A commitment to acquire a specific piece of real estate, typically for a defined period and under agreed-upon terms, secures the asset for the prospective buyer while allowing them time to finalize necessary arrangements. For instance, a prospective homeowner might secure a newly constructed condominium unit by providing a deposit, preventing other potential buyers from purchasing it during the reservation period.
This practice offers significant advantages to both buyers and sellers. It provides buyers with the assurance that their desired property will not be sold to someone else while they secure financing or complete due diligence. For sellers, it demonstrates a buyer’s serious intent and can contribute to a smoother, more predictable sales process. Historically, such commitments have played a vital role in organized land development and real estate markets, providing a framework for managing demand and facilitating transactions.
