The Frederick · Upper East Village · Laird & Eglinton
If you bought here and now want out before final closing, an assignment is the route. It's not complicated, but it has three or four places where people get caught. Here's the plain-language version, and where you need a lawyer and an accountant rather than me.
Not the condo. You don't own it yet. 25 Frederick Todd Way, The Frederick, is still in interim occupancy and hasn't registered as a condominium, so title can't transfer to anyone until it does.
What you own right now is a contract: your agreement of purchase and sale with the developer. In an assignment you sell that contract. The buyer, called the assignee, steps into your shoes, takes on your obligations, and closes with the developer when the building registers. You typically get back the deposits you've paid, plus or minus the difference between your original purchase price and what the market will pay today. Once the assignment is done properly, your involvement ends.
This is the first thing to sort out, and it's not a formality. Ontario pre-construction agreements almost always require the developer's written consent before an assignment is valid, and there's normally an assignment fee attached, along with conditions.
What the fee is, what the conditions are, and whether consent is even available at your stage depends entirely on the agreement you signed. Two people who bought units in the same tower can be on materially different terms, especially if they bought in different phases or release dates. So the honest answer to "what does this developer allow" is: read your own agreement. Pull it out, find the assignment clause, and have your real estate lawyer read it before you make any plans or promise anything to a buyer.
This surprises people more than anything else on this page. Many pre-construction agreements restrict how an assignment can be marketed, and it's common for MLS advertising to be prohibited while the developer is still selling units of their own. Some agreements allow it with written consent. Some don't allow it at all.
Check before you list, not after. Where public advertising isn't permitted, assignments still get sold, just through a narrower channel: agent networks, buyers already working with agents in the area, and direct outreach. It's a smaller pool and it usually takes longer, which is a real factor in whether assigning makes sense for you.
This is where I stop and hand you to professionals, because the consequences are real and they're specific to your situation.
Three things shift on an assignment. HST may apply to the assignment amount itself. Eligibility for the new housing rebate or the new residential rental property rebate can change depending on who ends up living in the unit and what your intention was when you originally bought. And any profit you make on the assignment is taxable income, with how it's characterized varying by circumstance.
Talk to your accountant and your real estate lawyer before you sign anything. I'm neither, and nothing on this page is tax or legal advice. What I will do is make sure you've asked them the right questions before you're committed.
Worth asking honestly before you start. Assigning gets you out before you have to arrange financing and close, which is the whole point if carrying the unit isn't realistic. The cost is a smaller buyer pool, possible marketing restrictions, and buyers who price in the extra complexity.
Closing and selling as a normal resale gives you the full buyer pool, standard MLS marketing and a much simpler transaction, but you have to get to final closing first and carry the unit until it sells. There's also a third option people forget: close, lease it out, and sell later. The landlord page covers what leasing here looks like right now.
I'll lay out all three with your actual numbers rather than steer you. If you want to understand what the unit itself is worth first, start with how value is read in this building before it registers.
I'm a real estate agent with Big City Realty Inc., Brokerage. General selling process is on the seller page.
Also useful: selling with me and the closing cost calculator.
You are not selling the condo. You are selling your agreement of purchase and sale with the developer. The buyer, called the assignee, steps into your position, takes over your obligations and closes with the developer when the building registers. You typically recover the deposits you have paid, plus or minus the difference between your original purchase price and what the market will pay today, and your involvement ends at final closing.
Almost always yes. Ontario pre-construction agreements generally require the developer's written consent before an assignment is valid, and there is usually an assignment fee and a set of conditions attached. What those are depends entirely on your specific agreement. Pull out your agreement of purchase and sale and read the assignment clause, or have your real estate lawyer read it, before you commit to anything.
Not necessarily. Many pre-construction agreements restrict how an assignment can be marketed, and it is common for MLS advertising to be prohibited outright while the developer is still selling units. Some allow it with consent, some do not allow it at all. Check your agreement first. Where public advertising is not permitted, assignments are marketed privately through agent networks and direct buyer contact instead.
Assignments change the HST picture in ways that catch people out. HST may apply to the assignment amount itself, and eligibility for the new housing rebate or the new residential rental property rebate can shift depending on who ends up living in the unit and on the intention behind the original purchase. Any profit on the assignment is taxable income, and how it is characterized varies with the circumstances. Talk to your accountant and your real estate lawyer. I am neither, and this is not tax advice.
Read your agreement and confirm what it allows. Contact the developer about consent and the fee. Set a price with your agent. Market it within whatever limits your agreement imposes. Negotiate and sign the assignment agreement. Submit it to the developer for written consent. Your lawyer and the assignee's lawyer handle the paperwork and the deposit transfer. Then the assignee closes with the developer at final closing, and you are out.
It depends on whether you can carry the unit and what you would net either way. Assigning gets you out before you have to arrange a mortgage and close, but the buyer pool is smaller, the marketing may be restricted and buyers price in the extra complexity. Waiting means closing the purchase and then selling as a normal resale, with a much larger buyer pool and standard MLS marketing, but you carry the unit in the meantime. I will lay out both paths with your numbers rather than push one.
Tell me the unit and roughly when your final closing is. I'll tell you what I'd want to check in your agreement first and what the realistic paths look like from here.