The London Legacy Development Corporation has been granted outline planning permission for its master plan of the Queen Elizabeth Olympic Park.

The planning approval covers 158 acres of the 558 acre Olympic site, with up to 6,800 homes across five neighbourhoods due to be built over the next 20 years.

The decision by the Olympic Delivery Authority’s Planning Committee is the culmination of three years of work and means that the Legacy Corporation is on course to develop its first neighbourhood Chobham Manor after the games finish.

The LLDC is due to announce a developer for the first neighbourhood next month, and the first homes are anticipated to be ready at the end of 2014.

The plans set out more than half of the 8,000 permanent jobs which are anticipated to be created on the park and includes around 1.2m sq ft of employment space, that will sit alongside the sporting venues, 6.5 km of waterways, cultural attractions and open spaces in five new neighbourhoods on the park.

Andrew Altman, the outgoing chief executive of the London Legacy Development Corporation, said: “This decision represents a giant step forward for east London’s future and the culmination of years of hard work with the local communities and Olympic host boroughs. “We can now realise the vision of creating a new piece of the city that will transform people’s lives with new opportunities.”

Daniel Moylan, chairman of the London Legacy Development Corporation, said: “We are delighted with the decision to approve our planning application for one of the most important regeneration projects in London’s history. These five neighbourhoods will stitch together the surrounding communities of a formerly isolated area through new homes, schools, shops, parks, infrastructure and jobs.

The Mayor of London, Boris Johnson, said: “This is a huge step forward in turning the vision for the development of Queen Elizabeth Olympic Park into a reality that will revolutionise the face of east London and deliver a lasting legacy for the capital. Creating a fantastic new community in which thousands of people can live and work, it is without doubt the most important regeneration project that the city has seen in 25 years.”