Police said the driver of the BMW was overtaking a Mazda on Aitken Boulevard at Roxburgh Park when he lost control and hit a pole about 11pm on Monday.

The car then careered into the parked cars and the block of townhouses on Korab Place, while residents were asleep inside.

The BMW flipped onto its roof, before coming to a stop beneath the partially collapsed roof of a garage.

The incredible force of the impact took out the front brick walls of at least two townhouses and a garage, leaving the wooden framework and insulation exposed.

Dozens of people ran out of their homes to see what had happened after hearing what they described as an explosion and an earthquake.

A man who lives in the complex said he was sitting in his garage with his fiance when the car crashed into the block.

"I saw smoke, glass was everywhere," he said.

"I saw the car was smoking and I thought it might explode so I was trying to push everyone out."

He said the crash scene was "unbelievable", adding it looked as though the "BMW came from the sky".

Some residents reportedly ran from their homes bearing baseball bats and others called for a gun to stop the two occupants of the BMW from fleeing.

Two men from Greenvale were arrested at the scene, but have been released pending further inquiries.

The Mazda also hit the light pole, but the two women in the car were not injured.

Daylight revealed the extent of the carnage at the scene on Tuesday morning.

The complex's car park was likened to a bomb scene, with debris from the damaged cars and townhouses scattered across it.

Sergeant Mick Free has told Seven News the scene was a mess.

"We have three units which people won't be able to go into," Sergeant Free said.

"We have got no less than five cars damaged, a couple of those beyond repair."

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