Twelve people are homeless after a fire ripped through a restaurant and housing complex in a small town northeast of Toronto Thursday morning.

The two-storey Baltimore, Ont., home, in which two families lived, was burning out of control when firefighters arrived on the scene just before 9:30 a.m. Five fire departments from neighbouring towns battled the blaze for several hours before bringing it under control.

Only one person was home at the time of the fire and was able to escape the thick smoke and flames.

Heather Willert, who along with her husband moved into the building a few months ago, flagged down a passing motorist to call 911.

"I went downstairs to check it out and there was smoke coming in under my front door, so I grabbed the keys for my daughter's lower apartment and went to open her apartment and smoke just billowed out," Willert told CTV News.

She managed to get her two dogs out, as well as a cat, however, four other cats and five kittens were lost in the fire.

Fire officials said the blaze spread quickly through the building which is divided into separate apartments and attached to an old restaurant. The fire started in the middle of the home and spread through the attic.

Hoarding in one of the apartments hindered the efforts of the firefighters.

The Ontario Fire Marshal's office has been called in to investigate.

Damage is estimated at $500,000.

With a report from CTV's John Musselman