Canadians paid 7.7 per cent more for sales of existing homes in August than they did in the same month last year, a real estate group said Thursday.

In its monthly report, the Canadian Real Estate Association said the average sale price for an existing home rose to  $349,916 last month from $324,992 in August 2010.

CREA president Gary Morse said the market remained on a "firm footing in August when compared to volatile financial markets."

CREA said the national average price has actually moderated compared to earlier this year, with Vancouver's sales activity — and more recently Toronto's — exerting less influence on the average. Vancouver and Toronto's share of provincial and national sales activity reached "unusually elevated" levels earlier this year, but has since pulled back into normal seasonal variations, the group said.

"Once again, economic and financial market headwinds outside Canada are keeping interest rates lower for longer," said CREA chief economist Gregory Klump. "Those headwinds will likely persist until, and indeed after, fiscal quagmires in the U.S. and Europe are resolved. In the meantime, the Bank of Canada will have ample reason to delay raising interest rates further, which is supportive for the Canadian housing market."

Nationally, overall year-over-year sales for August were up 15.8 per cent, the largest year-over-year increase since last April, CREA said, but added that the big increase was mainly due to weak activity in 2010.

Between July 2011 and August 2011, sales eased by a seasonally adjusted 0.5 per cent.

The real estate group also said that a record 70 per cent of all local markets across the country are considered to be in balance. CREA says a market is considered to be in balance when the seasonally adjusted ratio of sales to new listings is between 40 and 60 per cent. Below 40 per cent is considered a buyers' market, while over 60 per cent is considered a sellers' market .

CREA also said the number of months of inventory on the market stood at 6.2 months at the end of August on a national basis. That was relatively unchanged from the 6.1 months seen at the end of July. National inventory figures have been stable at about six months since April. Inventory — a gauge of market health — refers to how long it would take to sell of the current supply of houses on the market at the current rate of sales.

Economists said housing markets remain healthy for now despite tumbling consumer confidence and weak global growth.

"Extremely low interest rates appear to be just the medicine as Canadians continue to borrow, and a number of the banks lowered their five-year fixed rates again in recent days, which could continue to lend support," BMO Financial Group economist Robert Kavcic wrote in a commentary.

However, some observers said the market is eventually headed for a drop.

Fannie Fong of TD Economics said a peak-to-trough drop of roughly 10 per cent for both home sales and prices is expected, though that change isn't expected until the Bank of Canada begins hiking interest rates in earnest in early 2013.