Dartmouth could be faced with a developers' gold rush resulting in a housing free-for-all if the Millwood Homes project for 405 new homes on the edge of the town ends up falling apart.

After five months of consultation, the building company had declared it has not been allocated enough land to build all the homes.

The developer claims the usable land has come up so short there is only enough space to build 90 homes and still fit in the employment buildings and an area designated for shops and community facilities.

And that is so few it could put the entire viability of the project at risk, warned Millwood Homes' planning manager Judith Gannon.

She said that if the development framework blueprint falls apart it will leave the town wide open to developers fighting to sort out individual schemes to fill the town's new homes allocation.

Ms Gannon said: 'Just 90 homes with the amount of infrastructure that would have to be put in would be marginal. It would put the whole thing at risk.

'If it did not go ahead you would end up with people coming in, putting in applications on sites that have not been allocated. We are trying not to let that happen.'

Now Millwood has asked South Hams Council to allocate extra land for the huge housing scheme and has also asked Dartmouth to back the move.

The Ashburton-based developer is pressing the district council to come up with a decision by July so that the company can put together more detailed proposals for the massive project in time for a new round of consultations in September.

Millwood Homes is looking at building the 405 new homes along with the employment units, community facilities – which includes new sports fields, play areas and public open space – and a new park and ride site across more than 27 hectares, stretching from Dartmouth Academy land to Venn Lane, designated through the development framework process.

But Millwood pointed out that it includes 7.4 hectares of Milton Farm which the owner is refusing to sell and Millwood Homes is refusing even look at using compulsory purchase powers to obtain.

Other sections of land are also considered too steep for housing.

Millwood is asking South Hams Council to look at extending the area of designated land to make up for the shortfall.

Details of the land shortage were unveiled at a consultation meeting involving local councillors and interested groups and organisations.

Ms Gannon said: 'We have submitted a masterplan consultation document to South Hams Council which basically justifies why we want to go outside the masterplan.

'They are considering that at the moment. We only submitted it last week.'

She said Millwood is also waiting for the Dartmouth steering group to come back with comments.

She said the next step is for Millwood to come up with a fresh consultation over what the new development should look like – the style of the buildings, the street scene and which areas should be for employment use.

The next public consultation will be at Dartmouth Baptist Church on September 18, with a steering group meeting at Townstal Community Hall on September 19.