Do you ever find yourself curious about the size of the metaverse property market? Finding any information on it takes a lot of work. The information resides in a variety of locations across the web. That’s why we went and did the legwork to compile all the data we could find about the online real estate market and present it to you here.
For many companies, claiming a piece of “digital real estate” means gaining a new platform to promote their products and interact with consumers. One of the next big things is commercial real estate in the Metaverse. Virtual malls are developed by landowners, who then sell or lease them to businesses that want to sell products or advertise online like real-world malls.
According to the most recent State of Web3 report by a leading blockchain analyst, the value of blockchain-based VRE has increased faster than that of traditional real estate. Compared to the growth of real estate prices, virtual real estate prices increased by an astounding 879% between September 2019 and March 2022.
Also Read: Top 10 Companies Working on Metaverse Projects Worldwide
There is a clear difference between virtual and actual property. Spaces for habitation, work, study, and rest are fundamental to the survival and flourishing of the human race. Instead, commercial, recreational, and social pursuits characterize real estate in the Metaverse.
According to the report, token-gated communities and exclusive events are two of the biggest draws for NFT real estate. Sales of digital land are proportional to interest in buying it.
Adidas, Burberry, Gucci, Nike, Samsung, and Louis Vuitton are just some of the brands that have recently purchased parcels of land in the Metaverse to establish permanent stores. In February, JPMorgan was the first major bank to enter Decentraland by leasing a plot of land for the full year, and in March, HSBC bought a plot of land.
Around that time, JPMorgan published a report estimating that the metaverse market would generate annual revenues of over $1 trillion by 2030.
My name is Almira Lopez; I act like a CMO and think like a boss. I’m a Metaverse marketing strategist, and this is the best place for you to learn about Metaverse and how to market it all. So if that sounds good to you, you’re excited?
So, let’s get started!
Key Metaverse Real Estate Stats
- Total land sales in the top ten virtual worlds have reached $1.9 billion.
- Land in the virtual world TCG World sold for $5 million, making it the most expensive sale in the Metaverse.
- The ten largest metaverses contain a total of 622,436 land plots.
Metaverse Property Cost on The Sandbox and Decentraland
The potential for advertising, Metaverse marketing, socializing, and entertaining on virtual land is limitless. Corporate headquarters, billboards, and casinos where 3D avatars can play online games are all examples of real estate being constructed in this virtual world. Collectability, platform popularity, and market sentiment are just a few other factors that contribute to a piece of land’s value beyond the experience it provides.
Recent market data from MetaMetrics Solutions predicts that the value of digital real estate will increase at a compound annual growth rate (CAGR) of 31% between 2022 and 2028. And all this is due to Facebook’s announcement that it would change its name to Meta in June 2022, signaling its interest in the Metaverse.
When considering the potential of real estate investments, look no further than Decentraland. Sam Hamilton, the Decentraland Foundation’s director of creativity, had said, “When we first sold land, it was all sold at $20 [€20.50] a pop, and we sold all of it. The lowest price I’ve seen is $3,500 (or €3,591). This clearly shows that the speculators have profited greatly.
The 116-parcel digital land sale set a new record in 2021, fetching the equivalent of $2.49 million. Tokens.com, the buyer, purchased a property on Fashion Street in Decentraland to enter the digital fashion market.
Hamilton says that what you do with the land is what matters, not the land itself. “Just like in the real world, there are certain areas of the city that are more in demand than others, and if you can park your experience there, it’s much more valuable than somewhere else on the map, such as where all the nightclubs are or where all the casinos are.”
Also Read: Shopping Brands in Metaverse – Top Retailers in the Metaverse
In 2021, there will be 65,000 transactions in virtual land worth $350 million in The Sandbox, making it the largest virtual world in terms of transaction volumes. For those interested in gaming and other virtual experiences, it’s a virtual land comprised of 166,464 parcels of 96x96m, representing a virtual world of 40km x 40km.
On average, players spent about $5,300 on land in both virtual worlds. However, the report notes that prices have skyrocketed since the release of the Sandbox Alpha in the fourth quarter of 2021, from an average of $100 per land in January 2021 to $15,000.
The average monthly land sale price was 3.5 ether (ETH), or about $13,000, between November 2021 and January 2022. As of January 2022, the average cost to buy land in the Metaverse was over 5 ETH, or over $18,000.
Where Does Virtual Real Estate Take You?
A ” land ” token represents a digital chunk of the Sandbox metaverse. Players who invest in real estate can then furnish it with games and assets, the latter of which are digital tokens made by other players or companies that curate user-generated content.
The primary function of these items is to improve the user’s experience or to provide game developers with additional material for their use in game development; they are later traded as non-fungible tokens (NFTs) on various marketplaces.
Also Read: How Many Metaverse Projects are There – List of Biggest Metaverse Projects 2023
Landowners can create unique gaming environments and offer them to other players for free or for a fee. If you own a piece of cyber property, you have the right, per the CFTE, to “Make signs to advertise on or build a museum to house NFTs. One primary advantage of property ownership is the ability to set up a dedicated environment for developing immersive digital content. Players will explore the Sandbox at leisure and be drawn to more central or well-known locations.
Just like in the real world, landowners can charge for the use of their properties so that others can create their games, hold events, and otherwise socialize there.
Where Can You Buy Metaverse Real Estate?
Virtual land purchases can be made directly through the platform or through secondary marketplaces such as OpenSea and Rarible.
As the CFTE points out, however, even though primary sales frequently occur on the Sandbox platform, it is becoming increasingly unfeasible for most people to purchase (un)real estate in this manner. The report claims that the secondary market is the most common choice for purchasers.
How Much Is Metaverse Property Worth?
The market value of the virtual property is sensitive to supply and demand, but it generally continues to rise. For only $20, you could bid on a plot of land in the first auction held by one of the “big four” owners of metaverse real estate, Decentraland, in 2017. In 2021, they cost $6000, and by early 2022, they were selling for around $15000. In the Metaverse, a plot’s pixel count determines how many yards by yards a parcel is.
The potential cost of a property in the Metaverse has no ceiling in light of the platform’s growing popularity. Typically, home prices range from $6,000 to $100,000, but there are always exceptions. As an example of a major sale, a property(link is external) adjoining Snoop Dogg’s parcel in the Sandbox was purchased for $450,000.
What Impact Will Virtual Property Have on the Market?
Major shifts are on the horizon for the property market due to the advent of the Metaverse. For instance, here are a few possibilities:
In turn, this attracts more potential buyers and sellers of real estate. A wide range of sizes, locations, and prices are available in the Metaverse’s real estate market. It accepts a variety of currencies for payment. Due to its low cost and ease of access, almost anyone can become a shareholder.
Size and location are prioritised over practicality: Size, location, and functionality are crucial in the real estate market. Buying land in the Metaverse is to turn it into development or rent it out. There is an emphasis on dimension and location at the expense of practicality.
It can be used as a base for doing things in the real world: Trade shows, exhibitions, weddings, and other social gatherings may become more commonplace on the Metaverse. This could lead to a decline in the need for traditionally constructed buildings serving the same functions.
Also Read: Creative Metaverse Startup Ideas for Entrepreneurs
Should You Buy Virtual Land in the Metaverse?
Buying property in the Metaverse seems like a great idea right now. Prices increased 300 percent in four years, making this an attractive investment opportunity.
Real Estate in the Virtual Worlds of the Future
Since one can purchase (virtual) land worth hundreds of thousands of dollars with just the click of a mouse, the CFTE claims that buying virtual real estate is easier than buying physical real estate.
