What does the term 'bilateral contract' imply in real estate?

The term 'bilateral contract' in real estate refers to an agreement in which both parties involved have specific obligations they must fulfill. This mutual exchange of promises is foundational to many real estate transactions, such as sales agreements or leases, where one party agrees to sell or rent a property and the other party agrees to pay for that property or service.

In a bilateral contract, each party's promise becomes the consideration that supports the agreement, creating a binding legal obligation for both sides. For instance, when a buyer commits to purchasing a home, they also expect the seller to convey ownership once the purchase price is paid. This characteristic distinguishes bilateral contracts from unilateral contracts, where only one party has obligations, such as a reward offer where only the party that completes the task is entitled to the reward.

The other choices do not accurately capture the essence of a bilateral contract. Only one party's obligation describes a unilateral contract, which is not applicable here. The notion of a contract without duration, or casual agreements, also lacks the structure and legal bindings that bilateral contracts possess. Hence, the definition related to both parties having obligations is correct, reflecting the nature of these contracts in real estate dealings.