The Commerce Department says new home sales grew 6.6 percent from a month earlier to a seasonally adjusted annual sales pace of 307,000.
Even with the increase, the past five months have been the worst for new home sales on records dating back to 1963.
Augusta did not have growth in September. According to the Greater Augusta Association of Realtors, 376 homes sold in September, compared with 409 sales in August.
Lloyd DeFoor, the president of the association, said the decrease could have to do with the expiration of several federal home buying incentives that encouraged sales earlier this year.
"With those incentives, a lot of people bought," DeFoor said. "Since then it has not leveled back out."
He said potential homeowners are also finding trouble receiving financing for home purchases but that Augusta is healthier than most markets in the U.S.
"You really need to look at what sold and understand very few real estate markets in the country are better than ours," he said. "We're still ahead of most of the country."
The current market is still one of the worst real estate broker Jim Courson has seen in his career.
"I've been in this 40 years, and it's something I've never seen before and no one else has," Courson said of the declining Augusta home sales. "It's just a big mess. There's no other way to put it."
Paul Dales, a U.S. economist with Capital Economics, called the national September home sales encouraging. He said it doesn't change the fact that activity remains at extremely low levels.
"That's unlikely to change for a few years," Dales said.
New home sales have risen 9 percent from the bottom in May but are still down 78 percent from their peak sales pace of nearly 1.4 million homes in July 2005. A healthy sales pace is around 800,000 new homes.
Builders are competing with millions of foreclosures and other distressed properties that show no signs of abating. They are unlikely to ramp up construction until those are cleared away and demand picks up.
High unemployment, tight credit and uncertainty about home prices have kept people from buying homes. Government tax credits propelled the market earlier in the year, but those expired in April.
The September sales figures were driven by a 61 percent monthly surge in the Midwest. Sales grew about 3 percent in the South and Northeast. They fell by nearly 10 percent in the West.
The median sales price was $223,800. That was up 3.3 percent from a year earlier.
The number of unsold new homes on the market fell to 204,000, the lowest since July 1968. At the current sales pace, it would take about eight months to exhaust that supply, compared with a healthy level of about six months.
The industry is suffering the fallout of a massive building boom, in which many homes were sold to speculators. They then resold the homes, often to borrowers who took out risky loans and defaulted. Those unsustainable boom times aren't coming back.
Staff Writer Tracey McManus contributed to this article.