, and the degree to which new conforming loan limits from Freddie Mac and Fannie Mae would improve each market's lending conditions.

San Jose, Calif., topped the list as the best city for home sellers. It was followed, in order, by: San Francisco; Salt Lake City; Austin, Texas; Kansas City, Mo.; San Antonio, Texas; Denver; Providence, R.I.; Charlotte, N.C.; and Seattle.