Preston Council has pulled out of a planning appeal process as a result of its continuing dispute with central government over housing supply figures.
It is the latest development that could affect plans to build hundreds of homes in the Barton and Broughton areas.
Last year the town hall rejected a bid by Wainhomes to build 55 houses at land at Cardwell’s Farm on Garstang Road as it would create an “inappropriate expansion” of village communities.
READ MORE: Developers rejected on Preston housing site
The developer has appealed the decision with a hearing before an independent inspector set for later this year. But, with the council recently having to withdraw its participation during a similar planning appeal, the decision has been made to pull out at this early stage.
A council spokesperson said: “Following the concession made by the council at the recent inquiry into the appeals at Sandy Gate Lane and Key Fold Farm, that it did not have a five year supply of deliverable housing land, the council was obliged to review its position in connection with the existing appeal.
“Having done so, the planning committee decided the reasons given for refusal could not be sustained and the correct course would be to withdraw.”
The decision means the hearing could still ahead with other interested parties - such as Parish Councils - able to submit evidence.
Preston Council maintains it does have a demonstrable five year housing supply according to latest figures not available at the previous appeal.
The inspector for the Sandy Gate Lane and Key Fold Farm inquiry will reach a decision next month on whether there is a five year supply, which could have wider ramifications.