Plans to convert part of the West Rock car park in Warwick into social housing could be submitted to the district council.
Waterloo Housing has held a preliminary consultation with a small group of people living close to the car park.
The district council is set to clear some 40 places from the car park and free up the space for potential building.
Waterloo is about to start work on the conversion of the old gas works in Saltisford into 11 apartments with nine houses, and building more properties on the former fire station.
Its idea for the West Rock site would be three houses and 11 apartments, all for rent or part ownership.
Only a handful of people attended a pre-application consultation.
But one of them, Paul Young, said: “My wife and I immediately thought losing spaces at West Rock would mean more motorists driving up and down the road looking for spaces.
“I don’t know how others will feel but West Rock is the second most used car park in Warwick. During the week its average occupancy is 85 per cent.
“We should have a wider public consultation. Do we need more town centre domestic property development, which will put more pressure on on-street parking elsewhere?”
Mr Young pointed out that, even though there are plans to upgrade nearby Linen Street, this is still a far less popular place to leave a vehicle with tight turning circles and inadequate lighting at night. The car park is particularly unpopular with lone women and only attracts a 32 per cent weekday occupancy rate.
West Rock car park, off Theatre Street, is between Sainsburys and the town centre and attracts hundreds of pedestrians as well as motorists.
But a spokeswoman for Waterloo Housing said no formal application has yet been made as the company was still looking at the space.
She added: “We are commited to providing more social housing. The district council approached us to see what we could suggest for this plot but we are not sure yet whether to go ahead with an application.”