Speaking at a fringe meeting at the Labour Party conference in Manchester, Armitt said: "The situation is changing by the day. There was a certain amount of finance available six months ago, less two months ago and probably less again last week.
"Borrowing in the private sector is nigh-on impossible at the moment."
The £1bn Athletes' Village, situated in the Stratford City development which borders London’s Olympic Park site, was originally intended to be built and funded by developer Lend Lease as a lucrative housing scheme.
However, since the tightening of the global financial markets Lend Lease has been unable to secure debt at sufficiently low levels to make the project financially viable without public sector subsidy.
The ODA last month struck an interim deal with Lend Lease on the village, enabling the firm to act as contractor without an equity stake for an interim period until a final funding agreement can be reached, which would see Lend Lease part fund the project.
"We are in discussion with Lend Lease, their banks and the Government and we are confident we have half the village covered," said Armitt.
"Just how much we get from the private sector - we will have a view on that by the end of the year."
However, Armitt did not rule out the village being entirely publicly funded and said it was too soon to say what difference, if any, the £380bn due to be pumped into the banking sector by the US Federal Reserve this week would make.
"It will depend on what banks are prepared to lend. What value you would ascribe to the Village in 2013 is very difficult to answer," he said.