Paul McDonald Earthmoving foreman Adam Banks, labourer Hamish Bedwell and digger driver Jamahl Edwards were eating lunch in a ute in Sawyers Bay about 1pm.
The men were on a break from installing phone poles in Mill St, when they saw black smoke billowing from a bedroom in the front of a house.
The black smoke was "pouring out faster and faster" as he ran to the house, Mr Edwards said.
Mr Bedwell said the fire took hold quickly and he could see flames climbing a bedroom wall.
"By the time we were out of the ute you could see flames out the window."
Mr Banks said he ran down the side of the house, knocking on the doors and closing windows, while yelling to alert anyone inside the house.
When he reached the backyard he saw the homeowner, Steve Wedlock, and told him the front of his house was on fire.
Mr Wedlock took the fire extinguisher and ran into the house, through waist-high smoke, and used the extinguisher on the blaze.
Mr Wedlock said he was in his backyard "pottering around" and having a cup of tea when he smelt smoke and heard the three workmen.
"I was very lucky. I had no idea there was anything going on ... if it wasn’t for these guys, the house might have burnt down."
He believed the fire started at a plug in the bedroom.
Port Chalmers Volunteer Fire Brigade Chief Fire Officer Stephen Hill said he was not criticising Mr Wedlock but he advised against anyone entering a burning house.
"While he has helped contain the fire, our message is get out, stay out and call the Fire Service. It’s just not worth the risk."
