The housing market has reported a boom in the level of construction activity over the first quarter of the year, particularly for the detached segment, according to the latest report from the Housing Industry Association (HIA).

Citing figures from the Australian Bureau of Statistics, the report showed that detached dwelling commencements increased by 40.6% over the three months to March. Over the same period, starts for apartments declined by 22.8%.

"This record volume of home building is not unexpected and is supporting employment across the economy," said Angela Lillicrap, economist at the HIA.

However, Lillicrap said it is crucial to note that the boom in construction activity has presented builders with challenges, including labour and material shortages.

"These constraints are expected to ease going into 2022 as the number of new houses commencing construction slows," she said.

Lillicrap also pointed at the stark difference between the detached and multi-unit markets. In fact, the number of multi-unit starts declined to its lowest level since June 2012.

"The multi-unit market is expected to remain constrained until there is greater certainty surrounding the return of overseas migration," she said.