How to Buy Metaverse Virtual Real Estate 2022 Guide

The metaverse is still a young phenomenon. A lot of risks come with investing in it. However, given the equally significant potential for high returns, it might be worth the risks. But before you decide to take risks, you must conduct your due diligence, just as with all other investments and business ventures.

We provide you with a thorough overview of metaverse real estate in this article. Find out what it is, how it operates, what risks and difficulties you might encounter, and how you can turn it into a profitable investment.

Why Is Metaverse Real Estate Important?

Property in virtual worlds is known as metaverse real estate. They are pixels in the most basic sense. They’re not just digital images though; they’re much more. They are programmable areas in virtual reality platforms where users can interact socially, play games, advertise NF-Ts, attend meetings, attend virtual concerts, and perform a variety of other virtual tasks.

Digital real estate is anticipated to increase and develop along with the metaverse’s growth. In fact, the last quarter of 2021 saw a boom in the price of metaverse real estate as a result of Facebook’s name change to META and declaration of a dedicated interest in the metaverse. The value of metaverse real estate is anticipated to grow at a CAGR of 31.2% from 2022 to 2028 as its ubiquity increases.

What Are the Metaverse Real Estate Marketplaces?

Today’s most important marketplaces include Deceltraland, CryptoVoxels (now called Voxels), the Worldwide Web, Treeverse, and The Sandbox. Plots can also be bought on other platforms, and as more people become aware of the advantages of buying in the metaverse, more platforms will probably become available.

Since Ethereum can be used to make purchases, it may be simpler for new buyers to buy real estate at this time since most land is sold on the secondary market or through third-party marketplaces. Some marketplaces allow users to pay with their own cryptocurrency. It’s not difficult to switch to different coins if necessary, for instance, The Sandbox uses SAND and Decentraland uses MANA.

When comparing prices, details, and the precise location of a piece of land you’re interested in buying, you should conduct yourself in the metaverse exactly as you would when consulting a city map or a real estate broker’s website. You can make wise purchasing decisions thanks to the comparable data that real estate marketplaces offer for each plot.

The ability for friends, family, coworkers, associates, customers, and even celebrities to visit and interact with one another by merely logging into their computer is another feature that metaverse real estate plots offer that no real-life plot does. There is no need for travel time, flights, or traffic. You and the people in your network can access your metaverse properties at any time, anywhere.

Why Purchase Metaverse Real Estate?

Users can meet online contacts through the use of metaverse real estate. People can play games and interact on their digital property. By charging for access or selling their NFTs, creators can earn money off the content of their works. Brands can promote their services, stage virtual product launches, and offer distinctive customer experiences by using their virtual properties. These land parcels that have been digitally recorded present a lucrative opportunity for real estate investors. Like in the real world, metaverse properties can be built, flipped, or leased. Metaverse real estate has a wide range of potential applications.

What Can You Use Virtual Land For?

Many have charged some investors with fostering a speculative NFT market as the price of virtual land has surged to record highs. However, the hype is being fueled by more than just price rumors. A chance to monetize virtual items and experiences taking place there is what land in the metaverse means to many other users. From renting to managing metaverse land, some of the revenue-producing trends playing out include:

Flipping Land

Users have the option to buy a piece of virtual real estate and resell it for a profit.

Building Infrastructures

Many users choose to construct a variety of virtual properties on a plot of land rather than leaving it undeveloped, either for themselves or for other users to use. This includes online casinos, bars, concert halls, NFT galleries, shops, and much more.

Brokering

Due to the growing use of land NFTs, specialized real estate brokers have emerged who, like in real life, connect sellers with potential buyers or simply give clients advice on how to manage their metaverse properties.

Advertising

The metaverse is becoming a more valuable place for advertising as areas with high foot traffic become more and more valuable. Owners of that land may rent it out and permit businesses to use it to advertise their goods and services.

Events and Services

Our current online experiences will be enhanced by the metaverse, while new ones will also be produced. So, to host events and run services, land in the metaverse is used. Metaverses like the Sandbox encourage users to develop and share educational games and activities that the community as a whole can use.

A number of well-known businesses, such as PwC, Sotheby’s, JP Morgan, and HSBC, are now utilizing the metaverse as an addition to their physical operations, enabling customers to access services and communicate with employees almost exactly as they would in the physical world. In fact, a plethora of financial players have begun investigating additional avenues for making money in the metaverse by investigating consumer lending, lending for virtual real estate, metaverse mortgages, and crypto transactions.

How Much is Metaverse Real Estate Worth?

In December 2017 at the Terraform Event, Decentraland held its first LAND auction, with a parcel of land going for just $20. In 2021, these parcels fetched over $6,000 on average. Prices have soared to about $15,000 per LAND token by the beginning of 2022.

Businesses have been heavily investing in virtual land properties due to the optimistic outlook for metaverse growth. For $1.7 million in October 2021, the blockchain technology firm Tokens.com purchased 50% of the virtual estate firm Metaverse Group. The Republic Realm set records in November when it paid a record-breaking $4.3 million for a house in The Sandbox.

Prices have gone up even more as a result of the increased demand for metaverse assets. Digital land typically sells for between $6,000 and $100,000, though some deals are reportedly going for even more. A house next to Snoop Dogg’s in The Sandbox was one of the biggest purchases last year. It reportedly sold for $450,000 to an anonymous buyer.

How to Buy Virtual Land in the Metaverse

The same NFT sales rules apply to buying and selling virtual property. This shouldn’t be too difficult, normally. The majority of metaverse platforms can be quickly accessed through a desktop platform, providing potential buyers with an overview of the land that is currently available as well as key information like location, total area, average prices, utility potential, and transaction history.

Once you’ve decided on a plot of land you’re interested in buying, you can either look at the metaverse’s own marketplace or a secondary NFT platform like OpenSea and Binance NFT. Keep in mind that land in the metaverse is traded as NFT, and as a result, the title to the property is recorded on a blockchain. Owners are better protected from fraud and other calamities as a result.

Before proceeding with any purchase, make sure you go through the following steps:

1. Open a Digital Crypto Wallet

The majority of metaverses demand cryptocurrency ownership in order to conduct transactions. It goes without saying that you will need a digital wallet to store your virtual money and any other digital assets you may have. Depending on the metaverse platform you use, the wallet you select will vary. We advise you to take into account a digital wallet that can be directly incorporated into your web browser for the best possible experience. MetaMask and Binance Chain Wallet are two of the best digital wallets. Make sure it supports the currency of the virtual project you intend to invest in, regardless of which cryptocurrency wallet you choose. Platforms for the metaverse typically outline which are preferred and how to link them.

2. Buy Cryptocurrency

You will need enough of the in-platform currency for your metaverse, as was mentioned in the previous step, to complete transactions. On exchanges like Binance, Coinbase, or KuCoin, you can buy some of the most well-liked currencies like $MANA, $SAND, and $ETH with ease.

3. Select a Metaverse

Before committing, you might want to weigh your options, unless you already have a specific virtual land project in mind. Virtual lands are sold on reputable platforms like Decentraland and Sandbox using tokens called MANA and SAND, respectively. The size of the land and its extent will differ from metaverse to metaverse. You should be able to quickly and easily check information like price, overall size, and the current owner during this step.

4. Confirm Your Purchase

You can simply go to the marketplace in the metaverse (or a different platform) and click buy once you have your virtual currency in your virtual wallet and have chosen a piece of land. Your NFT should be visible in your wallet once your real estate transaction has been authorized and completed. Additionally, you will be listed as the new owner of the property. From here, you can choose to hold onto your property for a while, construct something on top of it, or re-list it and sell it again – hopefully for a profit.

Where to Buy Metaverse Real Estate?

The Big Four are the primary owners of metaverse real estate. Decentraland, Sandbox, Somnium Space, and Cryptovoxels are some of the key participants in the metaverse economy. These platforms are the owners of 268,645 parcels, many of which are among the most expensive ones available.

Sandbox

With a market share of roughly 62%, Sandbox currently rules the metaverse real estate. Right now, the average price of land in this area is $11,000, with premium lots going for between $20,000 and $30,000. Virtual spaces can be purchased or rented for a variety of purposes. There are various sized family homes, businesses, art galleries, and hangout areas.

Everything on the UGC-voxel platform is created by the community for the community. Voxel works are purchased, sold, and traded by sandbox creators and players. On the LAND they purchase, they construct experiences. They can also make money off of these experiences by using NFTs and SAND, Sandbox’s utility token.

The Sandbox has partnered strategically with brands like Shaun the Sheep, investors like Square Enix, game developers like Atari, and musicians like Snoop Dogg over the past few years. As a creative space and as an investment platform, it now has greater appeal thanks to these partnerships.

Decentraland

The Ethereum blockchain was used to build the 3D VR platform Decentraland. Through LAND NFTs that include the precise grid coordinates and a link to the parcel’s specifics, ownership of land parcels is indicated. Users must have MANA tokens in order to buy LAND, and these tokens can also be used to buy goods and services in-world.

Each district in Decentraland’s virtual world has its own special type of content, and they are all grouped together as a whole. To interact, view, and share content, users can move around these areas. These districts provide creators and brands with more targeted traffic, allowing them to reach more niche audiences with their content.

Cryptovoxels

You would feel at home at Cryptovoxels if you’ve been playing Minecraft. You buy land in this virtual world and use monochromatic blocks to construct structures there. Add colors and other elements to your designs to make them more unique. These items can be bought with native $COLR tokens. The platform also includes built-in chat, avatar, and editing tools.

Creators and brands can buy digitized land on which to erect galleries and shops showcasing their carefully curated offerings. At Cryptovoxels, a lot currently costs $5,000 on average, but depending on the size and location of the property, costs can reach over $10,000. Land ownership is permanently recorded on the Ethereum blockchain, just like it is for other virtual worlds.

Somnium

A blockchain-based virtual reality metaverse called Somnium Space was entirely created by the users. Users can access the 3D virtual world on desktops and mobile devices, providing them with immersive VR experiences.

Small, medium, and extra-large parcels make up the virtual space. To create your own space, you can choose from waterfront or roadside properties. You can import items like avatars and earn money from your digital assets.

Somnium has tokenized its real estate and in-game items. On the Solana and Ethereum blockchains, ownership is verified and documented. The average cost of a parcel in Somnium Space is $11,500. In February 2022, the priciest lot went for $43,100. If you want to buy a parcel but don’t have the money, you can still buy a smaller parcel for $2,000 to $4,000.

More than a dozen platforms now sell metaverse lands in addition to the Big Four. Aavegotchi, Bit Country, Star Atlas, and Axie Infinity are some additional options.

How to Choose Which Parcels of Land to Buy on the Metaverse?

Similar to real estate, location is important when choosing a virtual land in the metaverse. As major companies like Atari, Samsung, Miller Lite, and Adidas stake their claims on these virtual worlds, parcels in The Sandbox and Decentraland continue to rise in value. Many early purchasers of lots close by or adjacent to them have profited greatly from their investments.

If you intend to invest in metaverse real estate, search for locales with growth potential. The value of locations will be greater than those in uninteresting areas where people might not congregate. Think about lots that are close to developed areas but outside of them. These properties are available for relatively less money, so you can buy them, build on them, and then wait for the value to rise.

Statistics on Metaverse Real Estate

We have gathered the most recent market data to assist you in making a data-driven decision about whether to invest in metaverse properties or not. Examine these figures to determine whether investing in metaverse real estate is worthwhile.

• 2021 saw a 15,000% increase in sandbox LAND. With a total of $350 million for 65,000 transactions in virtual land, it also had the highest transaction volume during the same year.
• Sales of metaverse real estate on the four major platforms totaled $501 million in 2021; this year, sales are projected to double to $1 billion.
• The same market, estimated by a research study to be worth $47.69 billion in 2020, is expected to generate $828.95 billion in revenue by 2028.
• From $1,265 to $12,684, the average cost of a parcel on the most popular metaverse platforms has increased.
• Investments in metaverse real estate come from just 25,000 unique crypto wallets.

The majority of metaverse real estate statistics seem to be encouraging. They indicate massive gains for early “settlers” on the virtual platforms. Though these worlds are brand-new and not yet fully developed, you must keep this in mind. Even though the statistics may be alluring, you might need to look deeper and further.

Risks and Challenges of Investing in the Metaverse

Although the metaverse is predicted to expand significantly over the coming years, it is still a young field that is far from being stable. One is that all of your properties and other assets on a metaverse platform vanish if it is permanently shut down.

The issue of valuation is yet another. A land’s artificial scarcity and unknowable future value raise the question of how to value it. Metaverse land is vulnerable to volatile conditions because its value depends on extremely volatile cryptocurrencies.

Big Risks With Potentially Big Rewards

Considering all the unknowns, investing in metaverse properties is more speculative than prospective. The risks are substantial, and that is understating it. You can quickly lose all of your investments in the virtual world. A large return on investments in metaverse real estate, however, may also be possible given the quick transition to full digitalization in almost all industries.

Gather as much information as you can about the metaverse before making any investment decisions. Recognize every danger and difficulty, and balance it with any potential advantages. Making a choice should only be done after carefully weighing all the advantages and disadvantages.

In Conclusion

Similar to how physical property’s supply and demand drive up or down property prices, digital real estate appears to function in a similar way. Additionally, metaverses have a limited supply of land, which means there are special investment opportunities.

Before investing in metaverse real estate, it is essential to conduct research because digital assets like virtual land are still very speculative and carry increased risks for both novice and experienced investors.

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