Residents described hearing the sound of an explosion about 10:20am local time (8:20am AEST) in an incident described as "serious" by New Zealand police.
A house was on fire and police had closed roads and were carrying out evacuations. Fire and Emergency NZ said 50 residents had been evacuated from the area.
Footage of the remains of the house emerged immediately after the explosion, revealing a scene of devastation.
Video shows the roof blown off the house and the walls crumbling, with rubble littering much of the street and debris seen on top of neighbouring houses' roofs.
Smoke is seen rising into the air, while two vehicles are parked in the house's driveway.
'The biggest bang we've ever heard'
James Looyer, who took the footage of the destroyed house, said a huge smoke cloud was looming over the neighbourhood.
He said people raced over to the property and saw residents in need of help. He helped pull fallen debris off of people and helped them get away.
"We're working the street over and we just heard the biggest bang we've ever heard, it felt like an earthquake.
, we pretty much went outside the house we were working in, went down the street and this big smoke cloud was sitting over this house at the back," he told stuff.co.nz.
"You start looking around and all bricks are off the house next door and the garage doors down the road are all blown off.
"We were trying to talk to [the residents there] and they were just stone cold, like they were pretty much deaf, they can't even hear anything.
"I was picking up a couple of ladies and putting them over my shoulders and onto the grass and covering them in blankets."
He says the people at the scene were aged between 50 and maybe 70.
"They couldn't talk, they were in that much shock."
'The house is no longer a house'
An unidentified Christchurch hotel worker told the New Zealand Herald that a sound like an explosion had shaken nearby buildings.
"It was more than an earthquake, you'd think a bomb had gone off," the worker said.
Police did not identify the cause of the incident. A Fire and Emergency Services spokeswoman said a fire investigator was at the scene but did not yet have any official information about the cause.
Local resident Angus Hendry told stuff.co.nz that he heard a "really big explosion".
"I wasn't quite sure what happened, I looked outside, could see all the dust in the air, ran out down the road and I got there … about seven or eight other people were outside. There was just debris everywhere," he said.
He said he went inside the still-burning house to help evacuate people.
"It was just a lot of rubble … the house is no longer a house, it's half a house," he said.
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"They were in, I hope, surprisingly good shape, given the condition of the house. We just got them out, they looked in quite a bit of shock, had burns and stuff.
"The main thing we were asking is how many people were in the house."
He said windows in other houses in the street had been blown out, while garage doors had caved in.
A worker at a nearby camping site said insulation had been "raining down on us".
"We got showered with the pink and yellow batts of the place," Mark Hawken told stuff.co.nz.
Power has been turned off in the area.
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