An assignment sale is defined as a sale of the property by a buyer to another person before or during the construction of the property, or during any time before the buyer takes possession.
The benefit for new condo buyers who buy assignments is that they can enter into a deal early and usually get a better price for a property than buying a pre built or pre owned home.
For the sellers of an assignment, they can make money off their investment if they are able to sell their unit at a higher price than what they paid before.
Tips To Consider Royal While Buying An Assignment
Consider a closing date
It is important to know certain milestones before buying a pre-construction assignment.
- Assignment closing date – date on which the assignment sale transaction with the original home buyer is completed
- Occupancy closing date – the first closing date when the buyer gets the condo’s key from the builder.
- Final closing date – when would the the title of the property will transfer to the buyer
- Time to complete the construction – expected timeline of completion of property and move in date
Builder Consent
It is important to have builders’ consent before buying an assignment property. Also note that there will be an assignment fee and administrative fee that will be charged by the Builder on an assignment contract.
Sufficient Funds & Down Payment
Make sure that you have sufficient funds to arrange for down payment of the property. You will be required to pay for the down payment plus the difference between the current asking price by the seller of the assignment.
Don’t rush
It is important to consider all options before investing your money in a presale assignment. make sure that you have done all the research about the project and the developer before buying an assignment. It is a good idea to hire a Realtor® who specialises in buying/ selling presale properties and take care of complex real estate stuff.
Mortgage Approval
Contact your bank to know about your mortgage approval limit. The amount eligible for a mortgage is equal to the original purchase price less the down payment paid to the builder.
Would need to pay for the property as per the payment structure in the assignment contract.
As mentioned, buying a condo assignment can give you financial benefit, but it is advisable to seek professional help before buying an assignment.
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