Australia's dwelling markets remained busy a month before Christmas, with the latest sales data showing a surge in take-ups, according to the Housing Industry Association (HIA).

Over the three months to November, sales activity increased by 41.1% from the same period last year. On a monthly basis, new home sales increased by 15.2%, hitting a decade high.

The five major Australian states tracked by the HIA reported substantial annual increases in new homes sales from the same period last year.

Western Australia was the standout performer, hitting gains of 108.8%. South Australia followed, recording new home sales growth of 57.6%. Gains were also reported in Queensland (34%), Victoria (22.2%), New South Wales (20.7%).

These gains precede the extension of the HomeBuilder scheme, which was announced at the end of November.

"The extension of HomeBuilder should see strong sales of new homes reach into 2021," said Angela Lillicrap, economist at the HIA.

However, Lillicrap said while the HomeBuilder has been an essential factor that improved market confidence, it is not the only growth driver for new home sales.

"Low interest rates, house price growth and a change in consumer preferences away from apartment style living, have all seen demand for detached housing rise. Many households have diverted their expenditure from travel and entertainment towards housing, including renovating their home," she said.