As a real estate enthusiast, investor or practitioner- your success or ability to thrive in the real estate industry depends on how frequently you increase your knowledge and skills. We will be deep diving into the technical legal aspects of being a professional real estate investor.
The core of our series will be on legal documents, and knowledge of contracts a practicing real estate enthusiast must be aware of.
First, what is a contract?
A contract is a LEGALLY ENFORCEABLE AGREEMENT between 2 or more parties that creates an OBLIGATION to do or not to do a particular thing.
It is an exchange of promises that the law will enforce.
What are the elements of a contract? We will take each of these elements one after the other and for today we shall focus on the first element.
The first element of a contract is an OFFER
An offer is a promise to act or refrain from acting, which is made in exchange for a return promise to do the same.
A buyer’s power of acceptance is created when the seller conveys a present intent to enter a contract in certain and definite terms that are communicated to the buyer.
Like marriage, acquiring a space (lease or outright buying) is one part love, one part legal transaction, and starts with a proposal. When brokering the transaction for your client making an offer is important: oral promises are not legally enforceable in real estate sale.
Below are 2 more duties you have as an agent to your client:
- Act with prudence in the Client’s interest: You have to put your client’s needs over your personal gain, this way you become known for your integrity and increase your client base.
- Duty to account to the client: Any and all plans to front-load the price of a property must be revealed to the Client (whether buyer or seller). This is part of the Duty to account.