What is the primary purpose of a real estate contract?

The primary purpose of a real estate contract is to outline the terms and conditions of a real estate transaction. This document serves as a legally binding agreement between the parties involved, detailing essential information such as the purchase price, property description, contingencies, and obligations of both the buyer and the seller. By clearly defining these elements, a real estate contract ensures that all parties understand their rights and responsibilities, which helps to minimize misunderstandings and disputes during the transaction process.

The other choices, while related to aspects of real estate transactions, do not encompass the core function of a real estate contract itself. Financing is often an essential part of transactions, but financing agreements are separate documents that support the execution of a contract. Similarly, while government approvals may be necessary for a transaction, they do not form part of the contractual agreement itself. Lastly, property taxes are determined separately by local governments and are not a focus of the contractual obligations between buyers and sellers.