Condo assignments have been becoming more common place in the Toronto Condo Market. New developments often take 3 to 4 years on average to be complete once they start selling units. Over that time frame buyers that purchased and investors looking to "flip" may look to "sell" (assign) their condo before the building is registered and they legally own the unit outright. They are basically selling their interest in their agreement with the builder. Sometimes there are rules and stipulations from the builder that have to be adhered to in order to be allowed to assign a condo.
What is an Assignment?
An assignment is a legal sales transaction whereby the Original Purchaser (the "Assignor") of a property sells, and thereby transfers, their interest and obligations under the original contract to a new Purchaser (the "Assignee"). This assignment takes place during or before interim occupancy. The "Assignee" will assume all of the "Assignor's" duties and obligations under the original Purchase & Sale Agreement. These rights and obligations are stated in the original Purchase & Sale Agreement and include terms such as payments of mortgage, taxes and maintenance fees during interim occupancy. Upon Completion, the "Assignee" is granted the Title to the real property and will incur all final closing costs.
An Assignment fee may be charged by the Developer and is normally a cost borne by the "Assignor" (the Original Purchaser).
Advantages of Assignments
There are advantages to both the buyer (assignee) and the seller (assignor).
Assignors: Can save money on occupancy fees, closing costs, property taxes
Assigning your Condo
Most builder's do allow condo assignments in Toronto, there are however some rules in the original agreement that sometimes have to be followed. Even with strict rules in place there are other options that are available to you. Call us today and find out what they are how how they work.
We have years of experience in dealing with assignments - they can be a little tricky so it's imperative you work with someone who is familiar with condo assignments in Toronto. Call us today !