Virtual real estate is a rising market following the advancement of Web3. The renewed interest in the idea of the metaverse, a platform that aims to connect the digital and physical world using virtual and augmented reality, also thrust this new industry into the spotlight.
This rediscovered curiosity for this platform came after Facebook rebranded itself as Meta, which also caused prices of virtual plots to soar as much as 500%.
While owning virtual lands might not seem a practical way to invest money, there are meaningful and sensible reasons why investors are clamoring to get a piece of property in the metaverse.
This article will explore what real estate looks like in the metaverse and some of the reasons why people are buying plots of land in this virtual world.
Explaining Real Estate in the Metaverse
The virtual real estate industry works the same way as its real-world counterpart: you can buy, sell, and lease any property you want for a price. Browsing for metaverse property is also similar to looking for real estate in the physical space.
In the natural world, you’ll look for a property in a country, state, or city that you believe will be most beneficial for you. For virtual real estate, you can choose which metaverse platform you would like to make your purchase.
What makes them different is the space these industries operate in (virtual vs. physical world) and the flow of their transactions.
In the real world, you would need physical money to purchase your desired property. But in the metaverse, purchasing virtual real estate is similar to how one would buy or sell non-fungible tokens (NFTs).
In that sense, virtual land properties are bought using cryptocurrencies like Ethereum and MANA. And instead of a deed or contract, you’ll receive a unique piece of blockchain code as your proof of ownership for your metaverse property.
One thing you should note before purchasing your first virtual land is that no organization is regulating it (at least, not right now). That means there are unknown risks that could affect your potential investment in the space. Make sure you’re only transacting with trusted people during your transactions.
Why Are People Purchasing Virtual Plots?
Anyone can purchase a piece of virtual land in the metaverse, but it can be especially beneficial for those who want to invest in some cutting-edge technology or promote their businesses.
Take a look at how this rising market opens up investment opportunities and other reasons why people are buying virtual lands in the metaverse.
It Offers a Major Investment Opportunity
With the advancement of technology, many people consider the digital world as important as the physical world. It’s why companies continuously increase their technological investments, which include interest in virtual real estate.
Notable brands and personalities have entered this space, namely Adidas, Samsung, JP Morgan, Snoop Dogg, Paris Hilton, and Sara Sampaio. These names could influence more big-ticket entrants to join the venture into the metaverse and increase the value of virtual properties.
A recent Citi GPS report also predicts that this corner of cyberspace will have as many as five billion users and a market capitalization of over $13 million. If this expectation comes true, prices of existing parcels of digital land will skyrocket whether or not the plot is fully developed.
Recreate Digital Learning
A great thing about owning virtual land is that you can do pretty much whatever you want with it. You can decorate it, host events, play games, and socialize with other people in the space. Businesses can even use their plot to run their advertisements.
Another progressive opportunity one can do in their virtual land is to develop it as a center for people who want to come across a new kind of learning experience. This is the venture that MetaCollective, an immersive campus in the metaverse, is hoping to achieve when they snapped 23 parcels in The Sandbox platform.
The group sees their virtual property as a means to recreate the digital learning experience with their vision of having virtual classes. These lessons aim to teach people the foundational elements of Web3, while also providing specialized learning opportunities that cater to students’ interests, creativity, and passion.
A Chance for Better Community Engagement
With the growing number of people spending more time online and the growth of blockchain technology, the metaverse is expected to be the new place for people to converge, interact, and consume content.
For brands, that means they can create campaigns that are more interactive and engaging for their target audiences. Celebrities can also use their plots in the metaverse to reach wider audiences when they perform or interact in the space using their avatars.
Another notable example of increasing community engagement is seen in Pooja Entertainment’s goal of creating unique immersive viewer experiences. The Indian production company, whose virtual space is known as Poojaverse, seeks to strengthen its connection with audiences and fans through this space.
The entertainment company also wants to establish Poojaverse as the “go-to space for quality entertainment and various aspects of filmmaking in the digital world.”
Virtual and augmented reality trends in real estate, along with technological advancements, are the driving force behind the growing digital property industry in the metaverse. It might not be the same as brick-and-mortar properties, but it still offers great opportunities for businesses and individuals to improve their lives both in the digital and physical space.
Still, one should keep a fair amount of caution about this developing sector. Like other blockchain-based industries, virtual real estate is still incredibly unstable. Therefore, people who want to try their hand at this new endeavor should make sure they are ready to accept crushing setbacks as they are to hope for enormous gains.