How can the metaverse change real-estate sector?

Highlights

• Property within the digital world is up for grabs, and investors are still speculating if the risk is worth taking.
• The metaverse is in the pre-boom phase, where investments could shoot up exponentially once traction builds.
• As more and more big names attach themselves to the virtual world, investors have further gained confidence in the potential offerings of the metaverse.

The metaverse is gaining momentum not just in the tech sphere but also in the world of real estate. Property within the digital world is up for grabs, and investors are still speculating if the risk is worth taking. However, seeing the vast potential offered by the metaverse, many investors have already taken the leap and invested in metaverse real estate. Therefore, it is worth noting how the digital world competes to the offline real estate realm, and whether the former would now become investors’ go-to option for profit making.

Investing in metaverse real estate is no longer just limited to buying and selling of digital land. Investors are also being offered real-life solutions, such as pooled funds into real estate. Just like Real Estate Investment Trusts exist in the real world, the first REIT has also launched on the metaverse. Therefore, real estate investments would be subject to radical change in the coming year, all thanks to the metaverse.

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Is the trend expected to catch on?

Investors are likely to be on the fence initially when it comes to investing in the metaverse. A couple of bad investments in the virtual world would be enough for dampen investor confidence. Thus, virtual real estate would only catch on, if investors are able to lock in profitable ventures within the metaverse.

More importantly, only those investments would gain in value that are seen as having a potential. Essentially, the metaverse is in the pre-boom phase, where investments could shoot up exponentially once traction builds. Consider buying a patch of land in New York, or in Sydney 50 years ago. The value of that patch of land would have massively increased by today.

Thus, investors would only see profits on those patches of real estate which have a promising future ahead. To better understand this, consider the metaverse real estate as a virtual replica of the real world. Different pieces of land would be used for different purposes, just like we see offline. Thus, only those pieces of land would be successful that have the potential to becomes hubs of virtual traffic or have a solid venture planned on them.

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How can virtual landowners make money?

The essence of metaverse investing lies in the prediction that it would increase in value over the years. At present, some may see metaverse as just a passing fad, that may not transform into something worthwhile.

However, as more and more big names attach themselves to the virtual world, investors have further gained confidence in the potential offerings of the metaverse. The most well-known company in the metaverse real estate arena is Metaverse Group, which is behind the virtual world of Decentraland. The company offers digital estate for sale, which can be bought in exchange for cryptocurrency.

Additionally, revenue generation is not limited to buying and selling of property. Owners also have the option to rent out their land for ads and other purposes. These buzzing opportunities have led to some investors jumping in on the metaverse bandwagon and investing in real estate investor pools.

Bottom Line

Some investors are still questioning the long-term scalability of the metaverse, while many others have already set foot in the new investment venture. However, the hype surrounding metaverse might seem overblown at times, but that does not completely invalidate the investor confidence developing around virtual real estate. Thus, investors should carefully choose their investments in the digital real estate that are devoid of high risks, to churn out profitable revenues.

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