It seems everyday that we are answering this question; What is an Assignment Condo? If you have never heard of an assignment condo, don't worry, your not living under a rock, it's NORMAL. We get asked this question almost everyday because it is a very specific real estate niche that neither the Public or Agents know much about.
Whether you are buying or selling an assignment, there are benefits for all parties. With an assignment, you are not buying a unit that is registered on the Land Registry System. Rather, you are buying the Purchase and Sale agreement that was formed between the Developer and the Original Buyer. You are buying the "right" to own a condo that will be registered in the future.
Now here is some confusion. A Condo may be purchased via an Assignment and all you get is the paperwork. However, "Occupancy" and "Legal Title" are different. You can purchase the paperwork and even have access to the suite if occupancy is ready. When "Legal Title" transfers to another buyer through the Land Registry System, then it is no longer considered an Assignment.
So with the legalities out of the way, here are some benefits for Buyers & Sellers of assignments:
Benefits for Buyer:
- Lower Price then what is offered by the builder.
- Larger Selection of suites since most Assignments are not allowed until the majority of the Builders Inventory is depleted.
- A Mortgage is NOT registered until Final Closing. (Not to be confused with Occupancy)
Benefits for Seller:
- Ontario Land Transfer Tax and Toronto Land Transfer Tax is avoided.
- A mortgage is never started. Only the deposit is used.
- Interim Rent is avoided.
These are only some of the benefits and we highly recommend them. Now that you know some of the benefits, stay tuned for part 2 of this blog post and find out Negative Points of Assignments.
If you need any help or have any assignment questions, let us know and discuss it in detail with one of our Specialized Assignment Agents.