Buying an Assignment vs a Resale Home in Ontario
The short answer
Buying an assignment means taking over someone's pre-construction purchase contract before the building closes — you may get a newer unit and the original (possibly lower) price, but you inherit deposit and HST complexity, builder consent requirements, and financing that can be trickier. Buying a resale home is simpler and more certain: you purchase an existing, inspectable home with standard financing and a known closing. Assignments suit buyers comfortable with complexity chasing a specific new unit; resale suits most buyers wanting certainty.
Assignment vs Resale, at a glance
| Assignment | Resale | |
|---|---|---|
| What you're buying | A pre-construction contract, not yet a registered home | An existing, registered home you can inspect |
| Price | Original contract price plus the assignor's premium | Current market price, negotiated |
| Deposits | You repay the assignor's deposits and take over remaining ones | One deposit with the offer |
| HST | Can be complex — new-home HST and rebate eligibility depend on use | No HST on a used residential home |
| Builder consent | Usually required; may carry an assignment fee | Not applicable |
| Financing | Can be harder; not all lenders finance assignments | Standard mortgage financing |
Why buyers consider an assignment
Assignments can appeal when you want a brand-new unit in a specific building that's sold out, or when the original contract price looks attractive versus today's market. You may also move in sooner than a fresh pre-construction purchase because the building is further along. The upside is access and, sometimes, price.
The complexity you take on
- You typically repay the assignor's deposits up front, then take over the remaining deposit schedule — a larger cash outlay than a resale deposit.
- HST treatment on assignments is complex and depends on whether the unit is a principal residence or investment — get tax and legal advice.
- Most builders must consent to the assignment and may charge a fee; some restrict assignments entirely.
- Not every lender finances assignments, so line up financing early.
When resale is the simpler call
For most buyers, a resale home is more straightforward: you see and inspect exactly what you're buying, finance it conventionally, and close on a known date without builder consent or HST-rebate complexity. If certainty and simplicity matter more than getting a specific new unit, resale usually wins. Assignments reward buyers who understand the mechanics and have professional guidance.
Choose Assignment if…
- You want a specific brand-new unit in a sold-out building
- The original contract price is attractive vs today's market
- You can handle a larger upfront deposit and added complexity
- You have a lawyer and lender experienced with assignments
Choose Resale if…
- You want to see and inspect exactly what you're buying
- You want standard financing and a known closing date
- You'd rather avoid HST-rebate and builder-consent complexity
- Certainty and simplicity are your priorities
Key takeaways
- An assignment is taking over a pre-construction contract before closing — access to a new unit, but added complexity.
- Expect to repay the assignor's deposits, navigate HST, and get builder consent (often with a fee).
- Financing an assignment is harder — not all lenders do it, so arrange it early.
- Resale is simpler and more certain; assignments reward experienced, well-advised buyers.
Not sure which is right for you?
Frequently asked questions
What does buying an assignment mean?
It means purchasing someone's pre-construction agreement of purchase and sale before the building registers — you 'step into' their contract, repay their deposits and take over the remaining ones, then close with the builder when the building is ready. It usually needs builder consent.
Do you pay HST on an assignment?
Possibly. Assignments involve new-home HST, and rebate eligibility depends on whether you'll use the unit as a principal residence or an investment. The treatment is complex, so get tax and legal advice before committing.
Is it harder to get a mortgage for an assignment?
Often yes — not all lenders finance assignment purchases, and requirements can be stricter. Line up a lender experienced with assignments early so financing doesn't derail the deal.
Is buying an assignment a good idea?
It can be, if you want a specific new unit or the original price is attractive and you're comfortable with the added deposit, HST and consent complexity. For buyers who prioritize certainty and simplicity, a resale home is usually the easier choice.
Related comparisons
General information for Ontario, not legal, tax or financial advice. Figures describe how each option works, not current rates or prices. Confirm specifics with a licensed professional before you decide.