‘Ghost neighborhood’: Can the City of Austin do anything about unfinished developments?

AUSTIN, Texas – Imagine living next to a new neighborhood development, but the developer never finishes construction. That’s the reality for some people in South Austin, who say a so-called “ghost neighborhood” is unsightly and potentially dangerous.

Driving along West Dittmar in South Austin, you might think Southstone is just another planned neighborhood development that’s under construction. But look closer, and you realize there’s no construction, and it hasn’t been for a while.

“They just bailed out,” said Patty Davis, who lives next to the development.

Instead, what’s left are abandoned houses and streets.

“One person in the neighborhood characterized it as a ‘zombie town,'” said Gene Sutton, whose property also abuts the development.

Development on these 45 acres or so has come in fits and starts, with different developers dating back to 2006.

The first cleared the trees, another installed utilities, then roads, but just as soon as progress was made, the work would stop for one reason or another.

In recent years, about a dozen houses went up, but construction was halted before they were finished.

“We just expected they’d start selling houses. And lo and behold, everything stopped. And within the last six months, there’s nothing happening,” said Sutton.

These days, the streets are empty, except for a few piles of garbage, and on either side, houses stand in various stages of completion.

“We get transients, we get critters,” said Davis.

“There may be people living in the homes on Dittmar,” said Sutton.

“The vegetation gets out of control. And then we have a lot of dumping,” said Davis.

Some people have even stolen windows from houses. The abandoned land also spurred concerns about safety.

“Part of it is livability,” said Sutton.

“I don’t drive by at night,” said Davis.

Davis’ property backs right up to the ghost neighborhood.

“I had somebody punch the lock in my truck,” said Davis. “You get kids over there doing things that they probably ought not to be doing.”

Austin’s code compliance team began an investigation earlier this year, after receiving multiple complaints through 3-1-1.

In a statement, the City of Austin’s Development Services Department said in part: “During the inspection on April 10, 2024, the code inspector found that the property had several code violations, including incomplete construction, unsanitary conditions, and high weeds…As the situation progressed, additional inspections were conducted, leading to the identification of new violations.”

City officials confirmed to FOX 7 that construction has been halted since 2022 when the building permits expired, saying inspectors have been able to reach the owner and are working with them to address the violations. “Currently, we are installing surveillance cameras to monitor illegal dumping and conducting regular code inspections to address safety issues on the property. Safety is our priority…”

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The Development Services Department says they do have a process in place, in case they can’t track down the owner:

“If the DSD can’t reach the owner, a code inspector will post a Notice of Violation on the property and continue monitoring it. If safety concerns arise, the code inspector can escalate the case to Municipal Court or the Building and Standards Commission to enforce compliance, depending on the nature of the violations.”

The reality is, this is just one of several parcels of land that have become ghost neighborhoods in Austin. The Development Services Department says they do have a process in place in case they can’t track down the owner:

“If the DSD can’t reach the owner, a code inspector will post a Notice of Violation on the property and continue monitoring it. If safety concerns arise, the code inspector can escalate the case to Municipal Court or the Building and Standards Commission to enforce compliance, depending on the nature of the violations.”

“I’m not sure if there’s a real solution,” said Sutton.

At Southstone, FOX 7 has learned a new developer has proposed a new site plan for the land, including “condominiums with associated improvements” on the property. There is a series of city reviews set for December, in order to reactivate the previously expired building permits.

“The infrastructure is there, the electricity, the streets, the sewage, everything is there. You just need to put the houses on,” said Sutton.

“I would like to see it developed. I would like some lovely neighbors like I have on this street,” said Davis.

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