Risks With Buying on Assignment

Risks With Buying on Assignment

Buying Assignments can generate exceptional investment returns. However, the key is to buy the right one.

Most assignment contracts are over-priced (remember Developers sell them based on the cost of build and future value!).

Some risks to consider when evaluating if an ASSIGNMENT is right for you:

Comparable Pricing

What are comparable units selling for in the resale market? Will the purchase price be in-line if not better than the price of the assignment?

Deposit

How much of a deposit will the Seller require? If there is a long-time to completion, you’ve paid the Seller their deposit as well as a profit up front, and the project gets delayed or canceled, what happens to your money?

Builder

Are they a local builder? Are they a big name in the industry (that cares about their reputation), and what is the likelihood that the Builder will cancel the project? What happens to the deposit? Will I lose out on market appreciation? Does the Builder have a track record of completing their buildings on time?

Purchasing an assignment can be a great option to secure your dream property at an amazing price, but it is important to work with an expert to guide you through the process and mitigate these risks as much as possible.

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