What defines a purchase agreement in real estate?

A purchase agreement in real estate is defined as a legally binding contract that outlines the terms of the sale between the buyer and the seller. This agreement typically includes essential details such as the purchase price, property description, contingencies, and the responsibilities of both parties involved in the transaction.

The nature of a purchase agreement establishes a formal framework for the sale, ensuring that both parties have clear expectations and obligations. By being legally binding, it protects the rights of both the buyer and the seller, providing a basis for legal recourse should either party fail to uphold their end of the agreement. This formal structure contrasts strongly with verbal commitments or informal assessments, which lack the enforceability and specificity required for real estate transactions.