"We just run out the front door screaming as we're running out the front, Nick my neighbour next door came running over and he's screaming at us at the gate to 'get out quickly, it's about to bulldoze the house down'.
"We then felt the house lifting as we got to the front steps."
Police were forced to smash a window of the bulldozer and pepper-spray the man before hitting the emergency shutdown button to stop the rampage.
"The 48-year-old man is known to the family," New South Wales police said in a statement, adding that he had been charged with attempted murder.
His motive was not known although the Sydney Morning Herald said police are expected to lay a total of 11 charges against the man including breaching a court order imposed against him to protect one of the females living in the home.
A man was charged with attempted murder in Australia on Monday after allegedly stealing a bulldozer, crushing four cars and then driving the machine through a house.