Presale Assignments Explained

What an assignment actually is

When you buy a presale, you sign a contract with the developer. An assignment is when you sell that contract — your rights and obligations — to a new buyer before completion. The new buyer (the "assignee") steps into your shoes. They pay you for the contract, take over the remaining deposits, and complete the purchase with the developer at closing.

You, as the original buyer (the "assignor"), get back your deposits plus whatever premium the assignee agreed to pay. That premium — the difference between your original purchase price and what the assignee pays — is your gain. Or your loss, if the market has moved against you.

Assignments aren't publicly listed the way resale properties are. Many trade privately through agent networks. Some do appear on MLS, but finding them requires knowing where to look — which is one of the reasons working with an agent who's active in the presale market matters.

When assignments make sense

The most common reason to assign is a change in circumstances. You bought a one-bedroom two years ago and now you have a kid on the way. You need to relocate for work. Your financial situation changed and you're not sure you can complete. Life moves, and the assignment clause is your exit.

Some buyers also assign for gain — they bought early in a project that appreciated during construction, and they'd rather take the profit now than complete the purchase and deal with GST, mortgage qualification, and carrying costs. This is less common in the current market than it was a few years ago, but it still happens on well-located projects.

What the developer has to say about it

Not all presale contracts allow assignment. Some prohibit it entirely. Some allow it but require the developer's written consent. Some charge an assignment fee — $5,000 to $10,000 is common, sometimes a percentage of the purchase price.

Read your contract carefully before you assume you can assign. If the assignment clause matters to you — either as a potential exit or as a strategy — confirm the terms before you sign the original contract, not after.

The tax picture for the assignor

This is where things get complicated, and where a lot of buyers are caught off guard.

Since May 7, 2022, GST applies to the assignment fee — the profit above your original purchase price. That's 5% on the gain. Your intent at the time of purchase matters to the CRA: if you bought intending to assign for profit, the entire assignment may be treated as a business transaction, meaning the full price (not just the gain) could be subject to GST, and the profit taxed as income rather than a capital gain.

BC's Home Flipping Tax also applies to assignments where you've held the contract for less than 730 days. The tax is on the profit and phases out between 365 and 730 days of ownership.

Get an accountant involved before you assign. The CRA has specific teams that audit BC real estate transactions, and assignment sales are a known focus area. Don't assume you know your tax position without getting a written opinion.

The tax picture for the assignee

If you're buying an assignment — purchasing someone else's presale contract — you pay the assignor's original price plus any assignment premium. PTT is calculated on the total amount paid at completion. The newly built home PTT exemption can still apply if the home qualifies.

The first-time buyer GST rebate is trickier. It's available on assignments, but only if the original purchase agreement was signed on or after May 27, 2025. If the assignor signed before that date, you don't get the rebate. This is a real issue for assignments of contracts that were signed before the new rebate came into effect.

What to check before buying an assignment

Confirm the developer consents (or that consent isn't required). Get a copy of the original contract — you're inheriting all of its terms, including the deposit schedule, completion date, and any developer rights to modify the unit. Understand exactly what deposits have been paid and what's still outstanding. Have a lawyer review everything before you commit.

And check the developer's track record. Buying an assignment on a project by an unfamiliar developer that hasn't broken ground is a different risk profile than buying an assignment on a nearly-complete building by an established builder.