Digital real estate: the first purchase of a home in the NFT
With the development of metaverses and Web 3.0, there has been a boom in NFT. People are ready to buy digital versions of famous brands, art, and more. Gradually, innovation is spreading to other segments, and cryptocurrency is becoming more and more integrated into the traditional banking system. The time has come when digital real estate has entered the market.
An American investor who operates in the real estate sector made a deal to buy a house in South Carolina. Unique, in this case, is that the purchase was made in the form of NFT, its amount was 175 thousand dollars. Roofstock onChain, a company that does business with Web3 tools, took care of the real estate acquisition procedure. This transaction was the first to use NFT, which allowed the purchase of a real estate in just a few clicks.
It should be noted that there are more and more offers in the digital real estate sector. Last year, a seven-story high office building in New York, worth 15 thousand ETH, was also sold as NFT. In addition, in Portugal, an apartment was purchased for 3 BTC, and in this case, there was no conversion into usual money, as it often happens.
We should also mention metaverses, where the purchase of digital real estate also takes place. The process in this case is the same as the purchase of any NFT. You need to have a cryptocurrency wallet with assets on it, it is possible to use the services of intermediaries, such as agents or brokers. However, unlike the physical sector, the metaverse does not have clear rules and regulators, which increases the risk for the buyer, including when contacting specialists.
Despite the fact that many are skeptical about virtual reality, its popularity is hard to overestimate, especially when the numbers speak for it. For example, in 2021 alone, the value of Sandbox’s own LAND token increased 150-fold and continued to grow in 2022. Last year, 65 thousand of virtual real estate and land transactions were made on this platform, and the volume of transactions on such trades amounted to $350 million.
In 2021 metaverse real estate was valued at $501 million, and by the end of 2022, that figure had doubled. On average, virtual properties cost $12,684, and just a few years ago they were offered for $1,265.
Realizing the growth opportunities of metaverses, investors have already begun to actively invest in digital real estate. In this case, it’s important to look at such deals over the long term. Besides, if now a physical piece of land is valued at hundreds of thousands of dollars, its virtual counterpart can cost as little as 10 thousand dollars. Of course, it is still difficult to see all the advantages of physical properties in virtual ones, but in the future, they may bring a good income.