Developer Jim Wilson said he is planning six townhomes in North Chattanooga on property he has owned since the mid-1980s.
The Planning Commission on Monday gave approval to the project on Hamilton Avenue near North Market Street.
The units are designed by Eric Myers and will be built by Collier Construction.
Mr. Wilson, who lives on Beck Avenue, said he plans to occupy one of the units.
The Planning Commission had asked the developer to come up with a better parking scheme. Alan Knowles, of the commission, said the new plan was much better.
Mr. Wilson said he has been working on the project for several years. He said it was a difficult project because the lot has a 60-foot elevation rise from North Market to Hamilton Avenue.