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The Fire Service was called to South Rd just before 9am, after a car failed to take a corner in wet conditions.
A resident told the Otago Daily Times a woman with a young child knocked on her door after escaping from the Subaru.
The vehicle was teetering above a kitchen where a tenant was at the time of the incident, she said.
The driver stayed in the vehicle, fearing any sudden movement could cause the car to drop into the property below, Dunedin Senior Station Officer Jason Hill said.
''He made the right decision.''
Firefighters anchored the vehicle and then made the rescue.
The man, woman and child were checked by St John staff at the scene.
The vehicle received only minor damage after sliding from the road and across grass, he said.
The Fire Service had attended several callouts in South Rd after rain, and that could be because people were not driving to the conditions, he said.
Residents said there was an accident in South Rd the previous day, debris from which was still visible.