Tasmania is building houses faster than it has for a generation.
"There were 701 detached house starts in Tasmania during the March quarter of 2019, which was the state's strongest performance in 25 years," Housing Industry Association executive director Tasmania Stuart Collins said.
"This brings the total number of detached house starts for the year to March 2019 to a level 30 per cent higher than the previous year."
The increase came as Tasmania's accelerating population growth continued to deliver new state population records and availability of rental properties continued to be tight, especially in Hobart.
"After several years of strong population growth, tightening rental vacancies and rapid increases in the cost of renting or purchasing a house, housing construction has responded in a big way," Mr Collins said.
The HIA expects home building activity to remain strong for some time.
"Recent easing of interest rates, income taxes and lending restrictions should also help mitigate the impact of the modest softening we anticipate for the Tasmanian housing market from these elevated levels," Mr Collins said.
"Tasmania has delivered the nation's second strongest housing market behind Victoria, on the back of the strongest interstate and overseas migration figures in the nation and the second strongest detached dwelling market behind New South Wales.
"With the cooling of Victoria's property markets, Tasmania may even take out top place in the coming months."
Building and Construction Minister Elise Archer said reports from the HIA and Master Builders showed the state government's policies aimed at encouraging more Tasmanians to build homes were working.
"We will continue to put in place the right conditions to support the sector and ensure these great outcomes continue well into the future," Ms Archer said.