Yesterday, at a special council meeting, they convinced councillors to move towards ditching the policy, which has cost the council $230,000 since 2006.
Following the most heated meeting since the council was elected almost a year ago, representatives voted to adopt Cr Trevor Tattersfield's motion to seek legal advice for the September council meeting about the process and implications of withdrawing from Plan Change 24 - Community Housing.
The motion passed even though Crs John Mann, Lex Perkins, Cath Gilmour and Leigh Overton voted against it, in what Cr Gilmour labelled a "protest vote".
Three prominent developers - Marc Bretherton, Allan Dippie and Alastair Porter - asked at the meeting for the plan change to be withdrawn.
Mr Porter said it was "utopian", "complex and expensive" and it contained no workable options.
"It took seven years to get [here] because the development community told you, for seven years, this was the wrong solution.
"There will be another seven years there while we go through every court in the land and you only waste [money]."
During discussions, Cr Gilmour said she would be "extremely nervous" if the plan change was killed.
"If we withdraw, what we are saying is we no longer support the objectives and policies."
She put a new motion for the council to instruct the strategy committee to set up a collaborative working party of all stakeholders to develop a compromise solution.
"If we withdraw plan change 24, we don't have those objectives and policies to refer to ... we screw ourselves and we screw our community."
Her motion lost 6-5, with Crs Tattersfield, Simon Stamers-Smith, Jude Battson, Lyal Cocks, Mel Gazzard and Russell Mawhinney voting against it.
Cr Tattersfield said the recommendation was only "playing with words". While he supported the work of the Queenstown Community Housing Trust, he believed it was time to "wipe the slate clean and start again".
Before his motion to set in train the ditching of the plan change was put, the council adjourned briefly, with Cr Gilmour visibly disappointed her motion had been lost and some councillors shocked.
A quasi-council meeting was held in a corner of the council chambers before the meeting was called to order again, with Mayor Vanessa van Uden stating discussions on the item needed to be held publicly.
Cr Tattersfield's motion was quickly put and seconded by Cr Stamers-Smith. However, council policy and planning general manager Philip Pannett warned it was not as simple as the council's "changing its mind" on the plan change - the new recommendation could have repercussions in terms of stakeholder agreements already in place and decisions of the High Court and Environment Court.
