The purpose of this study is to propose a new development method for urban residential area, considering the urban site and development conditions rather than just meeting the development limit and regulations. Gwangju Metropolitan city is investigated as a case city and the new method verifies a decision process of pertinent development types and housing forms in urban blocks. The consequences of this study are summarized as follows. The process of a new development method consists of four steps; First, current conditions of the residential area of Gwangju are analysed in order to find out the site characteristics and housing development situations. And the theoretical research is made to set up the development goals and objectives, regarding current trends and future paradigms of residential development. Next, the suitable development sites are selected, and their site characteristics and relevant development types for the future are compared and matched with a close analysis. Finally some pertinent housing forms for each development site are suggested, which fit well in terms of urban context and are appropriate for building up sustainable city in the future.