He said police were right behind the vehicle.
The car went through a small garden before hitting the house about 20m away.
Another neighbour who rushed over to the scene said the woman, who had been asleep, was "very shaken''.
"If she had been sitting in her lounge watching television she would be gone now,'' she said.
"We could not get her out, there was bricks and other stuff from the house piled up against the door.
"She was getting really stressed out. We tried to get her out the window but couldn't. The police moved some of the stuff against the door and got her out.''
The driver had been charged with an number of offences including drink driving.
A police spokesman said the car was not being pursued by police and the car crashed shortly after passing a police vehicle.
- GISBORNE HERALD