Housing campaigners have urged transport secretary Grant Shapps to reverse a “terrible” decision to block a development at Cockfosters Station.

Campaign group PricedOut branded Shapps’ move “a direct contradiction of local democracy” and claimed the scheme – set to provide 351 rental flats on the station car parks – would “ease London’s desperate housing crisis” if it was allowed to proceed.

It comes amid reports of record rent rises across London, with average asking rents for all properties up 14.3% year-on-year to £2,193 per month, according to Rightmove.

The Cockfosters plans, drawn up by Connected Living London (CLL), a partnership between Transport for London and developer Grainger, were narrowly approved by Enfield Council’s planning committee in February. They include 132 homes designated as affordable, split between discounted market rent, London Affordable Rent and London Living Rent levels.

But the following month, Shapps revealed he would block the scheme using a legal clause over land disposal, set out within the act of parliament that granted devolved powers to City Hall. His cited his concerns that the development would lead to “inadequate” parking provision. TfL claimed the law had not been utilised in such a way previously.

PricedOut this month launched a petition, which has so far gained more than 230 signatures, calling for a U-turn on Shapps’ decision. It brands the move “a terrible decision for housing need and for the environment” and “a direct contradiction of local democracy”.

Freddie Poser, director of PricedOut, said: “The UK and especially London has a housing crisis, and this move by Shapps will only make things worse.

“The proposed development is accessible, environmentally sustainable and would have delivered much-needed affordable housing to the area. I really hope Shapps reconsiders his destructive and self-interested decision.”

Enfield Council received more than 2,800 objections during a consultation on the plans, and an online petition to save the car parks gained nearly 3,900 signatures. Among the key concerns raised by opponents were claims the flats would not be affordable to those on the borough’s median household income of £34,000 or average London key worker salaries of £27,000.

The council’s planning report stated that extra funding from Greater London Authority had enabled CLL to “enhance” the affordable housing offer. Proposed rents range from £221 per week to £312 per week, which it claimed would be affordable to those with household incomes from £20,500 to £28,950.

Other concerns raised by opponents of the scheme were that the proposed reduction in public parking spaces – from 370 to 47 – would restrict access to the tube station, including for vulnerable residents, while the tall buildings would harm local heritage features.

PicedOut’s petition has drawn fresh criticism from local residents’ groups. Cockfosters Local Area Residents’ Association (Clara) said in a statement that the station car park was “heavily used” and a “vital amenity”, while the proposed development was “overly dense and of unsatisfactory design, both in terms of the high-rise and predominantly small flats”.

Clara’s statement continued: “We recognise the need for more affordable homes, but this scheme is not the right scheme, nor is it in the right place. The indicative rental prices for the proposed flats will not make them affordable in the local context.”

The association added that “far from this being a failure of local democracy, we are grateful that there was executive oversight to prevent a complete disregard of the considered views of local residents and travellers”.

Peter Gibbs, vice chair of the Federation of Enfield Residents and Allied Associations, claimed Shapps’ refusal to allow the car park to be closed was “entirely in line with national policy towards park and ride”.

He added: “Closing this car park would not be a unique contribution to housing, the majority of units would be too small for families and rentals, even discounted ones, would be out of reach for most local residents. Car ownership would be banned, so occupations requiring cars would be excluded. This is a bad scheme.”

A Department for Transport spokesperson said: “Transport for London must seek the secretary of state’s consent if seeking to dispose of land used for transport operations. This is a regularly-used process. The secretary of state takes their decision following an assessment of information supplied by TfL.”

It has been reported, but not confirmed, that London mayor Sadiq Khan is considering legal action over Shapps’ decision.

A TfL spokesperson said: “We can confirm that on 25th February we received the decision from the secretary of state. We are now taking the necessary time to understand and consider the implications that result from the decision.”