Moorlands Holdings North East, owner of the historic Blue Bell Hotel, has lodged the application with Northumberland County Council.
It wants to build five three-storey homes, cut into the hillside, on what used to be part of the hotel’s kitchen garden but has been unusued for more than 20 years.
A further four homes are planned in a field bounded to the east by St Mary’s churchyard, with a new access road.
A change of use application has been lodged for the lower half of the field, north and west of St Cuthbert’s Drive, to allow seven glamping pods, four touring caravan pitches and three static caravan sites.
It also includes a toilet/shower block on the footprint of an existing derelict farm building which would be demolished.
The development has been reduced in scale at the pre-application stage due to the proximity of the hotel.
An objection has been submitted by the neighbouring Blue Bell Farm caravan park.
Phyllis Carruthers states: ‘When my late husband wanted to add an extension to the house in which I now live, it was made very clear by the planning department at Berwick Borough Council that any further applications would be denied as it was considered that further development would be detrimental to the area.
‘Supporting this proposal would be a little like turkeys voting for Christmas.’