Four adults and three children fled their burning home in Whangarei as a fire destroyed the two-storey building and damaged an adjoining flat.
Fire safety officer Craig Bain said the fire was probably started in the lounge by children playing with a lighter under a hut they had made using a foam mattress, which would have quickly caught alight, spreading flames.
Police, St John ambulance and firefighter personnel were at the William Jones Dr Housing New Zealand flat shortly after the alarm was raised about 1.15pm yesterday.
Residents from nearby homes lined the street and watched as firefighters quickly got the blaze under control.
However, the house was extensively damaged and the fire destroyed everything on each of the floors.