"Flames were everywhere and the mum was holding a baby and shouting that another child was still in the house," said Shaun Withy, who lives opposite the house.
"The smoke was really bad and the woman eventually had to jump from the window herself."
Mr Withy and another neighbour ran into the burning house and rescued a man from a downstairs room as Fakaola Uilou, who lives next door, tried to beat back flames with a garden hose.
"When we got him outside he eventually came round and was trying to get back into the house and get upstairs as there was another wee boy still in there. We had to hold him back," Mr Withy said.
Firefighters rescued the 18-month old and resuscitated him at the scene.
"He was unresponsive at first but they managed to get him going again," Fire Service area commander Mike Shaw said.
The house had fire alarms that were tested by Housing New Zealand regularly. Whether they were functioning at the time was under investigation - as was the cause of the fire.