But the news came as it was reported that loose-fill asbestos insulation had been installed in three Sydney homes and one in Lithgow.

The ABC said Workcover had found government records showing asbestos had been removed from the ceilings of four homes, but there was a risk fibres remained, as in the Canberra Fluffy homes. The Sydney houses were in Warringah, the Hills and Bankstown.

NSW testing began on September 30 and continues across more than 20 local government areas in the state.

NSW is not conducting a comprehensive survey, but inviting anyone with concerns to have the insulation in their ceilings tested to check whether it is the Mr Fluffy-type asbestos insulation which has sparked the Canberra crisis.

By September 19, 281 homeowners had requested testing, most in the Wagga Wagga (71), Ku-ring-gai, north Sydney (40), Yass (36) and Queanbeyan (30) areas.

Authorities have also discovered a house in Orange confirmed to have contained loose-fill asbestos insulation before it was demolished two or three years ago.

Authorities already knew of 12 properties in Queanbeyan, one of which had the asbestos removed by the owners some years ago, and another of which is a two-storey block of 38 units. They also knew of one house in the Palerang area near Braidwood and another in Yass.

Mr Fluffy was based in Canberra but the company or another run by Mr Fluffy Dirk Jansen's son operated in parts of NSW. There have also been suggestions of a Sydney company installing loose-fill asbestos as insulation.