Neighboring country Canada picks up on home sales and stabilizes home prices.

Last Wednesday, Canadian Real Estate Association revealed an average of $324,928 for Canadian home prices in August. This is equal to the home prices achieved for the same month in 2009. The average yearly price in two-thirds of the cities tracked by CREA has either increased or remained the same; the monthly average, however, is slightly lower than the $330,351 average selling price in July 2010.

August is the third consecutive month where average sale process declined; this is following last year’s rapid pace.

CREA’s Multiple Listings Service showed a more than 200% difference between new listings and sales. Generally, a 2-1 ratio is viewed as balanced, noted BMO economist Doug Porter.

George Pahud, CREA’s president, said, “Rising interest rates and a projected slowdown in job growth mean that the Canadian housing market is expected to continue to cool.”

Sales activity was 4.1% higher in August compared to the previous month. Since March, this is the first monthly increase and since the start of the year, only the second. In both Ontario and British Columbia, the activity remains increasing and accounts for most of the national sales activity improvements.

Inventory, which describes the length of time needed to sell housing stock, was also down in August. MLS Listings showed a 1.9% increase from July to August, causing inventory to be pushed back from seven months in July to 6.9 months in August.

Even with the increased home sales and stabilized prices, CREA still warns of a negative yearly comparison. Late 2009 saw an abnormally active real estate market in Canada due to low interest rates.