How to Assign Your Pre-Construction Condo Contract

One key ingredient in any smart investment plan? Having an exit strategy. Think of it like those emergency staircases in high-rise buildings—hopefully, you won’t need them, but you’ll be glad they’re there when things take an unexpected turn.

Let’s face it—life happens. Maybe your financial situation has shifted, and keeping up with deposit installments just isn’t in the cards anymore. Or maybe your life is moving in a different direction: marriage, a new job in another city, or simply a change of heart has you rethinking that pre-construction condo in Brampton (or wherever you bought).

Or hey, maybe you’ve got your eye on a different opportunity and want to shift gears, out of real estate and into something new. So… is there a way out? The short answer is yes, and it’s called an assignment sale.

In plain, everyday terms, this means selling your right to buy a pre-construction condo before it’s officially completed and registered. You’re not selling the unit itself—you’re passing the torch to someone else to finish the deal. And guess what? Assignment sales are not only allowed in Ontario—they’re becoming more and more popular, especially in hot markets.

Curious? Stick around—we’re going to walk you through everything you need to know about how to assign your pre-construction condo contract, step by step.

Understand Assignment Sales

So, what exactly is an assignment sale, & how does assigning a pre-construction condo work? 

When you buy a pre-construction condo, what you’re buying is not a real physical home, but  a promise; there will be a contract with the developer that says, “Once built, it’s yours.” But here’s the bitter truth: life doesn’t like to stick to the plan. That’s where assignment sales come in.

An assignment sale lets you transfer that contract, your right and obligation to buy the unit to be exact, to someone else before the building is registered and ready for closing. Simply put, you’re not selling the condo itself (because it doesn’t technically exist yet), you’re selling your spot in line to someone who’s happy and ready to take it from here.

Here’s the kicker: selling condo assignment doesn’t work like pressing a button; this can only happen if your original Agreement of Purchase and Sale (APS) includes an assignment clause. What is it? A section that permits you to assign the contract. 

Not all agreements include it by default, and some come with strings attached. That’s why it’s super important to read the fine print or, better yet, sit down with a real estate lawyer who knows the ropes.

Now, why would someone want to assign their contract in the first place? Well, plenty of reasons:

• You’ve had to move to another city for work.
• Your family’s growing, and you need more space—or less!
• You’ve had a change in finances and can’t carry the cost.
• The market’s hot, and it feels like the perfect time to sell for a profit.

Whatever the reason, an assignment sale gives you a flexible way to bow out gracefully, without waiting years for final closing. And in Ontario, this condo assignment sale process is backed by regulations like the Condominium Act, 1998 and oversight by Tarion Warranty Corporation, which helps protect buyers and builders.

Bottom line? Assignment sales are perfectly legal, increasingly common, and—when done right—a smart move for pre-construction buyers who need a plan B.

Check Your Agreement and Get Developer Consent

Alright, so you’ve decided an assignment sale might be your best bet. But before you start spreading the word or posting on social media, hit the brakes. First things first: you’ve got to check your paperwork.

Pull out your Agreement of Purchase and Sale (APS)—yes, that stack of documents you probably haven’t looked at since signing day—and flip through it to see if it includes an assignment clause. 

This little section is the golden ticket that gives you the right to transfer your contract. No clause, no assignment—at least not without some serious legal hurdles.

Even if your agreement does allow assignments, don’t assume it’s smooth sailing. Most developers in Toronto or other cities require written consent before you can officially assign your contract. And they don’t just hand it out for free—there’s usually an assignment fee, which can range anywhere from $1,000 to $5,000 (sometimes even more, depending on the builder and the project).

And here’s a heads-up: many developers also prohibit online advertising for assignments without their permission. You can’t just throw your listing up on Realtor.ca or social media and hope for the best—not unless the builder gives you the green light.

This is exactly where a good real estate lawyer, or a VIP or Platinum agent, becomes your best friend. They can go over the fine print, explain your options, and make sure you’re not stepping on any legal landmines. Trust us—it’s worth every penny.

One more thing: don’t you ever try to sneak an assignment sale past the builder. If you go rogue and assign your contract without approval, there will be serious consequences, like losing your deposit or having your contract terminated altogether. Yikes.

Lastly, it’s important to know when you actually get your money. In most cases, the assignor (that’s you!) receives payment—your original deposit plus any profit—once the assignee (the new buyer) takes possession, the developer signs off, or legal title is transferred. It all depends on how the deal is structured.

Benefits & Risks of Assigning a Contract

Of course, like most things in real life and the real estate market, assignment sales come with upsides and a few watch-outs. Think of it like trading in your ticket for a sold-out concert—you might make some money, but you’ve also got to play by the rules.

The Benefits for You (the Assignor)

First, the good stuff. Assigning your pre-construction condo contract can give you some serious flexibility. You don’t have to wait around for the final stage of the preconstruction condo timeline, aka closing date, which—let’s be real—can sometimes feel like it’s light years away.

Here’s what you might gain:

• A clean exit before closing, especially if your life plans have changed.
• A potential profit if the market’s hot and your unit’s value has gone up.
• No occupancy fees or closing costs like land transfer tax or development charges—you get to skip those altogether.

In a fast-moving market, that can be a major win. You’re passing on the baton, pocketing your deposit (plus possibly a sweet return), and walking away without the stress of moving in or taking on a mortgage.

The Risks 

Now, let’s talk about the flip side—because yes, there are a few important things to keep in mind.

• Taxes can hit hard: If you turn a profit on your assignment, you may owe HST and income tax. The CRA doesn’t mess around, so get proper advice and be prepared.
• Developer conditions: Like we said earlier, builders can charge admin fees, limit your advertising, or even say no to your assignment request altogether.
• Market risk: If the real estate market cools off, you might struggle to find a buyer, or end up selling at a loss. Timing is everything.
  

So, what’s the best way to manage the risk? Work with the right professionals, a lawyer who knows pre-construction contracts, and a real estate agent who’s been through assignment deals before. They’ll help you avoid common pitfalls, and maybe even spot opportunities you didn’t know were there.

At the end of the day, assigning your contract can be a smart move, as long as you go in with your eyes wide open and the right support in your corner.

Tips for a Successful Assignment Sale

So, you’ve got the green light to assign your pre-construction condo. Now what? Well, this isn’t just about listing it and hoping for the best—it’s about being strategic and staying sharp. The goal is to make the process smooth, legal, and hopefully… profitable.

Team Up with the Right Real Estate Agent

First things first—don’t go it alone. You’ll want a real estate agent who knows the pre-construction scene in Toronto, or other regions like the back of their hand. Assignment sales are a different beast from resale homes, and experience here really matters.

The right agent will:

• Understand the developer’s rules.
• Help you price your unit competitively (based on market trends, not wishful thinking).
• Know where and how to market your assignment to find serious buyers.

Think of your agent as your assignment wingman—they should guide you every step of the way.

Price It Right

This one’s huge. If you price your assignment too high, it might just sit there collecting dust. Too low, and you leave money on the table. You need that sweet spot. Consider:

• How much similar assignments are going for.
• What stage the building is at (buyers love units close to occupancy).
• What incentives, upgrades, or features your unit has (corner unit? high floor? parking spot? That stuff matters).

An experienced agent can help you strike that perfect balance between value and appeal.

Be Transparent with Buyers

Buyers are making a big decision—so give them all the info they need. Don’t hold back on the details:

• Floor plans
• Deposit schedule
• Occupancy and closing timelines
• Any upgrades you’ve selected
  

The more honest and upfront you are, the more confident buyers will feel—and the smoother the deal will go.

Loop in a Real Estate Lawyer (Again!)

If you haven’t already, get a lawyer involved early, and keep them close until the finish line. Assignment agreements have their own quirks, and a legal pro will make sure:

• All your paperwork (APS, assignment agreement, developer consent) is airtight.
• Your rights and interests are protected.
• You’re fully aware of the tax and legal implications before signing anything.

Better safe than sorry, especially when thousands of dollars are on the line!

Know Your Market

If your unit’s in a hot zone like Toronto, Mississauga, or Vaughan, you might find buyers lining up. But even in slower markets, knowledge is power. Watch for:

• Market trends
• Supply and demand
• Interest rate changes

This will help you time your sale and set realistic expectations. Remember—real estate is part strategy, part timing, and part luck.

Bottom Line

Assigning your pre-construction condo contract might sound complicated at first, but with the right plan, it can be a smart, flexible way to adapt to life’s changes or take advantage of a good market.

Here’s the quick recap:

• Check your contract for an assignment clause.
  Get the builder’s consent & understand their conditions.
  Work with professionals, a real estate agent and a lawyer who know assignments inside and out.
  Understand your tax obligations & potential fees.
  Time it right, price it right, and communicate clearly.

Whether you’re relocating, cashing in on rising values, or simply switching gears, an assignment sale gives you options. Just remember—it’s not a get-rich-quick scheme. It’s a legal transaction with real rules and risks, so treat it like the important deal it is.

If you’re thinking about assigning your pre-construction condo—or just wondering if it’s the right move for you, we’re here to help. Reach out to our expert team at Platinum Condo Deals.