"You could hear the house burning and the firefighters and chainsaws and stuff. It was all pretty loud."
Wairarapa Bayleys real estate agent Nell Macdonald said the home was a 1930s bungalow that had been listed for sale about a fortnight ago. The property had a rateable value of $255,000.
"The owners are living overseas and we're still trying to contact them."
Masterton Police Detective Senior Sergeant Scott Miller said a scene examination had revealed the fire was deliberately lit and an accelerant used.
He urged anybody who saw any people, vehicles or suspicious activity near the property overnight to contact the police.
"Even if you haven't seen anything, it is most likely the person or persons responsible have told someone what they have done and police want to hear from anyone with information.
Anybody with information can contact Masterton Police at 06 370 0378 or Crimestoppers, anonymously, on 0800 555 111.