Assignment sales are a touchy subject, and not many people understand the benefits and drawbacks. This is why our experts are stepping in to shed some light on the subject and to help you as a buyer or seller make the best deal possible.
An assignment sale is the sale of a property before closing. These sales usually happen with pre-construction condos prior to occupancy, but it can be seen in resale properties as well. Essentially, it’s the selling of the contract the original owner had with the developer.
Of course, there are advantages and disadvantages to closing on assignment sales, and our experts will dive into both sides.
First of all, potential buyers can negotiate an excellent deal before purchase. In this case, the new purchaser will have an edge. They get to move into a brand new Toronto condo and take possession of a space that hasn’t been lived in before. If you are the seller, you can liquidate immediately and reap the benefits of saved closing costs and time.
For example, the original buyer will avoid land transfer taxes, HST , and even get their deposit back faster. This will allow the original owner to move on without enduring a heavy loss on the assignment sale.
Circumstances change, and the most common reason for a property to be put on assignment are these uncertain changes. Perhaps the owner is being relocated to another city months beforehand, so their best option is putting it up as an assignment sale. It could also be because of some changes in their financial situation or something as simple as a change of heart.
It may not be as easy to sell assignments as there is a much smaller pool of buyers. However, assignment sales in Toronto have been growing in recent years and people are becoming more open to it as an option.
It is also a great solution if your circumstances change and you need to get out of the contract quickly. It may take some time, but the losses you sustain could be a lot less. Our experts stress doing due diligence on the property and contracts before taking the plunge.
If you are looking at a specific assignment sale and want more info, just complete the form and we will get back to you with everything you need.
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