Let's paint a hypothetical picture:
You’ve been keeping your eye on a vacant lot that you know will be entering a pre-construction sale phase very soon. As you’re saving up for your down payment, you notice the pre-sales open up to the general public. At this point, unbeknownst to you, there have already been two rounds of pre-sales; one for Friends and Family and another for VIP Platinum Agents.
A month or two goes by and you’re mulling over the decision while putting all you can into your savings account for the pre-con down payment (which is structured differently than a resale down payment).
You walk by the site with your pup in tow, and you notice excavation has started and some signs have already gone up declaring “85% SOLD OUT”.
Next thing you know, you return from a work trip with the down payment ready to go and there’s a new sticker on the sign that screams a definitive, "SOLD OUT".
The location was a dream -- is there anything you can do? Fret not!
You can purchase an assignment
One way you can get into a sold out building is by looking for any assignments that may be on the market.
At any time between the Purchase Agreement and final closing, the owner of the condo contract can sell their intention in the unit as an assignment to another buyer.
Buying an assignment means you’re also accepting all of the terms the seller has already agreed to. You’ll be taking over the contract as it stands without the possibility of re-negotiation., Further, there may be an approval process necessary in order for the transaction to go through. It’s a great idea to have a real estate lawyer review the assignment deal before you sign.
Assignment buyers might not have the same leeway with the deposit schedule. Instead, the new buyer will have to pay whatever the seller has already paid into the unit, usually all at once.
Why would someone sell their interest in the unit?
Some investors in hot markets are all about the assignment sale. Once a pre-construction build starts digging out the lot, and every time the building inches near completion with a new floor or phase installed, the unit can increase in value from an outside (resale) perspective.
Seasoned investors know this, and instead of waiting for the building to open, they decide to sell their assignment to someone else, usually at a profit.
So, if you’ve missed out on the pre-sale opportunity, there will likely be times when an assignment in the building goes up for sale. You won’t get that early bird price, per se, but you can still get a better price before the building reaches final closing.
Find out if there's another construction phase
If you’re unable to purchase an assignment, or simply don’t want to, you can always hope there is another construction phase in the developer's plans for the site.
If the development is what’s known as a 'masterplan' community, there could be another tower going up after the first one finishes. Make sure to contact sales agents to find out if there are any future plans or tower proposals for the site of your dreams!
If there are, try to get in contact with a Platinum Agent so you won't miss a beat, this time.