Navigating Assignment Sales: Pre-Construction Property in Niagara, Hamilton, and Calgary

Selling PreConstruction before Completion - Assignment SaleIf you're thinking about selling your pre-construction property before it's finished, also known as an assignment sale, you might be curious about the process and what to plan for. Whether the developer will allow you to sell before completion depends on their rules and the terms in your purchase agreement. Some developers may permit assignment sales, while others might have restrictions or require approval for such transactions. It's crucial to carefully review your contract and seek guidance from a knowledgeable Pre-Construction Realtor to understand their policies on assignment sales and navigate the process smoothly.

Why Consider Pre-Construction?

When you buy a pre-construction unit, you secure the right to 100% ownership of the unit by paying only a fraction of its total cost upfront (the downpayment).

In pre-construction, the downpayment is divided into installments according to the deposit structure over the construction period.

Typically, the downpayment is 20%, with a common deposit structure looking like this:

$5,000 on signing
Balance to 5% in 30 days
2.5% in 120 days
2.5% in 180 days
2.5% in 420 days
2.5% in 540 days
5% on occupancy

The key takeaway is that you only need to pay a portion of the unit's total cost throughout the construction phase.

If you've decided to sell your pre-construction property and transfer it to another buyer, here's what you should be aware of.

What does Assigning Mean?

Selling a pre-construction unit before it is constructed is known as assigning. Essentially, you are transferring the contract, or the right to take possession of that specific unit in the future, to another individual.

Many investors successfully use this strategy to achieve significant returns on their investments.

Avoid a Mortgage And Closing Costs by Assigning your Pre-Construction Unit

By assigning your unit, you can avoid the need for a mortgage and the burden of paying closing costs or other expenses, such as development charges, utility fees, interim occupancy fees, and land transfer tax.

This investment strategy involves identifying a project expected to appreciate in value during construction, allowing you to make a solid return on your investment by selling before completion. This way, you avoid additional expenses.

While you won’t benefit from any future gains on the property, you also won't have to handle the carrying costs or the hassle of finding tenants to cover those expenses.

Will all Builders Allow you to Re-assign the Pre-construction Property?

The more complicated answer to this question is 'it depends'. When or if you can assign your pre-construction unit will depend on the contract you signed when you purchased it. 

Some builders do not allow the transfer or assigning of pre-construction properties to others. It's important to carefully check your purchase agreement or contract with the builder to see if transferring ownership is allowed. Builders may have specific rules or limitations regarding property transfers, so it's vital to understand their guidelines before considering any changes. While many pre-construction units allow free assignment, some will require a fee paid to the builder. Even with the free assignments, there will be the legal cost of transferring the unit to the new owner. 

If you're uncertain, it's advisable to seek advice from your real estate agent or legal counsel. The real estate agents at The Hendriks are well-equipped to assist with navigating these complexities due to their expertise in pre-construction real estate.

Finding a Buyer for your Pre-Construction Property | Assignment Sale

When you're looking to invest in pre-construction properties or assign your current unit, it's essential to team up with a seasoned Real Estate Agent. The Hendriks Team stands out for their wealth of knowledge and experience in this area, making them a top choice for navigating pre-construction properties. Assigning a pre-construction unit is similar to a re-sale property (a home that is already built). You will need to attract buyers, negotiate an offer, and then agree to a deal. 

Can I List my Pre-Construction Assignment unit on MLS?

Most developers do not permit assignment sales to be listed on the MLS or sites like Realtor.ca. Therefore, you will need to explore alternative methods to attract buyers. Fortunately, specialists like us have an extensive network of buyers who are always searching for assignment sales.

What Happens Once you Find a Buyer for your Pre-construction Property?

Legal Documentation: At The Hendriks Team, we offer in-house services to simplify the creation of legal paperwork for the assignment procedure. Our skilled team guarantees precise drafting and signing of all essential contracts and agreements, making it easier to transfer rights and responsibilities from the initial buyer to the assignee. With our thorough legal support, you can confidently navigate the intricacies of the assignment sale process with assurance and tranquility.

Closing: On the deadline day, our internal team manages everything from facilitating the transfer of funds to supervising the signing of closing paperwork. With our knowledge and skills, we guarantee that the closing occurs smoothly and in compliance with all legal standards. By relying on us to handle the closing procedures, you can feel confident that the property ownership transfer will be seamless, enabling the buyer to take possession of the pre construction property without encountering any difficulties or setbacks.

Here's Why Working with us is a Smart Choice

Extensive Knowledge of the Pre-construction Market: The Hendriks Team has a deep understanding of local market dynamics, emerging trends, and the intricacies of assignment sales. We live and work in these areas, allowing us to stay updated on the latest developments, builder agreements, and legal requirements. This local presence ensures that our clients receive the most informed guidance, tailored to the specific nuances of the Niagara, Hamilton, and Calgary regions.

Access to Exclusive Listings: As seasoned professionals, we have access to exclusive pre-construction listings and insider information about upcoming developments. Leveraging our network and resources, we help clients identify lucrative investment opportunities tailored to their preferences and investment goals.

We will negotiate for you: Negotiating assignment sale terms requires finesse, strategy, and effective communication skills – qualities that define our team. We advocate for our clients' best interests, skillfully negotiating to secure favorable terms, maximize sale prices, and protect their investments throughout the process.

Marketing Strategies: At The Hendriks Team, we have unique marketing strategies to promote pre-construction properties effectively. From compelling listing presentations to targeted online campaigns, we showcase the unique features of each property and attract qualified buyers through various channels.

Legal Guidance and Due Diligence: Our agents work closely with legal professionals to ensure that every assignment sale transaction adheres to legal requirements and safeguards our clients' interests. We conduct thorough due diligence, review contractual obligations, and address any legal concerns to facilitate smooth and legally binding transactions. Our team of top professionals will help to negotiate the terms of the assignment sale with the assignee, including the sale price, deposit amount, and any other relevant terms.

Comprehensive Services All Under One Roof: The Hendriks Business Centre is your starting point for the exciting journey of pre-construction homeownership. Conveniently located in the heart of St. Catharines, we offer a wide range of services all in one place. Whether you need help with pre-construction mortgages, financial planning, insurance, or legal matters, we're here to make the process easier for you.

Personalized Support:  Throughout the assignment sale process, we provide personalized support, regular updates, and clear communication to our clients. We are committed to addressing their questions, resolving challenges, and keeping them informed at every step, fostering a positive and stress-free experience.

Schedule Your Assignment Sale Consultation Today!

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