Liz Edwards and her daughter Katie were discovered at the property on Friday and police are treating the deaths as a double murder.
Detectives confirmed that two people have been arrested in connection with the investigation and are appealing for sightings of suspicious activity near the victims' home.
One resident living close to Ms Edwards's semi-detached property in Dawson Avenue, Spalding, said she last saw her on Tuesday.
The neighbour, who did not want to be named, said: "She was a lovely lady, very friendly."
I knew her quite well. She was quite well-known because she worked at a primary school and what has happened is just unbelievable. Katie was lovely too but very quiet.
Several bunches of flowers and a teddy bear had been placed on the front lawn of the house by friends of the family, as forensic experts continued to examine the inside of the property.