Seven fire crews were called to the property on State Highway 2 near Snodgrass Rd about 11.30am on Thursday. Ōmokoroa fire chief Ian Blunt said the fire appeared to have started in a double garage and spread to the family home.
The cause of the fire which destroyed the double garage and extensively damaged the neighbouring home was under investigation, he said.
Fire crews were expected to be at the scene for two or three more hours dampening down hotspots, and helping the fire investigator with their inquiries, Blunt said.
It was unknown whether either structure had working smoke alarms, he said.
"But working smoke alarms do save lives."
A police spokeswoman said police had also been sent to the scene.
An onlooker in Te Puna told the Bay of Plenty Times there were "huge thick black clouds" of smoke and it was "just going and going".
The smoke could be seen from Mount Maunganui, a motorist said.
Property owner Sean Lett, who was attending a conference in Taupō, told the Bay of Plenty Times he was just grateful that no one was hurt.
The rental tenants were a mother, who had been at work and her daughter who was at school when the fire broke out, he said.
Lett said he was not surprised the double shed went up so quickly because it contained tractors and was also full of petrol and diesel cans, including a 1000-litre container of diesel.
"Not only was the garage gutted, but despite Bluntie and the other firefighters, who are legends, doing their utmost to try to save the rental block, it's a bulldozer job," he said.
Lett said although he had property insurance, he did not know whether his tenants had contents insurance cover, but regardless they would need lots of support.
"I have already received several texts offering the mother and daughter support, which again shows that the community out here are just outstanding people."
The cause of the fire was still under investigation.