The NSW Liberal Party has moved closer to stopping property developers becoming councillors after an internal committee resolved to change the party’s rules and ban them from contesting elections as Liberals.

The change, agreed by the Local Government Oversight Committee last week, will now be rubber-stamped by the state executive and then go to a vote at Liberal state council in May.

But in a sign of the factional division the move has caused, party powerbrokers are targeting one of their own: Hunters Hill councillor Zac Miles, an ally of Prime Minister Scott Morrison's right hand man Alex Hawke and a member of the party's state executive.

Hunters Hill councillor and state executive member Zac Miles is under fire from his own Liberal Party associates.

Cr Miles is a senior investment manager at WholeCap, "an alternative provider of finance to property developers and commercial real estate borrowers".