The incident was discovered by neighbours to the property in Lifford shortly before 7am this morning.
The house on the Coneyburrow Road estate – which had been in good condition – was gutted in the blaze.
Its owners are said to be devastated.
Locals believe teenage thugs broke into the house overnight and had held a party there before setting it on fire.
Garda forensic officers are at the scene which has been cordoned off.
Speaking to donegaldaily.com, a neighbour revealed that blaze had been discovered by a Leaving Certificate student who had been up early this morning preparing for exams.
“He got up early to do some studying when he smelled the smoke and raised the alarm,” said the local man.
“Kids had been having a party in the house overnight. Thankfully no-one was hurt but this sort of carry-on is outrageous.”
Gardai in Lifford are appealing for information about the fire.Tags: