The conversion of the properties on Bilston Road, East Park was turned down in August last year because of fears it would cause jams on the nearby junction with Stowheath Lane.
Councillors were also worried about insufficient car parking space and that the site was already over-developed.
Planning bosses this week turned down an amended version of the planning application made by local businessman Gurjinder Bhella, again citing similar reasons.
In a statement outlining the council’s decision, planning officer Colin Noakes said: “The car park entrance is close to the signal-controlled junction of Stowheath Lane and Bilston Road and the proposal is an intensification of the existing residential use.
“Also, the proposed site entrance cannot accommodate the two-way traffic flow – orientated at 90 degrees to avoid disruption to the free flow of traffic along Stowheath Lane and the adjacent signal-controlled junction. The two car parking spaces closest to the entrance and the bin storage/grassed area would prevent this.
“It has the potential to be seriously detrimental to highway safety and the free flow of traffic. The provision of only six parking spaces falls below the required standard. This is likely to lead to future occupiers and visitors parking on the road and causing a serious impact to highway safety and the free flow of traffic.
“Overall, the proposal fails to provide an attractive, green residential environment with adequate amenity space. The level of useable amenity space proposed falls short of the required standard for the size of the development,” he added.
“A large portion of the space does not protect the privacy of the ground floor flats. The layout of some of the flats fails to create satisfactory and flexible living space. The kitchen and living area in flats one and four are too small.
“And two windows in flat five will directly overlook into the property next door, adversely affecting the privacy of the occupants of that property.”
The site is located in one of Wolverhampton’s most deprived areas and is currently occupied by two three-bedroom homes.