Immersed in a cloud of sawdust, carpenter Dainzhen Lhamo vigorously gouges scratches into a newly carved door using a steel brush, vandalizing the entrance to a half-finished wooden house in Dukezong town.

As the 1,300-year-old town builds from the ashes of a fire that destroyed 300 houses in January 2014, its residents are clinging to the time-worn facade of their ancient home.

Before Dainzhen is finished with the door, he will carve worm holes and give it a new coat of paint.

"I want to restore a sense of history and build the house so it looks like it was before the fire," Dawa Cering, who hired Dainzhen to work on his house, said.

Once a hub along the old Tea-Horse Road, Dukezong is a Tibetan village located in Shangri-La County, southwest China's Yunnan Province. It was built according to "Shambhala (heavenly realm)" in Sutra and named the "Town of Moonlight" in Tibetan. The town, with well-preserved Tibetan residential houses and plenty of bars, inns and specialty stores, was a hot tourism spot before the fire.

Yang Jizu, an official with the reconstruction headquarters, said owners are required to repair their own houses using government subsidies and guidance. Currently, more than 3,000 builders work each day to renovate the town, despite the summer rain.

Deputy Party chief of Shangri-la Kang Jianhua said the local government advised the reconstruction work preserve the original flavor of the town.

Cering's house has been chosen as a demonstration project by the government. The 280-square-meter house was formerly used as a specialty store.

"There were seven years left on the lease after the fire," he said. "I extended the lease to 12 years and have already invested around 500,000 yuan (80,550 U.S. dollars) in rebuilding the house."

"Construction has strictly followed ancient construction techniques. The walls are piled up with soil and the pillars, roof girder and floor are all made of wood," he said.

Despite his enthusiasm for restoring the original beauty of the house, Cering is also worried about extra expenses.

Work to make the new house look aged will cost him an extra 20,000 yuan or more and is not covered by the government subsidies, he said.

"I will try my best to restore the house's former beauty, even if that will cost me more money and time," he said.

On another street, construction of another new house has been stopped since May, with only the frame of the building finished. The house will be a hostel in the future.

"I am waiting for the completion of Cering's new house, and I will learn from his experience in restoring the old look of the houses," owner Namkua said.

Not all the residents are in the plan. Down the street from the future hostel, two newly completed houses shine with a layer of bright yellow paint.

"Those houses look too new and cannot reflect the simple beauty of the ancient town," he says.

The fire in Dukezong, caused by an electric heater, destroyed about one third of the town's buildings. In the streets unaffected by the fire, bars, cafes and restaurants are still receiving tourists.

The local government invested 1.2 billion yuan and originally planned to finish restoration within three years, Kang Jianhua said.

"The speed of construction outpaced our expectations, and it is expected that the burnt out area can finish basic restoration and be reopened to public by the end of this year," he said.