The five-storey car park Angel Way, in the north end of Romford, would be flattened in favour of 106 houses.
There will also be space for new shops and other community facilities, which the developers say will “enhance” the area.
New housing is a major priority for Havering Council, which overspent its housing budget last year by £6million paying to keep homeless residents in hotels.
It entered the current fiscal year with an unprecedented budget gap of £74m.
The proposals have been developed by Mercury Land Holdings (MLH), a homebuilder fully owned by the town hall.
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Christopher Hobbs, director of MLH, said the project would “deliver much needed new homes in the locality, replacing the ageing multi-storey car park”.
Graham Williamson, Havering’s cabinet member for regeneration, added: “The community’s response to the proposed scheme has been supportive, expressing the need to revitalise the area and provide much-needed housing and amenities for local people.
“The development team has been actively engaging with the community throughout the planning process, through a number of resident events, to make sure the project addresses local concerns and priorities.”
There are a total of 480 parking spaces in Angel Way, but the council says it is not used by enough motorists to make it worthwhile.
The car park is one of six across Hornchurch and Romford it has earmarked for housing.
Though officials say public feedback on the Angel Way plans has been positive, other schemes have been met with considerable pushback.
Residents living near Como Street, alongside opposition councillors, have rallied against early plans for a tower block that could stand up to nine storeys tall.
They said in January the land was “unsuitable” for such a development, which would cause “irreversible damage” to the character of the neighbourhood. Instead, they want to see two-storey family homes.
No plans have yet been formally submitted for Como Street.
The first round of proposals were submitted in April, to transform Keswick Avenue in Hornchurch into six homes.
