High take-up rates for recent new condo launches have dominated headlines. The sales volume of new condo units is undeniably on the rise. To date, 3,268 sale caveats for new condo units have been lodged this year, up from 1,139 caveats in 1Q2024 and 1,184 caveats in 1Q2023. Amid strong demand, the average price of new condo units has also risen from $2,402 psf in 1Q2024 to the current $2,465 psf (see Chart 1).
Source: EdgeProp Market Trends (as at 26 March 2025)
The bulk of this year’s caveats for new sales were for PARKTOWN Residence (1,051 caveats), The Orie (687 caveats), Lentor Central Residences (454 caveats), and Elta (327 caveats).
In this article, we examine the possible reasons behind this surge in demand and prices for new condo units and whether the trend will continue for the rest of this year.
Many buyers prefer new condos
Prices of resale condo units tend to be lower than those of comparable new condo units. Despite being more affordable, resale condos are accounting for a smaller proportion of total sales volume compared to new condos.
So far, new sales make up 58% of total condo sales this year, compared to 39% for resales and 3% for sub-sales (see Chart 2). In contrast, new sales accounted for only 29% of total sales volume in 1Q2024, while resales and sub-sales made up 63% and 8%, respectively. Similarly, resale transactions (63%) comprised the bulk of total sales in 1Q2023, while new sales accounted for 31% and sub-sales represented the remaining 6%.
Source: EdgeProp Market Trends (as at 26 March 2025)
The narrowing price difference between new and resale condos could be driving the recent preference for new condos. The gap between the average prices of both condo types peaked at $908 psf in 2023 before narrowing to $711 psf last year. This year, it has declined further to $697 psf (see Chart 3).
The smaller price gap may be attributed to a 2.6% decline in the average price of new condos since 2023, bringing it to the current $2,465 psf. In contrast, the average price of resale condos has risen by 8.9% to $1,768 psf over the same period.
Source: Edgerop Market Trends (as at 26 March 2025)
Another reason could be that buyers of new condos pay for their property via a progressive payment scheme. Under this scheme, the bank disburses the mortgage loan amount according to the construction progress of the development. Interest payable is also based on the amount disbursed, allowing buyers to make smaller mortgage payments during the construction phase.
Furthermore, buyers typically do not have to make any payments, except the deposit, until the foundation is completed. This gives them more time to shop around for the best mortgage loan package.
In contrast, banks disburse the full loan amount upfront for resale properties since progressive payment is not available. As a result, buyers of resale properties must begin repaying their mortgage and interest immediately based on the total loan amount.
Buyers of new units might have more choices when it comes to unit selection, especially if they purchase their units when the project is first launched. They can choose from the full range of layouts and storeys. In contrast, buyers of resale units can only select from those available on the resale market.
Buying a brand-new condo also means less wear and tear and hence fewer maintenance issues for the occupiers. Furthermore, a brand-new unit is likely to come equipped with the latest technology and features. As a result, owners of new condo units would typically spend less on renovations compared to owners of resale units.
Additionally, new condos tend to have a longer remaining lease than their resale counterparts which will have an impact on pricing. Lease decay has a greater impact on leasehold condos, whereas freehold condos are generally less affected due to their freehold tenure.
Stellar sales performances of new launches
There have been several recent launches of attractive new condos this year, boosting sales volume for new condo units.
One example is The Orie, located along Lorong 1 Toa Payoh. This 99-year leasehold condo, situated near Braddell MRT Station and numerous amenities, achieved an 86% take-up rate during its launch weekend in January. Based on 687 caveats at the time of writing, the take-up rate for the 777-unit development has since improved to 88.4%.
Last month saw the successful launches of Elta and PARKTOWN Residence. Located in the mature estate of Clementi, the 99-year leasehold Elta achieved a 65% take-up rate upon its initial launch. Since then, 327 caveats have been lodged for the 501-unit condo, increasing its take-up rate slightly to 65.3%. PARKTOWN Residence is a massive 1,193-unit development in Tampines. The convenience of living in an integrated development contributed to its strong take-up rate of 87% during its launch weekend. Since then, 1,051 caveats have been lodged for the 99-year leasehold development, pushing its take-up rate to 88.1%.
Launched earlier this month, Lentor Central Residences recorded a stellar take-up rate of 93% during its launch. To date, the take-up rate has risen to 95.2%, based on 454 caveats lodged for the 477-unit development. This 99-year leasehold condo is located near Lentor MRT Station.
Additionally, very few new condo units have been launched for sale in recent years, likely contributing to pent-up demand. In 2021, 10,496 condo units were launched for sale, but this number has since declined to fewer than 10,000 per year. Last year, only 6,647 condo units were launched for sale (see Chart 4).
Fear of missing out
So far this year, 67% of new condo units sold are from the Outside Central Region (OCR), followed by the Rest of Central Region (RCR) at 28%, and the remaining 6% from the Core Central Region (CCR) (see Chart 5). This could be because most of the projects launched to date are in the OCR.
Source: EdgeProp Market Trends (as at 26 March 2025)
However, many of the upcoming launches for the rest of this year will be in the CCR or RCR. Examples include Bloomsbury Residences along Media Circle, River Green along River Valley Green, and One Marina Gardens along Marina Gardens Lane. Additionally, the upcoming condos on the two Government Land Sales (GLS) sites along Zion Road are expected to be launched later this year.
Most owner-occupiers tend to gravitate towards condos that are well-located near amenities such as schools and public transport hubs. Many of the newly launched condos this year meet these criteria, motivating buyers to sign on the dotted line. A fear of missing out could also be driving some of these purchases as evident by the large crowds and high take-up rates for The Orie, PARKTOWN Residence, Elta and Lentor Central Residences.
Additionally, most owner-occupiers prefer OCR condos because they are generally more affordable than their CCR and RCR counterparts. This year, the average price for new condos in the CCR is the highest at $2,972 psf, followed by RCR and OCR condos at $2,697 psf and $2,323 psf, respectively (see Chart 6). While majority of the condos that have been launched are in the OCR, many upcoming new launches are for CCR and RCR condos, which may have pressured buyers to commit to a purchase to avoid missing out.
Source: EdgeProp Market Trends (as at 28 March 2025)
Rising HDB resale prices
Demand from HDB upgraders may have contributed to the increased demand for new condos. Furthermore, resale prices for HDB flats have been on the rise, giving HDB upgraders a larger budget to purchase their next property. Since 2020, the average resale price for HDB flats islandwide has risen by 47.8% to $637 psf (see Chart 7).
Source: EdgeProp Market Trends (as at 26 March 2025)
The higher resale prices for HDB flats have also contributed to a sharp increase in the number of million-dollar HDB transactions, rising from 302 in 2021 to 1,066 last year (see Chart 8). So far this year, 311 resale HDB flats have changed hands for at least $1 million.
Source: EdgeProp Shortlist (as at 26 March 2025)
HDB flats that have just reached their minimum occupation period (MOP), regardless of location, tend to be in demand due to their long remaining leases.
Last year, approximately 530 flats from Alkaff Lakeview along Alkaff Crescent and about 350 flats from Alkaff Vista along Bidadari Park Drive obtained their MOP. These Bidadari flats are expected to fetch high prices in the resale market because they are centrally located and have the usual MOP of five years. In comparison, many Build-To-Order (BTO) flats in central locations were recently launched under the Prime or Plus categories, which come with a longer MOP of 10 years. However, the longer MOP does not apply to resale flats, regardless of their locations.
Moreover, an unprecedented number of BTO flat owners fulfilled their MOP obligations in 2023, adding a large supply of flats with long remaining tenures to the resale market. These include approximately 3,400 flats in Bukit Batok, 1,900 flats in Hougang, 1,500 flats in Tampines, 1,300 flats in Woodlands, 1,200 flats in Sembawang, 1,100 flats in Yishun, 900 flats in Jurong West, 900 flats in Punggol, 550 flats in Toa Payoh, 500 flats in Sengkang, and 220 flats in Bedok. Many of these flats may have been sold last year, contributing to the record-high number of million-dollar transactions that year.
The number of such deals is expected to remain high, as approximately 1,200 flats in Alkaff Courtview along Bidadari Park Drive are expected to reach MOP this year.
Falling interest rates
The ability of buyers to finance their property purchase has been further enhanced by falling interest rates. Last year, the three-month compounded Singapore Overnight Rate Average (SORA) ranged from 3.4% to 3.7%, but it has fallen to below 3% this year. SORA currently stands at approximately 2.6% (see Chart 9).
Boost to developers’ confidence
Earlier this month, the tender for the Bayshore Road government land sales (GLS) site closed with eight bids. The top bid of $1,388 psf ppr was submitted by a consortium led by SingHaiyi Group.
The appeal of the GLS site lies in its excellent location near Bayshore MRT Station and East Coast Parkway (see Map 1). Additionally, the site is the first residential plot in the Bayshore precinct, providing a first-mover advantage to the successful bidder. Furthermore, the recent surge in demand for new condo units has likely boosted developers’ confidence in the residential market.
Source: EdgeProp LandLens (as at 25 March 2025)
The Confirmed List for the first half of this year includes several other GLS sites that are expected to attract developers to participate in their tenders.
The Dunearn Road GLS site is expected to be launched for tender next month, with an estimated 370 housing units to be built on the site. As the site is located in prime District 10 and within the Bukit Timah Planning Area, strong interest from developers is anticipated. The site is also within a 1km radius of Sixth Avenue MRT Station, Sixth Avenue Centre, and Guthrie House (see Map 2).
Source: EdgeProp LandLens (as at 25 March 2025)
Two well-located sites are expected to be launched for tender in June. They are expected to draw keen interest from developers due to their proximity to MRT stations and other amenities.
The Dorset Road GLS site is within walking distance of Farrer Park MRT Station, Farrer Park Primary School, City Square Mall, and the upcoming Piccadilly Galleria (see Map 3). It is also a short drive from the Central Expressway. An estimated 430 housing units can be built on the site.
Source: EdgeProp LandLens (as at 25 March 2025)
The Telok Blangah Road GLS site is also within walking distance of an MRT station, namely Telok Blangah MRT Station (see Map 4). Other nearby amenities include Mount Faber Park, Berlayer Creek, The Southern Ridges, Blangah Rise Primary School, Seah Im Food Centre, and VivoCity. The site can accommodate an estimated 740 housing units.
Source: EdgeProp LandLens (as at 25 March 2025)
Conclusion
The recent surge in demand for new condo units could be attributed to several factors. However, the recent launches of several well-located condo developments may have played a major role in compelling buyers to commit to their purchases. Additionally, there were fewer new launches in recent years, resulting in pent-up demand that is finally being met by the increased number of newly launched condos this year.
Furthermore, many of the upcoming launches later this year are in the CCR or RCR, and are therefore expected to have higher prices. Buyers, especially owner-occupiers with more modest budgets, may have signed on the dotted line to avoid missing out on the opportunity.
Additionally, the rising HDB prices and falling interest rates have provided more HDB sellers with the financial ability to upgrade to a condo.
The stronger take-up rates during launches seem to have given developers more confidence in the residential market. The Bayshore Road GLS site attracted eight bids when its tender closed earlier this month. Three upcoming GLS sites, located near MRT stations or amenities, may also catch the attention of developers and attract many to participate in their tenders.
