What is the purpose of an option agreement in real estate?

The purpose of an option agreement in real estate is to grant a buyer the right to purchase a property at a predetermined price within a specified period. This agreement provides the buyer with the flexibility to decide whether to proceed with the purchase while securing the property for a certain duration. It benefits buyers who wish to take time to secure financing, conduct due diligence, or assess the market conditions before committing to the purchase. This strategic tool can create opportunities for buyers by locking in terms even before the actual sale takes place. Other options listed relate to different aspects of real estate transactions and management, but they do not describe the specific function of an option agreement.