At a Queenstown Lakes District council meeting in Wanaka on Thursday, councillors voted unanimously to accept a recommendation by senior council planners for an investigation into an integrated approach to developing the area.
Council planning general manager Tony Avery and planning policy manager Ian Bayliss presented the report containing information on options for rural residential use or urban development along Ladies Mile and nearby areas.
This followed a decision by councillors last month to reject proposals to recommend three Special Housing Areas to the Minister for Housing and Urban Development.
Mr Avery told councillors there continued to be strong demand for more housing in Queenstown and he envisaged 2000 houses could be built in village-type developments long Ladies Mile, as well as local shops and community areas.
He said one of the most "troubling issues" facing any development along Ladies Mile was traffic congestion and the Shotover Bridge reaching capacity in peak periods.
"I don't have any confidence that NZTA is going to deliver adequately in this regard, both in terms of road capacity and bridge capacity and what may happen around public transport."
Continuing commuter traffic coming from Cromwell also had to be factored into any development, he said.
Councillors agreed this was an opportunity to get the development right, guided by best practice.
