Last Updated on December 29, 2022 by Jordan Alexo
In a world where technology constantly evolves, individuals must keep up with the latest trends. One such trend that has taken off in recent years is digital real estate. But what exactly is virtual real estate? How does it work? And most importantly, how can you get started without taking on too much risk?
In this article, we will answer all of those questions and more. So whether you’re a complete beginner or just curious about what digital real estate refers to, read on for everything you need to know.
What Is Digital Real Estate In The Metaverse?
People often consider websites, apps, social media accounts, and more when they think about digital real estate. However, the world is dramatically changing, and nowadays, you can buy, sell and hold virtual land in the Metaverse.
Metaverse is a virtual world that several companies are investing so in the future, people can access it through VR glasses or other innovating technologies. For instance, famous singers like John Legend and Tinashe have already done concerts in the digital world. Allowing people with a headset and with tickets to join them.
However, the place where the concert is done is owned by someone. For this reason, the owner can rent his virtual place to singers or other artists to perform.
But before that happens, someone needs to purchase that space, and guess what? That could be you!
Similar to physical real estate, the same fundamentals apply to digital real estate. Also, there’s potential for big profits for the ones who decide to be on the frontier of this brave new world.
But before you cash in, you need to learn the basics, so let’s go more in-depth.
Why Digital Real Estate Selling For Millions In The Metaverse?
Quite a crazy idea when you think people are spending thousands of dollars to purchase a 16×16 land plot on Decentraland or another popular platform. Why would anyone in their right mind want to spend their money on something that doesn’t exist?
At this point, technology is evolving at a pace never seen, and digital real estate may change the financial landscape forever into a new age of decentralized finance (Defi).
Defi stands for decentralized finance, and it’s an umbrella term for a variety of financial products that are built on blockchain technology. These products include everything from lending to insurance to asset management. Defi products are often faster, more secure, and more transparent than traditional financial products.
In a way, a Metaverse already existed with games like Grand Theft Auto, where people could access a virtual world using a computer and role-play their hero.
These virtual worlds also have their cryptocurrency, which you can use to purchase items or hold and let them increase value over time. For instance, with Decentraland, their cryptocurrency is called MANA. Also, for you to get MANA, you need to spend real money.
You can purchase this digital coin through Binance, Crypto.com, or another exchange platform.
NFT stands for Non-Fungible Tokens. People can use these tokens to have a certificate of ownership over virtual items, lands, etc. In a way, this changes the whole ball game! Because once people have NFT over something, no one can replicate the same virtual asset. It belongs to someone, which is why it has a particular value because of its rarity.
For this reason, people buy and sell NFTs such as art, music, land, and more in Decentraland. You can use real money to get MANA and buy a square of land.
What Contributes To The Value Of Digital Real Estate?
This depends on the platform, but let’s talk about Decentraland. One of the oldest virtual worlds where you can own property.
Decentraland is a decentralized virtual world that runs on the Ethereum blockchain. The game uses non-fungible tokens (NFTs) to represent in-game assets such as land, buildings, and clothing.
Anyway, the main factors that contribute to the value of digital real estate are:
One of the most important factors will increase your land plot value. If you have virtual land located in a populated place, the value of that land will most likely increase. For instance, someone can build a business and easily have access to more customers passing there.
A larger virtual land often has more advantages than a smaller one. You can create more experiences and interactions because you have more space to build on.
3) Scarcity and Platform’s Popularity
Platforms’ popularity and scarcity are both connected. The more people you have going to a platform, considering there’s a limited number of virtual lands to buy and sell, the higher their price will be. In other words, you have more demand for the same lands, raising their value.
How Does Digital Real Estate Work In The Metaverse?
Each square of land is its own NFT. This means that land is unique; it has an owner similar to someone owning a land lot in the real world. Once you have virtual land, you can build whatever you want there. Or you can also provide access or denial to anyone.
For instance, you could purchase an empty virtual land lot, and after a few minutes, you have built an apartment. You don’t have all the limitations and regulations compared to the real world.
Another advantage is that you don’t need to go to the title office to exchange your land with someone else. You simply put your land on the marketplace and digitally swap it.
You can build businesses selling items or providing digital real estate services. For instance, you may own a casino where people can use VR glasses.
Sometimes it’s hard for people to imagine the possibility of a digital world like this ever existing. One of the best examples of what they are trying to create is similar to the movie Ready Player One, where players access a virtual reality world called Oasis and participate in a contest.
Why Should You Invest in Digital Real Estate in the Metaverse?
There are several reasons why you should invest in digital real estate in the Metaverse. For starters, the market for virtual land is growing at an alarming rate. In addition, the potential profits to be made are much higher than traditional real estate investments. And finally, digital real estate will only become more valuable as technology evolves.
So digital real estate is the way to go if you’re looking for a high-growth investment with big potential profits. But before you invest, there are a few things you should know. In this article, we’ll teach you everything you need to know about digital real estate in the Metaverse.
- The market for virtual land is growing rapidly, so it’s a good time to invest.
- You can make much bigger profits with digital real estate than with traditional real estate investments.
- Digital real estate will only become more valuable as technology continues to evolve.
- Digital land is a high-growth investment with big potential.
- Still a new technology that will. You can now purchase land for pennies, and in the near future, it will increase in price dramatically.
- At the moment, you have several companies selling land. We don’t know what may happen in a few years. Perhaps, people have abandoned those initial websites and flocked to another main source. This means that those initial lands will lose or not have value.
- Or, perhaps the Metaverse was just pie in the sky. People never gain much interest in purchasing digital land. In the meantime, buying digital assets may be cheaper and have potential in the future; there are no guarantees.
- Furthermore, this investment is still pretty new. You don’t have much information about what you should or should not invest in, making it harder to decide on the right investment. Unlike other types of investment, for instance, stock market investment, you have thousands of online sources. For this reason, you need to do your research and trust your intuition.
But this is the new frontier, and there are no certainties. You may spend some money now and soon become rich or not. It’s like a digital gold rush, and I suggest participating in it as long as you have a few hundred dollars that you can invest without worries.
Certainly, don’t ask for a loan at your bank and risk it all, as happened with some LUNA coin investors. Who invested large sums of money they couldn’t afford to lose and lost it all nearly overnight.
How Can You Start Digital Real Estate Investing?
So, let’s talk about how you can start investing in digital real estate in Decentraland. You can also try other platforms like Roblox, Sandbox, and Uland.
You and others can buy, sell, or rent land plots through their marketplace. They can also build on their land, creating unique experiences for other visitors to the Metaverse.
One of the great things about Decentraland is that it’s easy for beginners. You don’t need to spend much money or have any technical knowledge. Just create an account, buy land, and join the digital land rush!
How To Buy Digital Real Estate?
If you’d like to buy digital real estate in Decentraland, you’ll need to create an account on their platform. You can buy land plots through their marketplace and start building right away! Here are a few tips to start:
1) Get a digital wallet
You need to have a wallet where you save your cryptocurrency, which you will later use to purchase land. I enjoy using Metamask, but you can also try Trust Wallet or Binance Chain.
Make sure the wallet supports the digital coin you need to buy your land.
2) Do Your Own research
Before you buy any land, be sure to do your research! Look at the different districts and neighborhoods in Decentraland to find the best fit for you.
3) Plan ahead
Think about what you want to build on your land and how much space you need. You don’t want to end up with too little or too much space.
4) Pay attention to the terms of sale
Be sure to read over the terms of sale before buying any land. This will help you understand the rights and restrictions associated with the property.
5) Have fun!
Once you’ve bought some land, have fun building and exploring your new virtual world!
How To Make Money With Your Digital Real Estate In Decentraland?
There are a few ways to make money with your digital real estate in Decentraland:
1) Rent out your land
You can rent your land to other people or businesses for a while. Big companies like Nike, Rollex, and Adidas, own land in these virtual worlds. Sometimes they may want to rent your land to build a store and sell their products or NFT, especially if you have your digital real estate somewhere populated.
2) Buying and Selling Digital Real Estate
One of the best ways is to wait until the market crashes because of the volatility. You purchase digital real estate cheaply, hold it until the prices increase, and sell it.
3) Create Your Content
You can create unique experiences and attractions on your land to attract visitors. This is a great way to make money while also having fun!
4) Sell Ad Space
One great way to make money with digital real estate in Decentraland is to sell advertising space. It’s a great way to make passive income in the new digital world. Companies will be willing to pay to place ads on your property if you have a digital asset near a popular area.
Many people think that the future of Metaverse and investing in digital real estate is madness. However, everything started somewhere and often with many doubters. People initially doubted the internet and looked at what it has become nowadays.
Digital real estate in the Metaverse will involve in the future and possibly become a fully functional economy.
You will have droves of people living virtually there, owning land, running businesses, and interacting there daily. I consider this one of the best times to join!
The Metaverse is still in its infancy and the new land of opportunity. You can start today investing in dirt-cheap land that may be worth thousands in a few years.
Please leave it in the comment section if you have anything you’d like to ask or share. Thanks for reading Jordan Alexo’s blog!