Yes. You can sell an assignment privately as long as your purchase agreement allows the assignment. You’ll still need the builder’s consent (if required) and a real estate lawyer to prepare the assignment agreement and handle funds. Selling privately saves commission, but you take on pricing, marketing and negotiating yourself.
An assignment gets you a brand-new home, often with a new-home warranty and upgrades, but needs more cash up front and carries appraisal and delay risk. A resale lets you inspect the property and close on a fixed date with a smaller upfront payment. The better choice depends on your timeline, cash and risk tolerance.
Assignment buyers usually pay the assignor’s deposit refund plus profit in cash when the assignment is signed, then get a mortgage on final closing to pay the builder’s balance. Lenders generally lend on the lower of the price and the appraised value at closing, so if the appraisal comes in low, the buyer covers the gap.
Yes, a builder can refuse or restrict an assignment if your Agreement of Purchase and Sale allows it. Most builder agreements require written consent, and many limit timing, charge a fee or ban public advertising, including on MLS. If the agreement is silent, assignments may be permitted, but get a lawyer’s opinion before relying on that.
Assignors typically pay a builder assignment fee (a flat fee or a percentage of the price, set by your agreement), legal fees for their own lawyer and sometimes the builder’s, realtor commission if they use one, and taxes: GST/HST on the profit portion plus income tax on the gain. Your purchase agreement sets the builder’s charges.
Profit from an assignment is often taxed as business income (100% taxable), not a capital gain. Since January 1, 2023, the federal residential property flipping rule treats gains on housing, including rights to buy housing like pre-construction contracts, held less than 365 days as business income unless a life-event exemption applies.
Usually, yes. For assignment agreements entered into on or after May 7, 2022, the assignment of a purchase agreement for a newly built house or condo is generally a taxable supply for GST/HST. Tax applies to the assignment price, excluding the part that reimburses the deposit. In Ontario, that means 13% HST on the assignor’s profit portion.
An assignment sale is when the original buyer of a pre-construction home (the assignor) transfers their Agreement of Purchase and Sale to a new buyer (the assignee) before the property closes. The assignee repays the assignor’s deposit plus any profit, then completes the purchase with the builder at the original contract price.