A Christchurch property developer spent about $30,000 on consent fees to replace a dilapidated villa with units, only for a council panel to reject his plans.

The panel went against the advice of Christchurch City Council planning staff, who recommended the resource consent be given.

James Cooney and a business partner bought the "as is, where is", quake-damaged Spreydon house late last year. It has a rating value of $10,000 (excluding the 800 square metres of land).

They planned to knock the Bolton Ave villa down and build seven units, to be sold for $310,000 to $420,000 each. Each would have one to two bedrooms and all but one would have off-street parking.

Once built, the units would look much like the block of five units next door.

The plans were not straightforward. It required several exemptions and failed its first consent application. Eventually council staff recommended resource consent be granted after the plans were changed, saying the effect on the neighbourhood was "less than minor".

But a hearings panel turned it down on the basis the high-density design did not fit the area's character. Cooney has no way to appeal.

"You've got all these experts supporting this, and it gets to the panel and gets declined again, you've got to start asking questions why," he said.

Cooney accepted why his first application was declined; "there were definitely flaws there, and we were pushing the boundaries a little bit".

He hired a planner from Novo Group to refine the design, working through the feedback from the first decision to remedy the issues. His second application had support from council planners, but was also declined.

The property is zoned residential medium density, meaning developments involving more than three units require resource consent. Resource consent is also required for 12 aspects including having limited space for cars to manoeuvre, the amount of outdoor living space at some units, and the distance of the buildings from the boundaries and road.

A report written by council planner Matthew Klomp, which referenced advice from urban designer Boyd Barber and was reviewed by senior planner Helen Bealey, recommended the consent be granted. It found the development would have "less than minor" negative effect on neighbouring properties.

A hearings panel (made up of commissioner David Mountfort and community board members Melanie Coker and Helen Broughton) declined the consent, arguing there was not enough outdoor space for most units and not enough space to park cars or access garages.

In the decision, the panel said the development's density was equivalent to 88 households per hectare, and it questioned whether that was within the character planned for the area.

It was concerned the council was being asked to grant exemptions on so many aspects, and the precedent it might set if it did so, which "could lead to more pressure for over-development".

Broughton said panel members were unable to comment further on the decision.

There are at least three other properties each containing three to five units near the property Cooney wanted to develop. Next door, there are five units with a total of 15 bedrooms.

Cooney spent almost $30,000 on consent fees, consultants and legal advice.

He said he did not feel the process was fair, or that the experts' advice was considered seriously. He wanted to be confident the process was impartial.

He said housing density issues and supply shortages were regularly discussed in the news, but he often saw stories about developers being held back from building the needed housing stock. However, critics of calls for increased housing density in Christchurch have said it will degrade areas and benefit only developers.

Cooney said because of the resource consent outcome, he planned to leave the dilapidated house on the property.

Only complex applications are sent to a hearings panel, a process that began in 2007.

Council head of resource consents John Higgins said any elected member on a hearings panel needed to have done the Ministry for the Environment's "Good Decision Making" training course, which covered impartiality, the process of the Resource Management Act, and how to make decisions under the Act.

No appeals were allowed for residential applications under the act, but the Government may change that under a recently released bill, he said.

City councillor Phil Clearwater said while a range of housing densities was desirable, it had to be done well. There were successful higher density developments in areas like Addington, but some projects could spoil the neighbourliness of a street, he said.