What does it mean if a property is under contract?

When a property is under contract, it signifies that the buyer and seller have reached a mutual agreement regarding the terms of the sale, and a legally binding contract has been executed. However, this status indicates that the agreement is not yet finalized; there are still contingencies that could affect the transaction, such as inspections, financing, or other required actions that need to be satisfied before the sale can be fully completed.

At this stage, while both parties are committed to the sale, the transaction is still in progress. The property may be taken off the market in practice, but legal completion of the sale hinges on the fulfillment of the contract conditions. Thus, it is important for both parties to understand that although they have a deal, certain processes remain before the transfer of ownership is finalized.