At one point more than 40 timber frame properties were alight at the site in East Stanley this morning.
The BBC said there were no reported injuries and it took more than 30 firefighters to bring the blaze under control after it started early today.
Surrounding roads, including part of the A693 were closed as a precaution.
A spokesman for County Durham and Darlington Fire and rescue Service said the cause would be investigated.
He said it would take several hours to fully dampen down the site.