Residents surrounding one of 10 reserves being looked at for housing say they are so devastated they are considering selling and leaving Rotorua.
However, the council says no decisions have been made and residents would have the chance to have a say about any formal proposals.
One resident, Pauline Gunn, was on the verge of tears and said she felt "so broken" after working hard all her life to buy her property. Another, Julie Askes, said she wanted to sell but fears her house has already dropped in value.
The residents said while they knew housing was crucial, the trouble in the areas around emergency housing had made them fear living next to public housing.
The Rotorua Daily Post revealed at the weekend that the Rotorua Lakes Council had a secret proposal to turn 10 Rotorua reserves into housing.
The proposal was revealed in documents obtained by the Rotorua Daily Post and related to a closed-door Rotorua Lakes Council "forum" on February 15 revealing a proposal to pursue a local bill to allow the council to sell the reserves.
Under the proposal, five reserves would be sold to Kāinga Ora, three to private developers and two would become pensioner housing owned by the council or philanthropic organisations, the documents suggest.
They claim Kāinga Ora has already created plans for the five sites: Lee Rd Reserve, Coulter Rd Reserve, High St Reserve, Steeles Ln Reserve and part of Turner Drive Reserve.
Other sites potentially up for sale would be Ranginui St Reserve, Gallagher St Reserve, 117 Clinkard Ave, and Linton Park West at 16 Kamahi Pl.
Kāinga Ora confirmed its involvement in the proposal, which it says is at the "early stages".
The council and mayor Steve Chadwick said no decisions had been made.
Gunn, whose home overlooks the High St Reserve, said news of the council's plans had devastated her. As she started to talk to the Rotorua Daily Post about it, she began to cry.
"I'm broken. I bought this house 10 years ago and one of the reasons was this (the reserve)."
She described it as a "quick fix" but not the right fix.
She said she lived by herself and worked shift work and had always felt safe coming and going late at night.
"I work really hard and what will I get? Social housing on my front yard ... I pay a s*** load of tax and this is going to pay for my neighbourhood to be ruined ... Honestly, it is heartbreaking."
She said it was making her reconsider her future.
"I moved here when I was 11 from Auckland. I've come and gone but I always come back. We have always been staunch supporters of Rotorua and how amazing it is here but now do I take all this money I earn and taxes I pay and go to Australia? I've never felt so undervalued in my life, I really contribute to this community."
Her neighbour, Richard Lumsden, said he moved to Rotorua two years ago for the mountain biking lifestyle and buying a house overlooking a reserve meant he could live in a "lovely little area".
He feared the vibe of the area would change.
With a background as an arborist and landscaper, he said it was sad to think a council could sell off a public reserve.
"It's short-sighted, I think. We 100 per cent need housing but surely you don't have to sell off public reserves. You don't get it back once it's gone."
He said he could understand the council needing to firm up its plans behind closed doors but he'd like to think the public would have a say at some stage.
He was worried Rotorua was carrying too much of the burden of housing the homeless from elsewhere.
"When I moved here two years ago, there wasn't that level (of homelessness) here."
He said the Ranolf St and Malfroy Rd Kāinga Ora housing development made "complete sense" and was in the right area.
"Everyone has to agree that we need to do something. No one wants to see these people going homeless, we are better than that as a country, but are they modelling this for locals or what is shipped in as well?"
Julie Askes, whose home borders the reserve, feared her house had gone down in value already just from publicity about the proposal.
She was worried about the nearby early childhood centre and the disruption of her quiet and peaceful outlook, as well as the large trees in the reserve.
She said she was born and bred in Rotorua and came back to live four years ago.
"I was the one with my shoulders back and head high proud to say that I have moved back to Rotorua. But now I want out of here."
She said she would try to fight it alongside her neighbours.
"Why do they need to take the green spaces?"
Central Kids spokeswoman Christine Hall, who has a centre bordering the reserve, didn't want to comment until after she had sought clarification from the council.
Council deputy chief executive district development Jean-Paul Gaston said no decisions had been made. If there were a formal proposal for consideration residents would be informed and would have the opportunity to make submissions.
He said council forums for elected members were part of due diligence before presenting formal proposals for decision-making and consultation. He said information could change between forums and the presentation of proposals.
All potentially viable housing options were being considered to address the district's "critical housing shortage" and getting more housing was a priority in Rotorua's 2021-31 Long-term Plan.
"Any decisions around potential sales of council land would have to comply with council's open spaces policy which, among other things, prescribes the quality and quantity of reserves."
Kāinga Ora and the Ministry of Housing and Urban Development were asked to comment on criticism of the proposal.
Kāinga Ora Bay of Plenty regional director Darren Toy reiterated that the potential opportunity with the council was in the early stages.
Ministry Housing and Services delivery general manager Jonathon Fraser said no decisions had been made and the wider publication consultation would happen when there was a proposal.