Contractors removing bushes and shrubbery alongside the £160,000 house in Queen's Road, Aldershot, are believed to have dug too deep and weakened the foundations.
Large cracks began to appear in the walls on the night of July 5 and owner Roop Sampla and his family were immediately evacuated to a nearby hotel.
Inspections the following day found the building was unsafe and had to be torn down.
Married Mr Sampla, a 44-year-old factory worker with two sons, stood by helplessly as demolition experts went to work at lunchtime on July 6, tearing down the side wall and exposing the bedrooms, bathroom and dining room.
The family had lived in the house for more than 30 years, but all their possessions were buried under a pile of rubble.
Police closed off the surrounding area for safety reasons as crowds gathered to watch. Neighbours were notified but not evacuated.
Mr Sampla's 23-year-old son Bheem, an alarm engineer, told a national newspaper how disaster struck at around 8pm on July 5.
"First we heard creaking noises, then cracks appeared and got bigger and bigger," he said. "The police arrived to set up a cordon as the house began falling down in front of our eyes.
"We are heartbroken because we loved our home and had just spent £30,000 on a new kitchen, bathroom, doors and carpets.
"The place will have to be completely rebuilt."
His brother Vijay, 16, said: "The cracks were massive and started to spread — the house was moving all night long.
"It just gave way eventually and was demolished before our eyes. There is hardly anything left."
Drinkers were turned out of the neighbouring White Hart at around 9.30pm on July 5 and windows were boarded up to protect them from falling debris.
The official reason for the collapse has not yet been established but neighbours suspect that contract work was a key factor.
Workers had been on site for a week, clearing bushes on the corner of Queen's Road and Church Street in preparation for paving over the area.
But residents grew increasingly concerned about the effect the work could have on the house as the contractors dug deeper and deeper.
One said: "They kept digging and digging and digging. You could see what was going to happen."
There was also speculation that the house foundations were not as solid as they should have been.
Rushmoor Council's housing team is now looking after the Sampla family, who have spent the past few nights in Potters International Hotel and The Falcon Hotel in Farnborough.
John Edwards, director of environmental services, confirmed: "We will be investigating what happened but these things are never simple.
"There has been some work taking place on a bit of land next door but at this stage we just don't know whether that's contributed to it in any way.
"Our top priority at present is looking after the family."
Our picture shows the remains of the house being demolished.