Developer Cussins saw its proposals for 48 properties next to Burgham Park Golf Club, in Felton, turned down by the Castle Morpeth Local Area Council on Monday.
The scheme had been recommended for approval by county council planners, despite almost 30 objections from locals.
But committee members voted unanimously against the project, amid worries about inappropriate development in the green belt and a lack of access to vital services for future residents.
The land has previously been earmarked for 50 holiday homes, eight of which were built, while permission was also granted for another 14 large executive houses on a section of the site to the north west of the golf club.
Cussins had argued their new proposals would cause less harm to the green belt than the building of those two previous schemes, which could still theoretically be constructed.
Richard Sagar, speaking on behalf of the developer on Monday, claimed there was “every prospect” of those fallback schemes progressing if this one was rejected and that they would be worse for the area – saying the footprint of the new plans was 5% smaller and the scale of the buildings cut by a fifth.
The estate would have comprised 38 detached houses and 10 terraced properties, of between three and five bedrooms.
But Cllr Richard Wearmouth, deputy leader of Northumberland County Council, said he was not persuaded by claims that the development would actually improve the openness of the green belt and suggested refusing planning permission.
He was backed up by fellow council leader Glen Sanderson who called for a “more imaginative” scheme that would bring about more tourism benefits.
Cllr Sanderson said the original holiday homes plans were only allowed on the basis that they would help the golf course to flourish and that principle “should still be at the top of our list”.
Objecting residents had branded the latest housing plans “ill-conceived” and pointed to a lack of shops, bus routes, and other services in the surrounding area.
Labour councillor Julie Foster added: “I tend not to need healthcare while I’m on holiday, I don’t need schools when I’m on holiday. I don’t mind the fact that we have to jump in the car and go to shops, attractions, etc.
“Where I live, I like to be able to have good access to schools that will cover a child right the way from primary to secondary and even further education. I certainly want easier access to shops, particularly given that rural areas tend to be plagued a bit more by bad weather, and good access to healthcare.”