All 48 passengers and crew, plus one person on the ground, have been killed after a commuter plane plunged into a house near New York and burst into a fireball.

Continental Connection flight 3407 crashed at 10.20pm (0320 GMT) last night in the town of Clarence, about five minutes before it was due to land at Buffalo, in New York state.

The plane – a Bombardier Dash 8 Q400 operated by Virginia-based Colgan Air – was flying from Newark Liberty International Airport in New Jersey to Buffalo Niagara International Airport in light snow, fog and 17mph (27 kph) of winds.

It plunged into the property, in what firefighters described as a "direct hit", bursting into a fireball and killing everyone on board.

Dave Bissonette, the Clarence emergency control director, said that the crash killed one person in the house but that two somehow managed to flee the scene. They managed to escape the scene with minor injuries.

"It landed on the house, clearly a direct hit," he said. "It is remarkable that it is only one house. It could easily have wiped out the entire neighbourhood."

Of firefighters arriving at the scene, he said: "I can only imagine that those first arriving units found a fireball."

The cause of the crash remained a mystery this morning, with Buffalo air traffic control's radio messages – captured on the web – recording no apparent concern that anything was out of the ordinary in the final seconds before the crash.

According to the recordings, the plane's female pilot is asked to fly at 2,300ft after reporting her position normally to local air traffic control. A minute later, her flight disappears from radar screens.

The controller tries to contact the plane but hears no response. He then tried to contact the pilot again, and asks the pilot of a nearby Delta Air Lines plane to see whether he can see the Continental flight.

"We need to find out if anything's on the ground. This aircraft was five miles out, all of a sudden we have no response from that aircraft. All I can tell you is that we had an aircraft over the marker, and we're not talking to him now," the controller said.

Later, he tells all aircraft monitoring the same frequency: "We did have a Dash-8 over the marker that didn't make the airport."

Residents of Clarence – an affluent area with set-back, detached houses located around 10 miles from the airport – reported hearing the sound of a groaning, spluttering sound and then a massive bang.

Those looking outside could see flames climbing to between 50ft to 100ft high in the night's sky and a pile of rubble on the ground.

One person who heard the crash from about three-quarters of a mile away said it sounded like an earthquake.

"It was almost like on TV where you hear this high pitched sound. It was like an earthquake. You could feel it," the witness, Keith Burtis, told MSNBC. "I'm downwind from it and the smoke and smell is still pretty strong." He said the accident site was a populated area on the edge of farmland.

Another local resident, Bob Dworak, said: “The whole sky was lit up orange. All the sudden, there was a big bang, and the house shook.”

Local emergency services this morning declared what was described as a limited state of emergency, with police completely closing off an area covering several blocks around the crash site.

Mr Bissonette said that the crash scene was, as yet, too hot to begin recovering survivors or carrying out serious investigations on the ground. Firefighters were still working on quelling the fire, he said, and investigations - including removing the bodies, and personal items relating to the dead - were unlikely to start today.

Laurie Bennett, of the FBI's Buffalo division, said that investigators were steering clear of the scene at present and allowing firefighters to do their work. Later, she said, they would enter the scene and collect the "loved ones that were lost and their personal effects".

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