What is an assignment sale?

An assignment sale lets an original purchaser of a pre-construction unit pass their purchase agreement to a new buyer before the property closes. Instead of the original buyer taking title, the new buyer steps into the contract, assumes the same purchase price and closing date, and becomes the owner at possession.

This practice is common in Ontario's condo market, particularly when market conditions shift between purchase and closing or when a buyer's circumstances change. The original purchaser may assign their rights for a profit if the property has appreciated, or to exit a purchase they no longer want to complete.

Critical to any assignment is builder consent. Most pre-construction agreements require the builder's written approval before an assignment can take effect. Builders typically review assignments to ensure the new buyer meets their financial requirements and that all original contract terms remain intact. Consent cannot be unreasonably withheld, though builders retain discretion on legitimate grounds.

Assignment sales differ from resale transactions because no new mortgage financing or appraisal occurs on the builder's side, and the transaction closes between the assignee and builder rather than between two private parties. The costs and logistics are simpler than a traditional resale, though the assignee is still responsible for satisfying their own mortgage lender and legal obligations.

Real estate agents working with new construction pre-sales often advise clients on assignment options and manage the builder approval process.