What is a Presale Condo Assignment? A Guide for Buyers and Sellers in British Columbia

Posted on Feb 21, 2025

The real estate market in British Columbia is full of unique opportunities, and one of the most intriguing options is the presale condo assignment. If you’ve ever wondered how investors or buyers resell a property before it’s even built, you’re in the right place.

Understanding Presale Condo Assignments


A presale condo assignment occurs when the original buyer of a presale property (Assignor) sells their rights under the purchase contract to a new buyer (Assignee) before the condo is completed. The new buyer takes over the contract and will be responsible for completing the purchase with the developer.
Essentially, the Assignor is transferring their right to buy the property, not the property itself, because the unit hasn’t been registered yet. This process allows the original buyer to profit from any appreciation in value before the unit is even finished.

How Does a Presale Condo Assignment Work?


To successfully assign a presale contract, the following steps must be followed:
  1. The Developer’s Consent:
    • The original purchase contract often includes restrictions on assignments. Developers generally must approve the assignment before it can proceed.
    • Some developers charge an assignment fee, typically between 2-5% of the purchase price.
  2. Reporting and Compliance:
    • Under the Real Estate Development Marketing Act (REDMA), all assignments must be reported to the Condo and Strata Assignment Integrity Register (CSAIR). This database tracks assignments to prevent tax evasion and speculation.
    • Any profits made from an assignment must be reported as income on the Assignor’s tax return, and the CRA cross-checks this with the CSAIR database.
  4. Property Transfer Tax (PTT):
    • The final buyer (Assignee) is responsible for paying Property Transfer Tax on the total purchase price, including any additional upgrades.


Why Do Assignments Happen?


Assignments can occur for a variety of reasons:
  • Profit Opportunity: If the market value of the presale unit has increased, the Assignor may sell the contract for a higher price (known as a "lift").
  • Change in Financial Situation: The original buyer may no longer be able to complete the purchase due to financial constraints.
  • Life Circumstances: Relocation, changes in family plans, or other personal reasons may prompt an assignment sale.


Are Presale Condo Assignments Legal?


Yes, presale condo assignments are legal in British Columbia, provided that:
  • The developer consents to the assignment.
  • The transaction is reported to CSAIR for tax and regulatory purposes.
  • The contract does not have a prohibition clause against assignments.

The practice of shadow flipping, where properties were flipped multiple times before completion without transparency, led to stricter assignment regulations in B.C. Today, developers and real estate professionals ensure these transactions follow the law.

Key Restrictions and Considerations


For Sellers (Assignors):


  • The original purchase contract may have restrictions on assignments. Some contracts prohibit assignments altogether, while others require developer approval.
  • MLS Restrictions: Many developers do not allow assignment listings on MLS (Multiple Listing Service), making marketing more difficult. A Realtor experienced in assignments is crucial to navigate these restrictions.
  • Assignment Fees: Developers often charge an assignment fee, reducing the potential profit.

For Buyers (Assignees):


  • The Assignee takes on all terms and conditions of the original contract, including any price increases, deposit schedules, and closing costs.
  • The Assignee may inherit the original buyer’s deposit structure, which could allow for a lower upfront cash investment than if they were buying directly from the developer.
  • There may still be an opportunity to select certain finishes and upgrades, depending on the development stage.

Advantages of a Presale Condo Assignment


For Sellers (Assignors):


✅ Avoids closing costs like GST and Property Transfer Tax if the unit is never officially registered under their name.
✅ Reduces carrying costs, such as mortgage payments and strata fees.
✅ Opportunity to profit from real estate appreciation before completion.

For Buyers (Assignees):


✅ Potentially better pricing compared to buying directly from the developer.
✅ Ability to secure a unit in a sold-out project.
✅ Brand-new home with potential customization options if construction isn’t finalized.

Potential Risks and Challenges


🚨 Market Fluctuations: The value of the unit may decrease before completion, leaving the new buyer at a loss.
🚨 Financing Uncertainty: Mortgage approval could be difficult, as lenders may not provide financing until closer to the completion date.
🚨 Developer Restrictions: Some contracts impose strict assignment conditions, including profit-sharing clauses.

Final Thoughts: Should You Consider a Presale Condo Assignment?


If you’re considering selling an assignment, working with a Realtor who specializes in presale assignments is crucial. Not every agent is experienced in navigating developer restrictions, marketing limitations, and legal requirements.

If you’re buying an assignment, make sure you:
✔ Review the original contract carefully.
✔ Understand all financial obligations (deposit payments, closing costs, taxes).
✔ Work with a lawyer or real estate professional to protect your interests.

Presale condo assignments can be a great investment tool, but they come with complexities. Whether you’re an investor looking to profit from an assignment or a buyer hoping to secure a home before completion, knowledge and professional guidance are key to making a smart and secure decision.

Considering an assignment sale? Make sure to consult with a specialized real estate expert to help you navigate the process smoothly!


Reach out Today!



This is not an offering for sale. Any such offering may be made only with a disclosure statement. Prices and specifications are subject to change. E.&O.E. Not intended to breach or induce any existing client relationships. This is not legal advice, recommended to seek independent legal advice. 


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