Lake Macquarie council has approved a set of units which some councillors say Charlestown residents must get used to as the housing style of the area.
The 27-unit Dudley Road complex is zoned medium-density but is on a ridge line and has a low-density zone down slope at its rear.
The council deferred a decision on the DA last month for a site inspection due to concerns of privacy, overshadowing, drainage and on-street parking impacts.
Cr John Gilbert said at this week's meeting it was "without doubt" a "necessary style of housing that we need" but he could not support it due to the "negative impacts".
"There are aspects of the design that I believe have an unreasonable amount of impact on neighbours, especially on the southern and western boundaries," he said.
"It interferes with the indoor living and also the outdoor amenity of a number of residences ... because of the fall of the land."
Cr Barney Langford also voted against approval, despite saying the development "had a lot going for it".
"If this is rejected, I would hope the developers go away and perhaps look at redressing the scale ... in order to better fit in with the area."
Cr Jason Pauling questioned the "planning grounds" other councillors had based their decisions on, but Cr Gilbert said "on a lot of occasions we do find developments have a technical fit, but they just don't have a social and person-style fit".
Cr Pauling said he was "highly sympathetic" of the issues residents to the south had raised, but the development was "largely compliant" with the zoning.
The DA was approved six votes to three, but the debate was similar to one that occurred when the council approved a unit complex in nearby Kaleen Street last year.
The majority of housing in east Charlestown is single-dwelling properties, but the area has been zoned R3 medium-density since 2004.
"I think it's naive for anyone near an R3 zoning ... to think there will not be more development in their immediate area," Cr Pauling said.
"We've made a decision to do 60 per cent infill [across the LGA], this is the price you pay.
"If every time we try and do infill development we get nervous because someone nearby is disadvantaged in some way, then we will never reach that potential.
"You either go up and increase density, or you sprawl."
Cr Colin Grigg, who voted against approval, said the council's "first priority" must be residents, not development targets.
Mayor Kay Fraser said the area had been zoned medium-density for many years and was in a state of transition in terms of housing styles and population density.
