An assignment sale is not a resale with extra paperwork — the assignee is buying a contractual position, and almost everything that follows from that fact surprises clients who have not done one before.
Key takeaways
STEP 01 OF 10
Start every assignment conversation from the legal reality, because it is not what most clients assume: the assignee "is buying a contractual position, not the unit itself, and eventually takes title from the builder once the building is ready" (assignment sales and title ownership in Ontario). See assignment of agreement, defined. This single fact reframes everything else on this list — the assignee’s relationship is with the original agreement and the builder, not simply a purchase from the assignor the way a resale would work.
STEP 02 OF 10
"Most original purchase agreements with the builder address assignment directly, and very few permit it freely" — some prohibit it outright, others require written consent, sometimes with a consent fee payable to the builder, and terms are contract-specific (treadstonelaw). Read this clause before marketing anything — an assignment that the builder has not consented to is not a deal you can actually close.
STEP 03 OF 10
This is explicitly flagged as genuinely complex, and the source declines to generalize: whether HST applies to assignment profit "turns on your original intent when you signed the pre-construction contract and how CRA characterizes the transaction," and "getting it wrong is one of the costliest mistakes" (treadstonelaw). Route this to an accountant or tax lawyer on every file — do not state a blanket "HST applies" or "HST doesn’t apply" rule to a client, because neither is accurate as a general statement.
STEP 04 OF 10
Ontario gives buyers of new residential condominiums a statutory cooling-off period — "a window of 10 days after you receive the signed agreement and the disclosure statement," running from TRESA’s predecessor framework under the Condominium Act, 1998, during which the purchase can be cancelled for any reason with the deposit returned (the pre-construction condo survival guide). This window applies to the original purchase from the builder — not to an assignment itself — but a client asking about assigning a unit they bought days ago should be told this window exists and may still be open.
STEP 05 OF 10
A buyer who takes possession before the building is legally registered pays a monthly occupancy fee that "typically approximates (a) interest on the unpaid balance of the purchase price, (b) an estimate of the municipal property taxes for the unit, and (c) an estimate of the monthly common expenses" — money that generally does not reduce the balance owed at final closing (treadstonelaw). This period "can last months — sometimes much longer" depending on how quickly the building registers, and it directly affects the economics of any assignment negotiated during it.
STEP 06 OF 10
Tarion’s statutory warranty runs "up to 7 years even if the home is sold," with coverage maximums that changed over time: before February 1, 2021, freehold and condo units were each capped at $300,000; from February 1, 2021 to June 30, 2023, freehold and condo stayed at $300,000 with common elements rising to $100,000 per unit (capped at $3.5 million) and environmental damage to $50,000; from July 1, 2023 onward, freehold rose to $400,000 while condo units stayed at $300,000, with the same $100,000-per-unit common-elements structure (Tarion — the new home warranty). Confirm which band applies by the unit’s enrolment date, not the date you happen to be advising the client.
STEP 07 OF 10
A builder needs a builder’s licence; a seller needs a vendor licence; a business doing both needs both — and "a person building a home for their own use on land they own may not require a builder’s licence, provided they do not sell the home after construction," but an owner-built home under that exemption "is not eligible for warranty coverage under the Ontario New Home Warranties Plan Act (ONHWPA)" — the coverage Tarion administers (HCRA — do I need a licence?). Check this before marketing any pre-construction or assignment unit — a client assuming Tarion protection on an owner-built home may have none.
STEP 08 OF 10
"Deposit-protection limits and the warranty framework are set by regulation and change over time" — confirm the current maximum directly with Tarion or HCRA before quoting a figure to a client, rather than assuming a number from memory (treadstonelaw). The worked example below shows how the common-elements cap specifically can bind harder than a per-unit figure suggests once a building passes a certain size.
STEP 09 OF 10
Final closing happens once the building registers, title transfers, and the mortgage funds — and a long interim-occupancy period is a real financing risk: "Your mortgage pre-approval from when you signed may have expired by final closing, and rates or your finances may have changed," while "Builders can also assign a final closing date on relatively short notice once the building registers" (treadstonelaw). Build a financing-readiness check into your file well before the building is expected to register, not after the builder’s notice arrives.
STEP 10 OF 10
Do not let the builder-consent question or the HST question get absorbed into the general transaction paperwork — both are fact-specific, both need a professional’s sign-off (the builder’s for consent, an accountant’s or tax lawyer’s for HST), and both are exactly the kind of thing a later dispute will ask you to show you actually addressed.
The disclosure-package review that applies to any new-construction purchase applies with equal force to what an assignee is stepping into: the developer’s disclosure statement can run "hundreds of pages," and a lawyer reviewing it looks specifically at the proposed declaration, by-laws and rules, the budget and estimated common expenses, the reserve fund plan, whether a first-year budget deficit exists and who covers it, and the developer’s own right to make changes to the building or the timeline (treadstonelaw). An assignee inherits the deal the original purchaser signed onto — walk them through what that disclosure statement actually said, not just the resale-style listing sheet.
Treating an assignment like a resale with an extra signature. The assignee is buying a contractual position, not the finished unit, and takes title from the builder, not the assignor. The legal shape of the deal is different from the outset.
Marketing an assignment before confirming the builder’s consent terms. Most builder agreements restrict assignment or require written consent, sometimes with a fee. A deal built on an assignment the builder has not actually agreed to is not a deal that can close.
Stating a blanket HST rule to a client. Whether HST applies to assignment profit is fact-specific and turns on the assignor’s original intent — treadstonelaw’s own guidance declines to generalize it, and neither should an agent.
Quoting a Tarion coverage figure from memory. The caps changed across three date bands between 2021 and 2023. Confirm the figure that applies to the specific unit’s enrolment date directly with Tarion rather than repeating a number that may belong to an earlier band.
Skipping the disclosure-statement review because "it’s just an assignment." An assignee steps into the same builder agreement and disclosure statement the original purchaser signed — the same by-laws, budget assumptions and developer discretion clauses apply. Treating the file as a simple resale skips exactly the review that matters most.
Both figures below come directly from Tarion’s own published July 2023-and-after coverage structure — $100,000 per unit, capped at $3.5 million overall. The only step performed here is the multiplication.
Scenario A — a 30-unit building. $100,000 × 30 units = $3,000,000. That is under the $3.5 million ceiling, so the full $100,000-per-unit figure applies without adjustment.
Scenario B — a 40-unit building. $100,000 × 40 units = $4,000,000 — but the ceiling caps total common-elements coverage at $3,500,000 regardless. Spread evenly across the building, that ceiling works out to $3,500,000 ÷ 40 = $87,500 of effective coverage per unit, not the full $100,000 the per-unit figure implies.
The cap starts binding at exactly 35 units — $100,000 × 35 = $3,500,000, precisely the ceiling — so any building larger than that is, by definition, receiving less than $100,000 of common-elements coverage per unit on a pure per-unit basis. Both figures are Tarion’s own published maximums; the unit counts are illustrative, and any specific building’s real unit count should be confirmed against the current Tarion figures directly.
Tarion’s coverage maximums are not one fixed number — they changed materially across three date bands, and the applicable figure depends on enrolment date, not on when the file is being reviewed.
All three bands are Tarion’s own published figures (tarion.com); the tier that actually applies to a given home is fixed by its enrolment date and does not update retroactively when the caps change.
No, and it is not always exempt either — it depends on the assignor’s original intent at the time of purchase and how CRA characterizes the specific transaction on the facts. Route this to an accountant or tax lawyer on every file rather than stating a general rule.
Tarion states coverage runs "up to 7 years even if the home is sold," which is the general survival rule for the statutory warranty — but confirm the specific treatment of an assignment (as opposed to a completed resale) directly with Tarion or HCRA before representing it to a client as settled.
Both roles are licensed separately: a builder needs a builder’s licence, a seller needs a vendor licence, and a business doing both needs both. An owner-builder building for their own use may not need either — but then loses Tarion eligibility entirely.
It is the informal name for the monthly occupancy fee paid during interim occupancy — before the building is legally registered and title can transfer — approximating interest on the unpaid balance, estimated property taxes, and estimated common expenses. It does not reduce what is owed at final closing.
The statutory cooling-off period runs from when the original purchaser receives the signed agreement and disclosure statement from the builder — it is a feature of that original purchase, not a right that resets for an assignee stepping into the contract later. Confirm the specific mechanics with a real estate lawyer before assuming either way on a live file.
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