Because a real estate transaction for the purchase of a home is an important and significant event in the lives of most Israelis, The Lands Law established the principle that any commitment to engage in a real estate transaction requires a written document.
The requirement of an agreement in writing emphasizes to the parties the seriousness of the act, and is intended to prevent hasty communication. Because of this principle, it is impossible to carry out a real estate transaction without a written contract. An oral agreement is not valid. It is possible to sue for damages arising from an unfulfilled promise, but it is impossible to obligate the promising party to carry out a real estate transaction.
In spite of the need for a written document, a signature on the contract is not needed. It is enough that the parties agreed that a written document encompasses the terms of their agreement. In addition, it should be emphasized that cancellation of a real estate transaction does not require a written document, and that the requirement of a written document relates only to the transaction itself; however, there is nothing to prevent the oral appointment of a representative to carry out a real estate transaction.
The requirement of a document in writing obligates the parties to draw up a contract that comprises all the important components included in the transaction, including: a description of the property, the names of the parties, the price, and the nature of the transaction. An agreement in which one of these essential elements is not included is not valid. For example, if the price for the property is not included in a contract (or in its attachments), the contract may not be litigated; after all, the courts are not expected to prepare the transaction for the parties. On the other hand, the absence of non-essential details is not critical. The court will view such a document as a binding agreement and will fill in whatever is missing, as provided by law, or in accordance with the customary relations between the parties or what is generally accepted in such matters.