One neighbour said she heard a noise like an explosion, and the sound of slates falling from the roof, thought to have come from the kitchen at the back of the house.
The house is believed to be home to a family of four of Iranian descent, but two sons who live there were not in the house at the time.
One of the children is said to be a doctor working in Preston, called Ommid, while the other is thought to be a medical student, called Arash.
Neighbours paid tribute to the deceased, saying they "could not do enough for you".
Maria Taylor, aged 48, said: "We were supposed to be putting up Christmas decorations today, but how can we do that now? It doesn't seem fitting.
"We'll be buying floral tributes instead.
"We're in complete shock and immensely upset. We can't believe that something like this has happened on our doorstep."
Mrs Taylor said she saw a body being recovered from the house and the emergency services trying to perform CPR on them in the front garden before they were taken away in an ambulance.
Most of the attending police vans and fire engines had left by about 6am.
Another neighour, Stuart Whittle, had just returned from a holiday in Lanzarote in the early hours when he saw the chaos in the street.
He said: "It's a terrible tragedy that's occurred. We feel really sad and really concerned for the relatives that have to be informed.
"They were good neighbours. I've never experienced anything like this, and I've lived here since the 1970s.
"The police came and were asking questions."
Ch Supt David Hull, Bolton's chief police officer, said: “Three people have tragically lost their lives and our thoughts are with their loved ones at this time.
“We have launched a joint investigation with the fire service and experts from both agencies will be working together to find out what happened and why.
“I know people, especially in the local community, will be shocked and anxious to find out what has gone on and as soon as we are able to provide further updates we will do so.
“I do not want to second guess or prejudice the outcome of these investigations but in the interests of absolute transparency want to make it clear that we are treating these deaths as suspicious and are not looking for anyone in connection with the fire at this time.
“There will be extra officers in the area and I would ask local residents to come and speak to us if they have any information or concerns.”
The Mayor of Bolton, Cllr Colin Shaw, lives a few doors down from the house, but said he did not know the family involved.
“The police rang our bell at about 3.15am, got us out of bed and asked us if we’d seen anything suspicious.
“I’ve never seen so many police vans in all my life - there must have been at least a dozen, but somehow we were not woken up until they rang our bell.
“We’ve had people ringing us and asking whether we were okay, because they had heard the road mentioned.
“It is very unfortunate and of course if there are family members left, we pass on our sincere condolences to them.”
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