The Bureau of Meteorology said some areas recorded as much as 49 millimetres in an hour.
RNZ reports the NSW State Emergency Service (SES) said a building with 100 people inside was threatening to collapse in the western suburb of Marrickville, after the morning of heavy rain.
SES crews were en route to the site.
Emergency services were also called to about 13 flood-related rescues.
SES spokeswoman Becky Gollings said the rescued people were caught by surprise but were now safe.
"All of those rescues have involved people caught in their cars in floodwater," she said.
"The water did rise quite rapidly we had quite a downpour over a matter of hours really, causing roads to flood quite quickly.
"It's concerning for us that people are putting themselves in danger. We just want them to stay out of floodwaters."
Many major roads were inundated causing delays for motorists.
Sydney Airport said airlines were experiencing delays and warned flights could be cancelled.
On King Street, rain forced the evacuation of the Supreme Court building and dozens of people, including those involved in criminal trials, were ordered to leave.
An alarm was triggered and stormwater could be seen leaking into parts of the historic building, although it has now reopened to the public.
Roads were inundated while some shops reported at least two inches of water on their floors.
Darlinghurst cafe Posto No 19 said their outdoor tables and chairs floated down the street when flooding was at its peak.