- Buyers, and even some marketing materials, describe these deals as buying a unit "on resale" because someone other than the builder is the seller.
- When you complete an assignment purchase, you step into the assignor’s position under the original agreement — taking on the remaining obligations to the builder, such as paying the…
If you’re buying a "resale" pre-construction condo unit in Ontario — one that hasn’t closed with the builder yet — you’re not actually completing a normal resale transaction, no matter how the deal is described colloquially. You’re buying an assignment: the original purchaser’s contractual rights and obligations under their agreement with the builder, not a registered, titled property.
This distinction isn’t just technical. It changes what documents you need, what protections apply, and what risks you’re taking on. This article explains what’s actually happening when you buy a condo unit before registration, and how it differs from an ordinary resale.
Why It’s Called "Resale" When It Isn’t One
Buyers, and even some marketing materials, describe these deals as buying a unit "on resale" because someone other than the builder is the seller. But legally, before a condominium is registered, there’s no separate, titled unit yet to transfer through the ordinary land registration system. What the "seller" — the assignor — actually holds is a set of contractual rights and obligations under their original agreement of purchase and sale (APS) with the builder, and that’s what changes hands through an assignment.
Assignment vs. Registered Resale
| Assignment (pre-registration) | Registered resale | |
|---|---|---|
| What you’re buying | The original purchaser’s contractual rights under their APS with the builder | Registered title to a completed, titled unit |
| Who else is involved | The builder, whose consent is typically required | No third-party consent needed beyond standard closing mechanics |
| Closing structure | Typically an assignment closing plus the builder’s own final closing | A single closing between buyer and seller |
| Due diligence focus | The original APS terms, the builder’s consent process, and the building’s construction/registration status | The condominium’s status certificate, reserve fund, and existing corporation records |
| Deposit history | You step into deposits already paid by the assignor | Not applicable in the same way |
What You’re Actually Acquiring
When you complete an assignment purchase, you step into the assignor’s position under the original agreement — taking on the remaining obligations to the builder, such as paying the balance owing and meeting the closing requirements, in exchange for the right to eventually receive the unit once the condominium registers and the builder’s final closing occurs. Until that final closing happens, you don’t hold registered title.
Documents and Due Diligence Specific to This Kind of Purchase
- The original agreement of purchase and sale between the assignor and the builder, including any amendments
- The builder’s disclosure statement, and any documented material changes to it
- Confirmation of deposits already paid to the builder, and what remains outstanding
- The builder’s assignment and consent terms, including any fees or marketing restrictions
- The building’s current construction status and anticipated registration timeline
This is a different due diligence list than a standard resale condo purchase, where the core document is typically the condominium corporation’s status certificate for an already-registered building — a document that doesn’t exist yet for a project that hasn’t registered.
Why the Builder Still Matters After You’ve "Bought" the Unit
Because you’re stepping into the original agreement rather than receiving a clean transfer, the builder remains a live party to your transaction until final closing. Their consent is generally required to complete the assignment in the first place, and their construction, disclosure, and closing processes continue to govern the deal until the unit registers and the final closing with the builder is complete.
Frequently asked questions
If I’m buying an assignment, do I need a status certificate like a regular resale buyer?
No — a status certificate applies to an already-registered condominium corporation. For a pre-registration assignment, the relevant documents are the original agreement with the builder and the disclosure statement, not a status certificate.
Can a realtor handle an assignment purchase the same way as a normal resale?
A realtor can help you find and negotiate an assignment deal, but the legal structure is materially different from a registered resale, and the agreement terms need review by a lawyer — realtors aren’t licensed to give legal advice or interpret binding contract terms.
Do I get the same protections buying an assignment as buying directly from the builder?
You generally step into the assignor’s existing rights and obligations under their original agreement, which may include statutory protections tied to that original purchase, such as new-home warranty coverage once the home is built. But the assignment itself is a separate transaction with its own terms — have your lawyer confirm exactly what carries over in your specific deal.
Is buying an assignment riskier than buying a completed resale condo?
It involves different risks, not necessarily greater ones — more moving parts, such as builder consent, construction timelines, and a double closing — but also, in many cases, the same underlying builder protections that applied to the original purchaser. Careful legal review is the way to understand your specific situation.
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