Downtown Austin condos dwindling

AUSTIN (KXAN) - Appearances can be deceiving.

Just 408 condos remain available for sale in Downtown Austin. Because of tight financing, no new projects are likely to go up for another four or five years.

The number of residents living downtown has doubled in the past decade to 8,000 people, but that growth will be slowing down.

Financing is the biggest hurdle. John McClellan of Supreme Lending said a developer would have to pony up enough money to choke a horse to secure a loan.

"There's not a lot of banks willing to loan money right now," said McClellan. "You may have to put up 50, 60, 70 percent, and on a $200 million project that's a lot of money."

Over the past five years, 60,000 new homes have been built in the greater Austin area. In this decade, some 2,000 condos and 2,000 apartments have been built downtown, but Goodwin Partners realtor Kevin Bown it will be awhile before anything new goes up.

"The most optimistic folks think maybe late next year there could be some construction financing, and then it takes two and a half years to break ground and build one of these," said Bown. "So we know on the early side it will be four years before we can bring any extra supply into downtown and we only have 408 units to last that four years."

The good news is a downtown condo owner now may see their value appreciate as the supply dwindles. But that owner would have to find a prospective buyer who could secure their own financing, and that might be tight.