How to Invest in Digital Real Estate [+5 Best Land Marketplaces]

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How to Invest in Digital Real Estate [+5 Best Land Marketplaces]

With the rise of the metaverse, interest in digital assets such as virtual land has increased exponentially. Similar to real estate investing in the real world, investors can now purchase digital “land parcels” on platforms such as Otherside, The Sandbox, Decentraland, and more. 

With digital land sold for around $4.3 million in The Sandbox metaverse, many investors have started to wonder how to invest in digital real estate. The market share for metaverse real estate is projected to increase by $5.37 billion by 2026.

The top 10 metaverse platforms have generated $1.9 billion in digital real estate sales. These statistics show the immense potential of these metaverse platforms, with many big brands buying virtual land in the metaverse. These include Estee Lauder, Forever 21, Gucci, Nike, JPMorgan Chase, and many more!

 

Key Points

  • You need an active virtual wallet with enough cryptocurrency to invest in digital metaverse real estate.
  • Deciding on the right platform for your investment is a significant decision. There are several factors that investors should keep in mind, including the number of active users, market demand, financial projections, and more. 
  • Other variables investors should be looking for include; size, value, price, and the land seller.

 

 

What is Digital Real Estate in the Metaverse?

Digital real estate has become an extremely hot commodity in the virtual space. For those wondering how to make money in the metaverse, these virtual spaces can be rented out and sold at higher prices, or users can create different interactive environments.

The piece of virtual land is minted as an NFT (non-fungible token) on the blockchain, thus providing proof of ownership. The land is programmable and represents a defined block of space within the metaverse.

Since it is such a lucrative market, there is also tons of potential for companies like Metaverse Property to offer digital real estate services to investors. Platforms divide their available space into different categories: land for developers, land for platforms, and land to be auctioned off to the public. 

During auctions, virtual land can be sold out within hours. For example, the Otherside land auction generated $200 million within minutes. This led to a massive spike in gas fees, with users paying up to $5k to mint their pieces of land. Users can also purchase land through secondary marketplaces, such as OpenSea.

Why Invest in Digital Real Estate?

For those learning about what digital real estate is, one of the biggest questions is about the benefits of this market opportunity. The metaverse is commonly referred to as “the future of social media” and has become increasingly popular after Facebook’s announcement of building the metaverse in 2021.

This led to massive interest in investment options within the virtual space, with digital real estate prices increasing up to 700% in 2021. This makes it an extremely attractive option for investors looking to get a good return on investment (ROI).

However, it is essential to remember that there are still a lot of unknowns within the virtual space. As with any other investment, prior research is recommended before investing. 

The NFTs provide proof of ownership, and users can flip, lease or build upon these lands. They can also be used for advertising, hosting events, and more. 

How Do Real Estate NFTs Work?

Non-Fungible Tokens, or NFTs, are unique assets registered on the blockchain to provide proof of ownership.

Similar to other NFTs, digital real estate NFTs can be bought using cryptocurrency. The user must link their virtual wallet to the marketplace to purchase the NFT, and upon completion, the NFT can be transferred back into the virtual wallet. 

The primary benefit of real estate NFTs is that it offers users an option to use 3D creation tools to build upon the land. Users can use tools such as VoxEdit to design large buildings, stunning landscapes, and more within the Metaverse. Businesses can utilize real estate NFTs to create interactive virtual worlds to connect with their customers.

As is the case with any other NFT, investors have the option to flip the piece of land for a profit. Virtual land on Metaverse platforms such as Decentraland and The Sandbox is extremely popular at the moment. Therefore, these NFTs can be resold quickly once you put them onto the market.

 

How to Invest in Digital Real Estate

Investing in digital real estate is relatively easy. To become a Metaverse property owner, follow the steps below:

Obtain a Digital Wallet

Digital wallets can allow you to access your cryptocurrencies remotely from any location. Opening a digital wallet is easy; you have to sign up for it, and then you are given a unique code that lets you access the wallet and connect it to a marketplace. You can access the multiple wallets available such as MetaMask, Trust Wallet, Venly, Coinbase Wallet, and Bitski.

Select a Metaverse Platform

Selecting a metaverse platform is a big decision, as it can be a significant factor in determining the success of your investment. It is always recommended to purchase land on platforms with high demand. This is because investors can quickly liquidate their digital assets if needed.

Other important considerations include the price, location, size, and land seller. While choosing a platform, it is also essential to keep in mind the audience using it. 

Select Your Chosen Virtual Land

You will also have to make various considerations when selecting a piece of land in the metaverse. These considerations include size, location, and price of the land (just like when choosing a metaverse platform).

Browse according to your budget and do plenty of research before purchasing. Be wary of unreliable marketplaces and sellers to ensure the safety of your investment.

Link Your Digital Wallet to the Marketplace and Complete the Purchase

The last step is to link your wallet to the marketplace. You can then proceed towards completing your purchase. Multiple extensions on your browser can seamlessly connect the wallet with the marketplace platform. Once that integration is completed, you can easily use your existing crypto to pay for your land. 

 

5 Best Places to Buy Virtual Land

Since most metaverse platforms host land auctions that sell out in minutes, many investors are wondering how to invest in digital real estate.

Metaverse real estate marketplaces consist of both in-game and secondary marketplaces where users can purchase digital real estate using cryptocurrency. 

Follow the list below if you’re wondering where to buy digital real estate:

CryptoVoxels

Origin City is a virtual city in the digital world known as CryptoVoxels. Streets controlled by “The Corporation” and properties owned by individual users coexist in the city. Users can build on land parcels, and features and blocks may be added or removed. Property owners can also designate their piece as a “sandbox parcel,” making it editable and available for construction for everyone. The distance from the center and other popular areas determine the land parcel value. 

Decentraland 

In the 3D virtual platform Decentraland, individuals may explore a sizable digital area and purchase virtual land. The platform has an in-game marketplace that you can use to start buying land. Once in the marketplace, you can browse through the map and select what land parcel you’d like to purchase. Users require MANA (Decentraland’s digital asset token) to buy land through this marketplace. Investors can quickly obtain MANA from crypto exchanges, such as Binance. 

The Sandbox

Investors can browse through different available land parcels within The Sandbox Marketplace. The sale, however, will be made through OpenSea, where users can purchase land parcels using Ethereum (ETH). Users must link their wallets to the marketplace to complete the transaction.

Treeverse 

The Treeverse has been built by Loopify and allows users to complete challenges in a “fantasy” themed setting. This pixelated metaverse experience was very popular in 2021, with over 10,000 Founders’ Plots sold out within minutes of their launch. Investors can purchase land parcels for the Treeverse from OpenSea.

Worldwide Webb

Investors can browse through the Worldwide Webb collection on the OpenSea marketplace. In this metaverse, virtual lands are areas people own and govern that may be used to host social gatherings, games, pets, and avatars. Users may even be able to include their smart contracts and sell their works of art through their land parcels.

how to invest in digital real estate

Centralised VS Decentralised Metaverse Platforms

The difference between centralized and decentralized platforms is simple. A single entity controls centralized platforms, has restricted freedom, users cannot buy digital assets, and there are controlled parameters. Examples include Fortnite and Roblox.

Decentralized platforms promote user-led creation by empowering the community to have total freedom to make decisions and shape experiences. Users can buy or sell digital assets, and a single entity does not make decisions. Examples include Otherside, Decentraland, The Sandbox, and Axie Infinity.

Is the Location of Virtual Land Important?

Yes, similar to property in real life, virtual location is significant in the metaverse. As mentioned earlier, the proximity to the center and popular areas determines the property’s price in the virtual space. A prime example is the $450,000 sale of virtual property simply because it was next to Snoop Dogg’s virtual land in The Sandbox.

 

Is Investing in Digital Real Estate Safe?

While it may seem like a good choice because of the rising interest in the metaverse, there are still a lot of unknowns in this space. It is very difficult to predict the future potential of these platforms as the concept is still in its infancy. Since there is no government or banks involved to provide security for your investment, investing in metaverse real estate is a risky option. 

Takeaways

Metaverse real estate has shown massive potential recently and can be an extremely lucrative option for investors. If you’re looking to become a virtual land owner and to benefit from the rising hype around the metaverse, you can follow the steps mentioned in this article. It is also highly recommended to do your research before you invest to ensure that you make a well-informed decision. To learn more about how to buy virtual real estate in the metaverse, click here.

FAQs

  • What is the Cheapest Metaverse Real Estate Land?

CryptoVoxels is a metaverse platform that currently has land with the cheapest cost for metaverse real estate. The cost of the land available on this platform is as low as 1.899 ETH, which, when converted into dollars, becomes $2,685.

  • How To Invest in Metaverse Real Estate?

Investors can purchase metaverse real estate from in-game or secondary marketplaces, such as OpenSea. Investors must have an active virtual wallet with the required amount of cryptocurrency to begin buying.

  • Is It Worth Buying Land in the Digital Metaverse?

While there are a lot of risks involved with purchasing land in the metaverse, investors have an excellent opportunity to earn incredible returns. With land prices increasing by over 700% in 2021, the market potential simply cannot be ignored. 

This post from Metaverse Insider aims to give information and provide access to information to investors to help them make their own decisions and is not meant to be interpreted as investment advice.

References

Virtual real estate in the Metaverse is booming, be a part of it now! (indiatimes.com)

How to buy real estate in the metaverse | Laptop Mag

Digital Real Estate: How To Buy Land In The Metaverse In 4 Steps (sensoriumxr.com)

Is Investing In Digital Real Estate Safe? (yahoo.com)

Real Estate in the Metaverse: A Few Risks to Know Before Investing | ArentFox Schiff (afslaw.com)

Location, Location, Location: Investing in Real Estate in the Metaverse (coindesk.com)

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