A man has appeared in court charged with two counts of arson in relation to a fatal inferno at a Wellington hostel that killed at least six people.

The charges include one for setting fire to a couch on the third floor of Loafers Lodge hostel a few hours before the main fire broke out.

Fewer than 20 people remain unaccounted for police say, after a fire ripped through the hostel in Newtown early Tuesday morning.

On Thursday evening police announced they had arrested a man facing two charges of arson.

The 48-year-old appeared in the Wellington District Court on Friday morning before Judge Jan Kelly.

Wearing a black hoodie and making hand gestures and wavy movements with his arms, the man stomped back and forth in the dock and told the court he didn’t commit the arson.

“Someone else done it,” he announced.

He pointed at his lawyer, Doug Ewen, and told him he was fired.

“You’re fired, you’re not my lawyer,” he said.

The man was granted interim name suppression and is due to appear in court again on 19 June.

Multiple media applications were made to photograph and film the man in court, but Judge Kelly said it was not appropriate yet and that identification of the man could prejudice his case.

Judge Kelly remanded him in custody.

Acting Wellington District Commander Inspector Dion Bennett said on Thursday evening the investigation into the fire was ongoing, however more serious charges in relation to the deaths have not been ruled out.

He was confident police were not seeking anyone else in relation to the fire.

Police earlier revealed they had been treating the deadly blaze as a homicide after the fire ripped through the building around 12.30am on Tuesday, May 16.

At least six people are confirmed dead and “less than 20″ remain unaccounted for, according to police.

Police recovered two bodies from the scene yesterday and are expected to recover another two today.

Emergency services have formed a guard of honour along a footpath near the hostel as they await the first body to be removed from Loafers Lodge. Photo / George Heard

In an update on Thursday Police said the damage on the third floor was “significant” and there was a lot of debris for search crews to sift through.

“We are doing everything to recover the deceased from Loafers Lodge as quickly as we can,” Bennett said.

Chief Coroner Judge Anna Tutton said this afternoon the disaster victim identification process was now underway for the victims of the fire.

“We can now start working with police and other specialists to determine the identification of those who have died. As I have said, this identification process can be lengthy and complex, requiring a careful and methodical approach to ensure there are no mistakes,” Judge Tutton said.

“I would like to reiterate to the families and friends of those who have died as a result of the fire that the victims will be treated with dignity and respect as we work through this challenging process and we will endeavour to return them to you as quickly as we can.”

- Sam Sherwood and Melissa Nightingale, NZH