The New Condo Launch Premium: How Much More Are Buyers Paying For The Chance Of An Upside?

Property developers and agents are masters at creating FOMO (fear of missing out). Whether through aggressive pre-launch marketing campaigns, offering attractive low-entry prices, or emphasising the appeal of a particular location, property marketers excel at highlighting the most desirable features of their projects to generate a sense of urgency among buyers.

Consider the following marketing slogans used for property launches in 2025 thus far and the price it sold at.

“First new launch in Clementi in 4 years.” – ELTA (65% sold on launch weekend)

“First new launch in Toa Payoh since 2016.” – ORIE (86% sold on launch weekend)

Earlier this month, another new condominium, Parktown Residence, achieved remarkable success during its launch weekend, selling more than 87% of its available units. What makes this achievement even more impressive than ELTA and ORIE is the scale of the development – Parktown Residence is a megadevelopment with 1,193 units. Selling 87% of its units translates to an astounding 1,041 units sold on launch weekend.

The New Launch Premium

ORIE, located at 10 and 12 Lorong 1 Toa Payoh, is just a 5 to 7-minute walk from Braddell MRT. This area is known for being a mature and densely populated neighbourhood. ORIE sold 86% of its units on launch weekend at an average price of $2,704. The nearest condominium, GEM Residences, achieved its Temporary Occupation Permit (TOP) in 2019 and currently commands an average sales price of $2,082 per square foot (psf).

Unlike ELTA and ORIE, which are located in highly sought-after areas, Parktown Residence is not situated in a traditionally popular location. The area where Parktown Residence is located is a developing part of Tampines, with limited existing infrastructure. The Tampines North MRT station, which will serve the area, is a future station on the Cross Island Line, scheduled for completion in 2030.

Despite this, Parktown Residence saw an impressive 87% of its units sold on launch weekend at an average price of $2,360 per square foot (psf). To put this into perspective, the current asking price for Pasir Ris 8, which is expected to receive its Temporary Occupation Permit (TOP) in March 2025, is around $2,000 psf.

This raises an important question: Is this premium justifiable? Or can it be attributed to marketing strategies, perceived future value or other intangible factors that may only come into play in the future?

The Argument For Parktown Residences

Let’s start with why there was an overwhelming demand for Parktown Residences.

The first is the integrated development play.

Source: Stacked Homes

This table, taken from Stacked Homes, shows that integrated developments in Singapore have consistently enjoyed strong demand, regardless of their location or price.

A prime example is Pasir Ris 8, which is the closest peer comparison to Parktown Residence. During its launch weekend, 85% of its units (415 out of 487) were sold at an average price of around $1,600 per square foot (psf). At the time, many were surprised by the willingness of buyers to pay such prices.

However, with Pasir Ris 8 now approaching its Temporary Occupation Permit (TOP) and selling at nearly $2,000 psf, it has, in hindsight, turned out to be a good purchase. This trend suggests that integrated developments tend to hold their value well and may even see significant price appreciation over time.

The Gross Floor Area (GFA) Harmonisation Factor

The introduction of GFA Harmonisation in 2024 may also have contributed to an increase in per-square-foot (PSF) prices, and makes it harder to compare new launches to existing developments. Under this new regulation, developers can no longer include certain areas, such as the A/C ledge, in the Gross Floor Area (GFA) for sale.

The impact is straightforward. For the same unit layout, the GFA is now smaller post-GFA Harmonisation than before, even though the liveable space remains unchanged. This effectively raises the PSF price, as the total sellable area has been reduced even if the overall unit prices may not have changed significantly.

This may explain why recent new launches under the GFA Harmonisation guidelines appear to have higher PSF prices. Since developers can no longer charge buyers for non-liveable spaces like the A/C ledge, the cost per square foot of the remaining sellable area naturally increases.

For example, let’s compare the smallest three-bedroom unit at Pasir Ris 8 and Parktown Residence.

At Pasir Ris 8, the smallest three-bedroom unit is 1,023 square feet, including a 54-square-foot (5-square-meter) A/C ledge. If we exclude the A/C ledge, the livable space would be 969 square feet.

At Parktown Residence, the smallest three-bedroom unit is 926 square feet. At first glance, it may seem nearly 100 square feet smaller than the Pasir Ris 8 unit. However, when factoring in the GFA Harmonisation rule, the difference is much smaller—only about 43 square feet. This is because Pasir Ris 8 included the A/C ledge in its GFA calculation, while Parktown Residence does not.

This example highlights how the GFA Harmonisation affects unit sizing and why newer launches may appear smaller on paper, even if the actual liveable space remains comparable.

Now, let’s examine the price quantum based on recent transaction data.

For this comparison, we assume a PSF price of $1,974 for Pasir Ris 8, based on the most recent transaction for a two-bedroom unit in November 2024. We use Parktown Residence’s average selling price of $2,360 PSF.

Thus, even though Parktown Residence is selling at about close to 20% more expensive on a PSF basis compared to Pasir Ris 8, the actual quantum difference is about $166,000, or just about 8% difference for a very similar size unit.

First Mover Advantage For Parktown Residence

Even though Tampines North is a newer and still-developing area compared to Pasir Ris, the expectation that property prices should be lower at Tampines North does not seem to hold. Why is this so?

Just a short distance from Parktown Residence, an Executive Condominium (EC), Aurelle Of Tampines, is set to launch on 8 March, with an indicative price of $1,687 per square foot (psf) for a three-bedroom unit. This lower pricing is expected, given that ECs have income eligibility limits and hence units can’t be sold openly to anyone who can afford them. However, as seen with most new ECs, prices are likely to rise once they reach the five-year Minimum Occupation Period (MOP) and enter the private market.

In contrast, despite being in the mature and highly developed Pasir Ris central area, nearby Pasir Ris condominiums like Coco Palms—located just a road away from Pasir Ris 8 and the Pasir Ris MRT station—are selling at around $1,700 psf, which is just around what the new EC Aurelle Of Tampines is going to be priced at. It’s worth noting, however, that Coco Palms, a 99-year leasehold condo from 2008, is already 17 years into its lease, even though it was only completed in 2018.

This suggests an important trend: while Pasir Ris central is already well-developed and may be approaching a price ceiling, Tampines North, as an emerging area, has much more potential for price growth as new infrastructure and amenities come online in the coming years. At least this is what the argument would be when explaining why Parktown Residence will have an upside for the future.

What Could Go Wrong?

We have explained the rationale behind Parktown Residence’s pricing. Now, let’s change perspectives and consider the risks involved.

The biggest risk for Parktown Residence buyers is that they are paying a pretty steep price despite being the first mover in the area. Early buyers in a new district typically expect to secure a lower price than those purchasing future condo launches in the exact location.

For example, Lentor Modern, an integrated development launched in 2022, was among the first major condo projects in the Lentor area, which previously consisted mainly of older condominiums and landed homes. During its launch, units were sold at prices ranging from $1,856 to $2,538 per square foot (psf), with a median price of $2,197 psf. Two years later, Lentor Mansion launched with prices ranging between $2,104 and $2,478 psf—showing an increase, though GFA Harmonisation may have played a role.

The key question is whether future condo launches in Tampines North will be able to sustain prices at $2,000 psf and above.

As the integrated development within the area, Parktown Residence is expected to command a premium over future standalone condo projects. Based on the price difference between Pasir Ris 8 and Coco Palms, this premium could be around 20%. This means that for first-time buyers of Parktown Residence to make a reasonable profit, nearby future condominiums will need to be priced well above $2,000 psf.

When we look at the EC launches in the areas, Tenet has an average sales price of $1,360 psf in 2022 while Aurelle Of Tampines is targeting around the $1,687. These ECs have room to price in a profit, and still be priced below the $2,000 PSF mark.

Tampines’ Existing Condo Market

If we examine existing private condominiums in developed parts of Tampines, none have breached the $2,000 psf mark:

• The Tapestry (TOP 2021): Selling at about $1,700 psf
• Treasure at Tampines (TOP 2023): Also selling at around $1,700 psf

Both projects are further from an MRT station than Parktown Residence, which gives Parktown a location advantage. However, buyers are paying over $2,300 psf in an area that is still under development. This is a significant risk—especially when an already mature and well-established town like Tampines has yet to see private condo prices consistently exceed $2,000 psf.

For Parktown Residence buyers, the long-term bet is that Tampines North will grow into a mature and desirable location, pushing prices higher and perhaps even superseding those of the Tampines central area. However, if the area does not develop as expected, or if future launches do not get the demand to be priced above $2,000 psf, early buyers may face challenges in seeing strong capital appreciation.

Read Also: Should You Sell Your HDB Flat For A (Smaller) New Launch Condominium?

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