Police are investigating the cause of a fire that gutted an empty house in Canning Street, Launceston, early Friday morning, a police spokesperson confirmed.
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The blaze began at approximately 12.50 am on Friday, engulfing a shed at the rear of 87 Canning Street, before spreading to the main house some time after.
Next door neighbour, Launceston car dealer Akhil Khattar, said he was awakened by police knocking on his door.
"The police were patrolling around and saw the smoke, and then just woke us up, they were knocking, we were scared, and they told us to empty the house and just leave everything behind, just save your life," Mr Khattar said.
"We were just standing out there, and yeah we saw like a huge blaze of fire coming out."
Mr Khattar said over the past two months, people have occasionally squatted at the empty house, usually on weekends.
"In the night time, usually around 12.30-1am, it happens not every day, normally on the weekends ... I can hear them in there walking around and talking drinking and, you know, smashing bottles."
Firefighting crews from both Launceston and Rocherlea attended the scene early on Friday morning.
The house was one of a group of seven adjacent properties that are the subject of a development application to the Launceston Council.
According to a Tasmanian Fire Service spokesperson, the cause of the fire could not be determined until after daylight.