Place the potatoes into a large pot and cover with salted water. Bring to a boil; reduce heat to medium-low, cover, and simmer until just tender, about 10 minutes.
Drain and allow to steam dry for a minute or two; cut into 1/2-inch pieces and place into a large mixing bowl.
Meanwhile, stir the bacon and onion together in a large skillet over medium heat until the fat has rendered from the bacon and the onion is very tender but not brown, about 15 minutes. Stir in the flour, sugar, and salt; cook for 1 minute.
Pour in the vinegar; bring to a simmer and cook until slightly thickened, about 5 minutes.
Pour the dressing over the potatoes and sprinkle with celery seed and parsley. Stir gently to combine.
