The Glenfern Avenue house was completely destroyed in the blaze with firefighters finding the woman’s daughter on the front lawn of the house.
The fire has since been deemed non-suspicious.
Earlier, a neighbour, who did not want to be named, said she heard loud bangs and popping and could see one side of the house engulfed by flames before the blaze spread.
Dozens of firefighters worked to control the house fire, which was deemed under control by 11.15pm.
The CFA said the house was fully engulfed when crews arrived with the exact cause of the blaze under investigation.
Resident Charles Tuplin said he hadn’t been in bed long when his grandson phoned to alert him of the fire.
“It was a pretty hectic fire,” he said. “You could hear the crackle.
“The thing was that intense that in a very short period of time it just completely enveloped the whole building.”
Other neighbours described hearing a loud noise before seeing flames pouring out of the property.
“Basically it was a big bang and we came out and flames were higher than the trees nearly,” neighbour Brodie Leathem told Channel Nine.
“Hopefully everyone’s alright.”
The teenage daughter was later picked up by her father who does not live at the house.
The neighbour said the woman also had a son, but that he was staying elsewhere at the time.
Neighbour Leanne said she although she didn’t known the woman, she had been concerned about her safety all day.
“I’ve been worried if she’s going to appear anytime soon or was she stuck in the fire,” she said.
“I’m so happy she was found.”
Leanne said she woke up to sirens blaring in her street and was shocked to see the gutted home later that morning.
Melissa Cunningham reports breaking news for The Age.
Erin covers crime for The Age. Most recently she was a police reporter at the Geelong Advertiser.