In real estate, an option is a contractual right granted for consideration that allows a person to purchase or lease a property on specified terms within a defined period of time. The party receiving the option has the exclusive right to decide whether to exercise it.
The party granting the option is bound to honor the terms if the option is exercised, while the option holder has no obligation to complete the transaction. Options are commonly used to secure property while evaluating feasibility, financing, or future plans.
