Tasmania Fire Service crews from Rocherlea and Launceston were called to the blaze shortly before 9pm after neighbours reported a fire in an external building on the Galvin Street property.

The home's male occupant is reportedly interstate and police were last night seeking to locate him and inform him of the damage.

The building, believed to be a converted shed, was fully engulfed by flames when the TFS crews arrived, but station officer Rick Mahnken said firefighters wearing breathing apparatus were able to extinguish the flames within 10 minutes.

Neighbours watched on from the street as the emergency services crews worked to gain access to the outbuilding to determine the source of the fire.

The building was very close to both the home on the same property and the neighbouring house, but both main structures escaped undamaged.

The shed appeared to have been destroyed but the likely bill is yet to be assessed.