The state government has slammed the brakes on new housing proposals in one fast-growing Sydney area, conceding the rapid growth in apartments is outpacing infrastructure in parts of the city.

The government has also suspended the operation of new planning rules making it easier for homeowners to build terraces on their properties in the City of Ryde and the City of Canterbury Bankstown – delaying a policy it introduced only last month.

“We've had a very buoyant property market,” said Planning Minister Anthony Roberts.

The decision follows advice given to the government about where development is straining local infrastructure. Credit:Daniel Munoz

“There's been a huge amount of overseas capital that has landed all of a sudden in Sydney … that has brought on a lot of these dwellings maybe sooner than we normally would have seen,” said Mr Roberts, who on Tuesday told the two councils about the slow-down.