What does a real estate option provide a potential buyer?

A real estate option grants a potential buyer the exclusive right to purchase a property at a predetermined price within a specified time frame. This type of agreement typically allows the buyer to secure a property without immediately committing to the purchase, creating flexibility in decision-making. The buyer can assess factors such as market conditions or personal finances before deciding whether to proceed with the transaction while the seller is obliged to honor the agreed-upon price if the buyer chooses to exercise the option.

The exclusive right aspect is crucial, as it ensures that no other party can purchase the property during the option period. This characteristic sets it apart from other types of agreements, such as leases or rental agreements, which do not convey a purchasing right. The option also differs significantly from arrangements that might allow for immediate selling or free rental, as those do not pertain to securing a potential future purchase.