Balclutha Volunteer Fire Brigade chief fire officer Graeme Ferguson said the fire in a room at the back of the house was well involved when emergency services arrived shortly before 2pm.
"The smoke was really going to town and coming out the windows. It was a real good save."
No-one was in the house at the time of the fire.
About 16 firefighters attended, and managed to contain the blaze to one room believed to be an office.
The cause of the fire was not yet known, although it was possibly electrical as it started in an office area.
Police and firefighters closed the Yarmouth St/Essex St intersection for about an hour.
One woman told the Otago Daily Times neighbours saw smoke coming from the house and knocked on the door to check no-one was inside, while others called emergency services.
"There was one hell of a noise when the windows exploded," she said.
Neighbours praised fire services for their speedy arrival, and successful efforts in saving most of the house.
