A bushfire in northern NSW that sparked an emergency evacuation order has been contained but crews are preparing for renewed threats as the weather heats up.

People living in Nymboida, about 30km southwest of Grafton, were warned to seek shelter as the blaze barrelled towards homes on Monday.

It has been downgraded to a watch and act alert, after crews used the NSW Rural Fire Service large air tanker to carry out several retardant drops.

The RFS said the blaze was burning close to isolated properties to the southwest, fanned by north-easterly winds and burning in a south westerly direction.

The fire burned through 905ha.

Another fire burning perilously close to houses near Penrith in Sydney’s far west was brought under control, but sent plumes of smoke billowing across the city’s outskirts.

RFS inspector Ben Shepherd said the blaze burned through 20ha but would not spread further.

“It’s clearly demonstrating just how dry it is, not just across Sydney but across the state at the moment,” he told Sydney radio 2GB.

“We hope people across Sydney take it as a bit of a warning.

“All we need is a little bit of wind, and these fires can really take off.”

Dozens of fires were burning at advice level amid strong wind warnings for parts of the NSW coastline and warnings for much warmer weather later in the week.

The Bureau of Meteorology’s Angus Hines said Wednesday was the day of most concern for fire conditions.

“We have a broad area of extreme fire danger for northern NSW. Watch out for fire weather warnings there and possible total fire bans,” he said.

He said Grafton was expected to hit 40C on Wednesday.

” I don’t know if we’ve had many 40C temperatures in NSW this side of winter. This is certainly one of the first. It will be very, very warm there,” Mr Hines said.

The RFS said extreme fire danger warnings forecast for some areas later in the week would likely lead to total fire bans.

People affected by bushfires in some parts of NSW can now access disaster assistance through government grants.

Payments and concession loans are available to eligible people impacted by fires in the Kempsey, Mid-Coast, Port Macquarie Hastings, Inverell, Kyogle, Tenterfield and Mid-Western local government areas.

“We remain dedicated to communities in the face of hazards and will be there long before a disaster strikes and long after the disaster has passed,” NSW Emergency Minister Jihad Dib said.

By Kathryn Magann in Sydney