The man shot dead by police in Tauranga was "trying to turn his life around", a neighbour says.

Two young children were carried to safety by armed police moments after a man who had been holding them hostage inside a Bellevue house was shot dead.

The children, aged 4 and 6, were taken out the front door and rushed to an ambulance following a 15-hour ordeal which began in the early hours of Sunday morning when the man threatened his partner with a knife.

Dramatic images of the children being rescued from the house emerged today.

The moment an armed offenders squad member rescues one of two children who had been held hostage for 15 hours.

A neighbour said the children at the centre of the hostage situation went to school with her children.

She used to see the man walking his children to school at the same time she did.

She said her friend who used to live next door to the man knew him well and he had reached out to her just last week.

"She said he had previously got out of jail and was trying to turn his life around. She is really devastated at the moment."

The neighbour, who had lived on Oriana Crescent for about 12 years, said the man's family has lived at the address for a while.

The second child is rescued from the property.

But she said the man had only come up to live at the address in the last year.

"Otherwise I haven't seen him around before. It's sad because he was trying to do a good thing with his kids."

The neighbour said she was stuck inside her home yesterday during the 15-hour hostage situation.

She said at about 3pm she heard what sounded like a "bomb and then a whole lot of glass shattering".

The street at which the 15-hour hostage situation unfolded yesterday, culminating in a man being shot dead by police, is eerily quiet today.

The roadblock has been removed and residents are going about their everyday lives.

Mothers are dropping off their children to daycare and to school.

The bell at a nearby primary school has just rung.

Armed police at Oriana Crescent yesterday. Photo / file

Neighbours are going about their business after being told to stay inside and stay safe yesterday.

One neighbour said it was surprising the atmosphere in the street yesterday considering there were policemen with their guns.

She praised the police for keeping everybody safe.

Another neighbour was thankful that the children were out safely.

She described seeing the man involved on yesterday's hostage as a "rough-looking".

Marsh Holloway said he lived four houses down from the property.

Holloway said there was a strong police presence in the area and he said he saw armed police heading in and out of the property throughout the day.

At about 2.30pm, he said police started flying drones over the property and there was "a lot more movement from officers".

"We had only heard rumours of what was going on and when we found out kids were involved it became quite terrifying. I also have small children and I had seen these kids before."

Holloway said just after 3pm he saw the armed police head back around the property, followed by smashing glass and then gunfire.

"My wife and kids started crying as no one knew what had happened to the children," he said.

"Soon after we saw two officers come out with the kids and they were put straight into an ambulance."

A scene guard outside an Oriana Crescent house today. Photo / George Novak

Holloway said neighbours were relieved to see the children were safe.

Holloway said he had seen the children around before.

"The kids seemed happy enough. Nothing out of the ordinary."

Two Oriana Crescent residents, who spoke under anonymity, said they had been out most of Sunday night and got home about 11.45pm.

While they said they did not hear anything overnight on Sunday, their son-in-law heard noises and something breaking.

But they were home in the afternoon about 3pm when the armed offenders rescued the two children still inside.

"There was a bang, bang, bang, then a slight pause and then bang, bang, bang again," a woman said.

She said she didn't have a good sleep that night.

"But we didnt feel unsafe. You never expect this to happen in your own area."