Crakehall villagers said they had been left stunned by Newett Homes' proposal to build 18 homes close to the grade II listed 17th century Crakehall Water Mill, outside the current development limits of village near Bedale.
They said while Hambleton District Council rejected a plan to build 33 homes on the site in 2010 on the grounds that it was unsustainable, less than two years after being sold the properties the authority had changed its mind.
Residents said as since 2010 16 homes had been built on land next to the site, approving the latest proposal would mean more homes built there than had been refused 11 years ago.
However, the application site, which is due to be considered by the council next Thursday (June 10), has become a "preferred option" in the authority's Emerging Local Plan. If the plan is adopted the principle of developing of the greenfield site would be established.
Recommending the scheme be approved, a planning officers' report states: "Given the advanced stage of the Emerging Local Plan and the feedback received during the public hearings and post hearing letter from the inspector it is considered that the principle of development in this location is acceptable."
Nevertheless, residents said searches before their purchases had not highlighted any further immediate development and it would have been helpful if the council had taken action to stop piecemeal developments.
Resident Wendy Kelvin said: "It is extremely disappointing that after only a short period of time since purchasing our property, we now find that our long searched for open aspect to the rear of our property is to potentially disappear.
"It would appear the reputation of a "beautiful North Yorkshire" landscape is slowly being eroded with ongoing development and is slowly eroding away the North Yorkshire landscape."
Another objector, Mark Percival, added: "We bought a property in a rural setting, the new development will give the properties the feel of a housing estate with no views from our main widows of the open countryside.
"All we will be able to see is ends of houses and other peoples back gardens. We will be looked on from all angles with no privacy."