New launch vs resale condo – analysing profitability of all new launches that TOP between 2020 to 2023

New launch vs resale condo

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Try walking into a glitzy new launch development showroom this weekend, and you will sure to be bombarded by this marketing speak by a property agent. “You should get a new launch condo over a resale condo, as it provides much better capital gain ! “

This common sales pitch is backed by the following factors.

TOP effect

New launch developments are often touted to provide better capital appreciation due to the “TOP effect”. This is the case whereby prospective buyers are willing to pay more for a new launch because they are attracted to the idea that they will be purchasing a brand new property that allows them to build their dream home from scratch.

Compared to a resale condo, the buyers would have to either overhaul or make alterations on the current owner’s interior design. In addition to that, prospective buyers would have to be mindful of higher repair costs to be incurred on replacing air cons and faulty oven, cooker hood and pipings.

Early bird discount

Another factor often claimed to contribute to higher capital appreciation for new launch development, is the early bird discount that developers offer to drive awareness for a new project. Buyers purchasing early can save between 5% to 15%, enjoy a price cushion for capital appreciation.

The scope of this article

In this article, we will specifically dive deep into the actual performance of all new launch developments that achieve its TOP status between 2020 and 2023 and verify if this common saying is indeed true.

We do this by reviewing the performance of all new launches with the following characteristics

  • Achieve TOP status between 2020 to 2023
  • Mid-sized development with greater than 400 units built

We track the following metrics

  • Profit – the actual quantum of profit that is made when selling the property
  • Price appreciation – the average growth percentage between the property initial entry price and its exit selling price
  • Compounded annual growth rate – the average annual price appreciation of the property over its holding period
  • Holding period – the average no of years property is held, before being sold

To ensure we truly measure price appreciation enjoyed by direct buyers of new launch condos, we classified transactions into 2 categories.

  • New sale – Buyer than purchased during the new launch phase directly from developer and reselling to another buyer
  • Resale – Buyers that purchase after the new launch phase from another seller and reselling it afterwards

Performance of new launch condo development that TOP between 2020 and 2023

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%) CAGR (%) Holding Period
Whistler GrandClementi D5OCR2022716278,03725.56%7.60%3.1
Parc EstaGeylangD14RCR20221,399283,29222.43%6.73%3.1
Forest WoodsSerangoonD19 OCR2020519249,32522.40%4.53%4.5
JadescapeBishanD20RCR20221,206322,32821.75%6.21%3.3
Grandeur Park ResidencesBedokD15 OCR2020720217,82121.24%4.41%4.4
Stirling ResidencesQueenstownD3 RCR20221,259281,46121.12%6.05%3.3
Seaside ResidencesBedokD15 OCR2021841274,64519.38%4.70%3.8
TreverToa Payoh D13 RCR2022729202,77417.71%4.85%3.5
Riverfront ResidencesHougangD19OCR20231,451166,41717.53%4.88%3
Twin ViewClementiD5OCR2021520233,54217.50%5.01%3.4
Queens PeakQueenstownD5RCR2020736188,61317.50%3.66%4.4
The Woodleigh ResidencesToa PayohD13RCR2023667223,03317.49%5.20%3.2
Parc BotanniaSengkang D28 OCR2022735166,03317.11%4.60%3.5
Park ColonialToa PayohD13RCR2021805224,59617.02%4.71%3.5
Le QuestBukit Batok D23 OCR2020516148,72916.99%4.12%3.9
JovellPasir Ris D17OCR2022428122,03516.86%5.25%3.1
Martin ModernRiver ValleyD9CCR2021450418,77115.92%3.73%3.9
Affinity at SerangoonSerangoon D19 OCR20231,012150,94715.27%4.11%3.6
Avenue South ResidenceBukit MerahD3RCR1,0742214,38614.66%4.64%3.0
Kent Rigde Hill ResidencesQueenstownD5RCR2023498153,08914.41%4.04%3.3
The TapestryTampines D18 OCR2021861145,39413.70%3.76%3.7
The Garden ResidencesSerangoonD19 OCR2021613121,81911.76%3.59%3.4
Fourth Avenue ResidencesBukit TimahD10CCR2022476165,7508.63%2.31%3.2

Reviewing the performance of the different new launch developments that achieve its TOP status between 2020 and 2023. We easily infer that not all new launches performed equally well.

Focusing on price appreciation as a metric, we can segregate the different developments into 3 quartiles. With the upper quartile achieving strong price appreciation of between 20% to 25% growth ,the middle profile achieving price appreciation of 16% to 17% growth and the lower quartile achieving poorer performance of between 8% to 15% growth.

Stemming back to the common statement of new launches promising a higher return than its resale counterpart, this statement may not always hold true. Selecting a new launch development that fell into the lower quartile would mean that a comparable resale unit could perform equally well if not better.

Supply plays a major factor in influencing the potential for capital appreciation for new launch

Examining the top quartile developments and the lower quartile developments, it can be inferred that supply plays a major role in influencing the performance of new launch developments.

New Launch In Mature Estate With Limited New Launch Condo Supply Performed Well

Referencing the top quartile performers, Parc Esta, Jadescape, Stirling Residences and Forest Woods are new launch developments launched in mature estates.

These mature estates like Eunos, Sin Ming, Queenstown and Serangoon have not seen new mega development condo launches in many years. And the condo developments in these areas are mainly older developments with age 10 years and above.

For home buyers looking to relocate into these mature estates with established amenities. They will be comparing these brand new launch units with older units, and this is when the “TOP effect” works to its greatest effect to drive price appreciation.

Parc Esta and its competing developments

Project NameTenureCompletionNo of unitsDist (m) – From Eunos MRTAvg Price (S$ psf)
PARC ESTA99 yrs FROM 201820221,3992131,984
SUITES @ EUNOSFreehold2012282961,544
EUNOS GREENFreehold199834306966
SUITES@CHANGIFreehold2012443471,327
EUNOS PARKFreehold1995553491,051
LE REVEFreehold2007653521,299
DENG FU VILLEFreehold2007443981,303
THE ELEGANCE @ CHANGIFreehold200626398988
EVERITT GREENFreehold2003154261,116
THE ARIELFreehold2011204281,292

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Jadescape and its competing developments

Project NameTenureCompletionNo of unitsDist (m) – From Marymount MRTAvg Price (S$ psf)
JADESCAPE99 yrs FROM 201820221,2061021,830
SEASONS VIEW99 yrs FROM 199620002242111,153
MARYMOUNT VIEWFreehold1992682111,416
TRESALVEOFreehold20121762421,648
BOONVIEWFreehold20031202851,520
SIN MING PLAZAFreehold19921023031,228
THOMSON V ONE99 yrs FROM 20012007214021,416
THOMSON V TWOFreehold2012744111,569
183 LONGHAUSFreehold2019404261,693
LAKEVIEW ESTATE99 yrs FROM 197719772406261,002

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Forest wood and its competing developments

Project NameTenureCompletionNo of unitsDist (m) – From Serangoon MRTAvg Price (S$ psf)
Forest Woods99 yrs FROM 201620205193731,732
JADE RESIDENCESFreehold20171714741,520
PRESTO@UPPER SERANGOONFreehold2016364951,420
THE YARDLEYFreehold2005553011,438
SUNGLADE99 yrs FROM 200020034752991,246
SUNSHINE GROVEFreehold2003203831,211
THE SUNSHINEFreehold2003454191,219
CHERRYHILLFreehold19941634991,180
MONDO MANSION BUILDINGFreehold19764171,144

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On the other extreme, referencing the lower quartile development. You would notice that they are launched in areas where there is ample supply of new condo developments.

In the Woodleigh and Potong Pasir area, Park Colonial, Trever, followed by The Woodleigh Residences all launched consecutively between 2021 to 2023. Alongside other existing developments in the area, buyers have got many options to choose from.

Trever, Parc Colonial, Woodleigh Residences and its competing developments

Project NameTenureCompletionNo of unitsDist (m) – From Woodleigh MRTAvg Price (S$ psf)
THE WOODLEIGH RESIDENCES99 yrs FROM 201720236671142,121
THE TRE VER99 yrs FROM 201820227296941,822
PARK COLONIAL99 yrs FROM 201720218051771,978
THE POIZ RESIDENCES99 yrs FROM 201420187318281,754
R MAISONFreehold2016454701,385
E MAISONFreehold20161304861,421
THE QUINNFreehold20161395951,375
VIBES@UPPER SERANGOONFreehold2016606321,389
PRESTO@UPPER SERANGOONFreehold2016367261,420
SENNETT RESIDENCE99 yrs FROM 201120163328871,558

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Similarly for Upper Serangoon and Hougang area, Riverfront Residences is launched in a area whereby there are lots of equally young comparable condo developments

Riverfront Residences and its competing developments

Project NameTenureCompletionNo of unitsDist (m)Avg Price (S$ psf)
RIVERFRONT RESIDENCES99 yrs FROM 201820231,451491,464
KINGSFORD WATERBAY99 yrs FROM 201420181,1575061,308
RIVERSAILS99 yrs FROM 201120169208601,134
MIDTOWN RESIDENCES99 yrs FROM 201320161605421,387
BOATHOUSE RESIDENCES99 yrs FROM 201120154936061,141
NAUNG RESIDENCE999 yrs FROM 18832015608881,439
PARC VERA99 yrs FROM 201020144529641,124
RIO VISTA99 yrs FROM 20012004716331925
EVERGREEN PARK99 yrs FROM 19951999394188830

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Comparing new launch performance with comparable resale development in the area

In this section, we will dive deeper to compare each new launch with its resale counterpart to see if its price appreciation truly surpasses that of a comparable resale property.

The earlier trends hold, with the upper quartile performers outperforming their resale counterparts.

Comparison Whistler Grand and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding Period
Whistler GrandClementiD5OCR2022716278,03725.56%7.60%3.1
The TrilinqClementiD5OCR2017755182,47913.83%2.55%5.2

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Comparison Stirling Residences and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding Period
Stirling ResidencesQueenstownD3RCR20221,259281,46121.12%6.05%3.3
Queens PeakQueenstownD5RCR2020736188,61317.50%3.66%4.4
Commonwealth TowersQueenstownD3RCR2017845194,78612.98%2.87%4.1

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Comparison Forest Woods and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding Period
Forest WoodsSerangoonD19OCR2020519249,32522.40%4.53%4.5
Jade ResidencesSerangoonD19OCR201717152,6194.31%0.52%7.3
Sunglade – 3-5 year holding periodSerangoonD19OCR2003475149,74512.60%2.89%4.3

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But we do see some exceptions whereby there are some resale developments that still manage to outperform its new launch counterpart.

Comparison Jadescape and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding Period
JadescapeBishanD20RCR20221,206322,32821.75%6.21%3.3
TresalveoBishanD20RCR2012176301,91019.52%2.85%6.3
Clover by the parkBishanD20RCR2011616357,18922.12%2.69%7.6

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Taking Clover By The Park as an example, despite Jadescape’s decent performance, it still manage to outperform Jadescape.

Another example is The Bayshore, who performed equally well as The Seaside Residences over a 3 year holding period.

Comparison Seaside Residences and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding Period
Seaside ResidencesBedokD15OCR2021841274,64519.38%4.70%3.8
The Bayshore – 3 years holding periodBedokD16OCR19961,038218,90320.66%6.35%3.0
The BayshoreBedokD16OCR19961,038260,41332.89%2.76%10.8

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When comparing the middle and lower quartile performers with their resale counterparts, you can see that their resale counterpart price appreciation cuts very close to theirs. Confirming the point that the much touted “TOP effect” is not common amongst all new launches.

Comparison Trever, Parc Colonial, Woodleigh Residences and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding PeriodRemark
TreverToa PayohD13RCR2022729202,77417.71%4.85%3.5 
The Woodleigh ResidencesToa PayohD13RCR2023667223,03317.49%5.20%3.2 
Park ColonialToa PayohD13RCR2021805224,59617.02%4.71%3.5 
The Poiz ResidencesToa PayohD13RCR2018731280,04317.77%4.63%3.6 
Blossoms @ WoodleighToa PayohD13RCR2007240518,69553.25%10.52%5.6Freehold
8@woodleighToa PayohD13RCR2012330140,69811.42%2.01%5.8 

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Comparison Riverfront Residences and its resale counterpart

Project NameLocationDistrictRegionCompletionNo of UnitsProfitPrice Appreciation (%)CAGR (%)Holding Period
Riverfront residencesHougangD19OCR20231,451166,41717.53%4.88%3
Kingsford WaterbayHougangD19OCR20181,157-39,265-3.84%-1.18%4
RiversailsHougangD19OCR2016920156,61115.63%4.52%4

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Final words

While it is generally true that new launches do provide a chance of greater capital appreciation compared to resale condos. It is important to note that this does not apply to all projects, careful due diligence needs to be exercised to select the right development.

At a high level, the existing supply of competing new developments in the area is an important factor to consider, alongside other factors.

Similarly, there are resale developments that have shown that they can outperform new launches and this remains a topic that deserves an in-depth coverage in another article.

More reads, more gains ?

Kudos on making it this far. The fact that you have invested the last 5 mins reading this article. We believe you are a like minded real estate investor looking to beat the rat race by getting more out of your real estate investment. If so, do check out the following articles.

Guide to purchasing 2nd property in Singapore
How to avoid ABSD
Decoupling Property Singapore 
Sell one buy two strategy 
Best condo size for investment  

Author

  • Jue Wen

    Jue Wen is the content marketing lead. This means he spend his waking hours researching and writing all things real estate. He believes life is a hustle and there is no joy in grinding away daily in our little rat races. He believes making wise moves in real estate investment can be a game changer. Aside from writing all things real estate, you can find him in your nearest bouldering gym.

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Jue Wen

Author

Jue Wen is the property analyst and content marketing lead at decoupling expertise.
He specialises in helping clients overcome the complexities involved in owning their second private property in Singapore.
He had over 10 years of experience in real estate investing and have written over 40 detail guides on decoupling and minimising ABSD. He is a licensed real estate consultant and holds a Bachelor degree in Business Management from the Nanyang Technological University.

Kenji

Co-Author

Kenji is the Group Division Director of ERA Realty Network.
He have got over 20 years of experience in real estate and have successfully helped over 50 couples purchased their second property. He specialises in helping client achieve the best approach towards acquiring their ideal investment properties while minimising ABSD.