A photo of the razed property shows the only thing that was spared in the blaze was a pile of freshly chopped fire wood stacked next to the charred ruins.
To add to the tragedy, one of the family's three hunting dogs perished in the blaze.
The blaze reportedly broke out around 3.40am, with the noise and smoke waking up a number of Totara Terrace residents, who called emergency services.
One of the homes burnt completely and the other one, on the same section, was also damaged by the fire. It is not yet known whether the house will be liveable.
The local community has been quick to post offers of help on social media, trying to reach out to the family who has lost everything.
School uniforms, food, clothing, bedding and other items have been offered and a fundraiser has been started to try to help the family who, according to a close friend, is still in shock.
At least one local café has also set up a cash donation point, with all proceeds going to the family.
A Givealittle page has also been set up, raising funds to help the family. Anyone who can help with a donation is being asked to do so via the fundraising page.
The family is staying with relatives in town and, according to Tawna Woods, who set up the fundraiser, they are still in shock.
"They're in shock, they're going to have to take it as it comes for the next little while," Woods said.
Her child was one of the minors who escaped the fire, and she said the family woke up with the smoke filling up the rooms, and managed to escape the house just as the flames began to engulf it.
She said the response from the community has been incredible, with everyone stepping up with offers of help for the family.
By the time she set up her fundraiser, offers of help were already multiplying.
"It just goes to show how much support and love there is in this town. We are very blessed to live in such a caring community," Woods added.
Four fire crews - from Wānaka, Luggate and Lake Hāwea, as well as a command unit from Alexandra, attended the fire.
A spokesperson for Fire and Emergency New Zealand said the cause of the fire was still being investigated.