Her 2010 novel The Hut Builder is one of New Zealand Booksellers' top 20 books of the decade.
The author said her two-week stay at the converted villa owned by Bryce Smith and Sue Cooke provided her with a very good working environment.
"I was relaxed, productive and the company was great.
"It enabled me to complete the second stage of the book and I aim to get the third and final stage completed by March."
Fearnley has been the fifth artist to take up residency at Glasgow St following a painter, a potter, a sculptor, a multi-media artist and Rotorua painter and sculptor Sarah Zeissen is about to take up a six-week residency.
The Glasgow St centre houses the Rayner Brothers Gallery, Gallery 85, artists' studios and Nevanah Turner opened his Cuban Belle Cafe on site in May.
Current exhibitions are Mark Rayner's Mystery Box and Gallery 85 is showing paintings by Walter Kirby. Both exhibitions are open for viewing from 11am to 3pm Wednesday to Saturday until November 17.