Their father died on the footpath from self-inflicted wounds, police said.
Nat Clarke revealed his sister's last words before Baxter managed to ambush and murder his family.
Rowan Baxter and his three children died in the same horrific incident in suburban Brisbane on Wednesday morning.
An adult male and three children under the age of 10 died at the scene with a woman in a critical condition in hospital with what police described as "significant burns".
Queensland police responded to a auto fire at 8:30 a.m. local time (5:30 p.m. EST, Tuesday) in the suburb of Camp Hill.
According to 9News, Hannah and the couple's three children had been staying with her parents in the Camp Hill neighborhood of Brisbane where the incident occurred.
"I was out the back and came running down the side and ... the rest is history", he said.
He soaked his wife and the inside of the vehicle with fuel, lit up the interior and then removed himself from the auto.
They said Mr Baxter, 42, had attempted to stop helpers intervening, before grabbing a knife from the vehicle and stabbing himself to death.
Facebook Hannah and Rowan Baxter with their three kids.
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They are now staying at the New Clark City in Capas, Tarlac for a 2-week quarantine, the incubation period of the virus. Passengers were required to stay isolated in their suites or cabins, but it has not stopped the spread of the virus.
Unconfirmed reports that Mr Baxter killed his family have been met with widespread condemnation online.
Revenge against Hannah is one possible explanation Bond University criminologist Dr Terry Goldsworthy says. Her children were only a reflection of her.
"I am torturing myself trying to recall any signs that I missed".
"This murderer was a frequent visitor to my home".
"Rowan Baxter set fire to his own wife and kids - but you wouldn't know that from a lot of media headlines", said columnist Arwa Mahdawi on Twitter.
A court had granted at least one domestic violence order relating to the couple, however it is unknown who made the application. "Murder. Them", posted another.
"Hannah and her three children were so senselessly and maddeningly murdered in what has occurred in a awful act of violence and it just grieves our hearts terribly today", he said. In a Facebook post, he wrote, "I am now trying to help raise awareness about #violenceagainstwomen as monsters like this get away with this too often".
"Had we had the kind of supports in place to protect and support women in that period, and we don't have it, then a lot more could have been done".
"RIP you attractive souls".
"I think he tried his best to get to the vehicle". "I will forever love you all". Our thoughts are with their family, the witnesses and first responders who tried to help. If you are in immediate danger call triple zero (000).