Judges favoured the Fourth St house because of its "great use of space" and because it was an "interactive display".

Mrs Bones wins a hardware voucher.

The Best Business Window category went to Hepburn General Store.

Operators Arlene and Glenn Malone said they were surprised to be chosen as winners.

"We just tried to recreate Santa's Workshop. We enjoy decorating the shop, it gives a lot of joy to children. And there was a lot of older people enjoying it this year too," Mrs Malone said.

Mrs Malone said her daughter Angie was the brains behind the design, which has won the family a voucher from Jenkin and Thomas Retravision.

Hepburn General Store is at 102 Main Rd Hepburn Springs.

The second best residence award went to seasoned participants Ken and Merle Rea at 18 Golf Links Rd Hepburn Springs. Daylesford Rotary Club's Ian Esmore said an honourable mention went to the Francis Family, Napier St

Creswick.

"And Ron Ryan's house at 19 Ellis Rd Coomoora is also worth a look. It's a great use of space in a large front yard, landscaped with walk around features and Christmas scenes," Mr Esmore said.