Melbourne family lucky to be alive after fire guts entire house

A family of four had a lucky escape after their three-storey home was destroyed by fire overnight in North Warrandyte, north east of Melbourne.

Country Fire Authority crews arrived at around 5.30am and attempted to contain the fire sparked by embers from an open fireplace.

Moments after the blaze took hold, a couple and their two teenage children fled the property, along with their dog.

Neighbours were woken by the noise, telling 9NEWS they heard "loud bangs and voice screaming".

Residents were initially concerned the fire could threaten neighbouring homes, but the CFA managed to contain the blaze.

A man was taken to hospital with burns to his hand.

Later today it became clear to fire investigators the house had been completely destroyed, along with the entire contents.

"They were very, very lucky to get away with unfortunately nothing but they got away with their lives so that's the important part about it," CFA Captain Mick Keating said.

The CFA said with winter approaching it was time for residents to ensure smoke alarms are working, and check chimneys and fireplaces are protected and well-maintained.