With three months behind us in 2017, we are beginning to recognize a shift toward normalization in home-price appreciation across most of Northern Colorado. With the notable exception of Estes Park (more on that later), average price increases have stopped short of 10 percent through the first quarter for the rest of the region’s submarkets.

Compared with the first quarter of 2016, average price appreciation is 7.4 percent regionwide. Last year at this time, the regional average increase was 10.9 percent. The Greeley-Evans submarket comes close to the double-digit threshold at 9.6 percent. Otherwise, we see Windsor-Severance at 2.3 percent, Fort Collins-Wellington-Timnath at 5.5 percent and Loveland-Berthoud at 5.9 percent. The collective submarket of smaller Weld County towns, which includes Ault, Eaton, Johnstown and Milliken, saw a 5.4 percent price appreciation.

Estes Park is the outlier. We’ve seen average prices there soar by 27.4 percent when compared with the end of the first quarter of 2016. In dollars, that’s an average increase of nearly $100,000 per sale. With only 60 closings during the quarter in Estes Park, we know that averages can be heavily influenced by a small number of high-end sales. Nevertheless, it bears watching to see if this steep price spike will continue in the Estes Valley this year.

So, what’s contributing to the broader calming effect on prices in Northern Colorado? The answers aren’t all in, but we can say, in the case of the Windsor-Severance submarket, that new construction is increasing the availability of affordably priced housing. We can also say this: If you think lower demand will be a factor in keeping prices down, think again. It’s still a safe bet that that the total number of home sales across the region will increase in 2017.

In addition to the slowing pace of prices, here are some noteworthy highlights in the local real estate market for the first quarter of 2017:

• Lack of housing inventory in Northern Colorado remains a major factor for buyers and sellers alike. We’re also seeing a slim supply of permit-ready housing lots in the region. Based on a report by Metrostudy, the supply of lots that are ready for construction is 5.5 months. Considering that it takes two years to bring lots to market, that means a 24-month supply would be considered equilibrium. If you’re looking for reasons that price appreciation could move back above double-digit rates, this one could make a difference.

• While quick sales and multiple offers seem commonplace in the local market, that’s not the case in the high-end market. At The Group Inc., for example, we sold 114 homes in the last week of March, but only 7 of those — representing just 6.2 percent — were above $700,000. That further reinforces why the opportunity for move-up buyers is the strongest it’s been in decades.

• Speaking of normalization in prices, the apartment market is experiencing a calming trend as well. With apartment construction booming over the past two years, it now seems that we’re reaching the saturation point. CoStar reports that rents are down about 4 percent from a year ago, and that 11 percent of local apartment communities are offering at least one month free as an incentive. CoStar predicts that rents in Fort Collins will resume an upward direction, but at a more modest annual rate of 2.4 percent over the next four years.

Larry Kendall co-founded associate-owned The Group Inc. Real Estate in 1976 and is creator of Ninja Selling. Contact him at 970-229-0700 or via www.thegroupinc.com.