Assignment sales 101

Assignment sales involve the sale of a pre-construction property contract from the original buyer to someone else before the purchase closes. The buyer takes over for the seller in the contract and pays the deposit plus appreciated value/profit. Assignments happen for various reasons, such as life changes, financial difficulties, or investors selling before closing. There are specific pros and cons for both buyers and sellers of assignment sales. For buyers, assignment sales offer the chance to own a brand-new unit without waiting years for it to be finished, less competition, and less worry about the project being canceled. However, buyers also need to have a good chunk of cash and a real estate lawyer experienced in assignments to ensure everything is done right. For sellers, assignment sales allow investors to cash in on the profits before the project is completed, avoid paying land transfer taxes and other closing costs, and avoid dealing with closing, occupancy, or tenants. However, it is harder to sell an assignment than a resale, and there are limits and restrictions on selling. Working with a knowledgeable real estate agent who understands assignments is essential in navigating the complexity of this type of transaction.