The owners of 205 properties given the wrong information could have the planned F6 motorwayin southern Sydney and other roads constructed over or near their homes or businesses, including one that will need to be compulsorily acquired for a tunnel.
After trawling through data since last Thursday when the bungle was first discovered, bureaucrats have confirmed that 309 people received incorrect information when they asked whether properties they were looking to buy could be impacted by roads.
Up until the review of the data, the government did not know exactly how many properties from the 309 enquiries could be impacted by projects such as the proposed F6, which would extend from St Peters in the inner west to the Sutherland Shire.
The major administrative error has exposed the NSW government to homeowners pursuing it for multimillion-dollar damages claims.
Legal firm Slater and Gordon said its lawyers were investigating the possibility of launching a class action on behalf of owners who face a significant fall in the value of their properties.
While the land beneath one propertywas needed for a proposed tunnel, the government said the other 204 that could be affected were "within a broad area identified for a planned or potential project".
Of those properties affected by the incorrect information from the Central Register of Restrictions, the government confirmed at least 140 have been the subject of a transaction between July 27 and October 24.
The Central Register informs prospective property buyers about whether the government has any interest over land they are looking to buy. The error occurred because a list of affected properties provided by Roads and Maritime Services to Land and Property Information was not uploaded into the central register.
Finance Minister Dominic Perrottet said teams had been sent to knock on doors of residents who had bought properties on the basis that the certificates incorrectly stated that they would not be impacted by road projects.
"I have also personally contacted a number of residents by phone, and in the coming days I will be writing to all those we have identified to communicate the government's apologies."
Mr Perrottet said the staff would encourage affected owners to get in touch with their conveyancers or representatives "as we work to resolve any issues arising from this error".
"We will continue to work to resolve any issues arising from this error on a case-by-case basis," he said.
While homes near the Werrington Arterial road in Penrith were initially thought to be affected by the bungle, Mr Perrottet said no incorrect certificates were issued for properties in or near that project.
The government has rejected suggestions that the bungle is linked to the outsourcing of services in Land & Property Information, which is about to be privatised.
But Labor's roads spokeswoman Jodi McKay said it was hard to see how the bungle was not linked to the changes afoot at Land & Property Information.
"It is a monumental stuff-up. People have to have confidence in this system – this is a fundamental part of government," she said.
She said the error added to the anxiety among residents in Sydney's south who remained in the dark about whether their homes would one day be acquired for the F6.