Two crews from Rotorua Fire Station and a water tanker from Lake Okareka are currently at the property on Hawthornden Drive.
A Rotorua Daily Post photographer at the scene said an external garage had caught fire and there was a boat inside it. Fire crews were dampening down the shed.
A Fire and Emergency spokesman said the garage was five by nine metres wide and there was no danger to the house or any other properties. He said there were no injuries. A fire investigator has been called to determine the cause.