Selling and Buying Assignment Sales

What is an Assignment Sale? An assignment sale is an option the original purchaser of a new home construction has to exercise and sell the property to another buyer before the closing date. 

Why would they want to sell?
Investors were making a profit based on expectations of rising prices in the market. With a modest down payment, they could get a reasonable return on their investment by selling to another buyer. When the market shifted (interest rates) and property prices declined, that caused financial concerns, so they’re selling.

Why buy an assignment?
There are more properties to choose from than the amount of properties builders are releasing. Financially, builders are careful about releasing too many properties at a time, so they release in smaller quantities. Additional benefits include;
- You’ve purchased the property at the right price in todays market.
- You avoid the uncertainty of the market in one or two years from now.
- You’re looking for a deal as investors panic, you may have an opportunity to buy at less than the original price.

Can’t I just find them myself online?
The majority of builders firmly state in the contract that they will not allow an assignment to be listed on the MLS so you won’t find most of them marketed online. Why? Because they don’t want the appearance of unsold properties and reductions in sale pricing that would cause problems with current and future owners.
 
So how do I find these properties if they’re not found online?
These properties are found by a professional realtor outside of the MLS, in channels that aren’t accessible to the general public. These can be encrypted messaging aps between realtors, database marketing to realtor clients, and exclusive off market registries. You will need to work with the right realtor in order to find these properties on your behalf.  
 
What’s involved in purchasing these assignments?  
The property will have an existing signed purchase agreement with an amendment that outlines upon what conditions the property can be sold to another purchaser, prior to close. The builder has their own stipulations that state what’s required to transfer ownership, which can vary by builder. In most cases the applicant will require the builder’s consent, must be able to pay the original purchasers deposit in full, be approved for a mortgage, along with other stipulations as indicated on the amendment.
It would be recommended to have a lawyer and realtor involved, who understand assignments to find the property and review the contract thoroughly, so you make the right decisions in your own best interest.
 
How do we get started?
A consultation will determine your buying needs and help the realtor source the right property just for you.
The Ontario Real Estate Association requires there be a formal signed relationship between yourself and the realtor before any search begins. A separate document will be shared to explain that to you for your acknowledgement.