Arun District Council approved developer Dandara’s plans in November, only for Secretary of State for Communities and Local Government Greg Clark to intervene at the eleventh hour.
Following pressure from parish councils and Arundel and South Downs MP Nick Herbert, the decision will now be determined by a government inspector.
Chris Allington, chair of Eastergate Parish Council, said: “It is extremely rare for this to happen and I hope that this is a strong signal that localism is meaningful and cannot be simply ignored by district councils.”
A letter sent to interested parties inducates the inquiry will focus on the perceived conflict with the Barnham and Eastergate neighbourhood plan – a document prepared by residents indicating suitable areas for housing.
Suzanne Clark, chair of the Walberton neighbourhood plan team, said “Both we and the Barnham and Eastergate neighbourhood plan team want this land as local green space and we were shocked when Arun approved a massive development here.
“It had been refused permission in 1997 at appeal by the Secretary of State for the Environment and we hope that it will be refused again.”
The news was also welcomed by Barnham Parish Council chairman David Phillips, who called for more dialogue with Arun over planning matters.
Walberton Parish councillors Sue Wallsgrove and Edmund Camerer-Cuss said the parishes would need professional help to prepare for the inquiry but hoped residents – of which they believe over 90 per cent are supportive – would back them.
But Rachel Allwood, planning director for Dandara, was disappointed by the call-in.
She said there would be an ‘inevitable delay’ to the delivery of ‘much-needed homes’, pointing to the approval of the plans by a ‘clear majority’ in November.
A spokesman for Arun District Council added: “This will have significant impact on the Council’s ability to maintain and deliver an adequate supply of housing land for houses to be built to meet the demands of the area.
“Arun’s development control committee’s decision to approve the application in November, 2015, was entirely consistent with recent decisions of the Secretary of State on similar applications.”