Final answer:
The Statute of Frauds requires most real estate contracts to be in writing to prevent fraud and misunderstandings, thereby ensuring trust in property transactions and supporting economic growth.
Step-by-step explanation:
The law that mandates the need for most real estate contracts to be in writing is known as the Statute of Frauds. This legal rule is critical to the functioning of a stable economy because it serves to clarify ownership and obligations, and thus fosters trust in the property system. The Statute of Frauds is designed to prevent fraud and misunderstandings by requiring certain agreements, including those related to real estate transactions, to be documented in a signed writing.
Without such a legal framework to uphold and enforce contracts, the risk associated with non-payment and transactional disputes would increase, leading to less contractual activity and potentially stymieing economic growth. It's important to recognize that the ability to enter into contracts is a fundamental aspect of property ownership, allowing individuals to use their property to its highest and most productive use.