Metaverse Real Estate Development: Discovering Potential Opportunity

    Tanya Sharma
    Tanya Sharma
    Published on January 21, 2023 11:06 AM

    Updated on January 21, 2023 3:08 PM

    Metaverse real estate is one of the most exciting things that we've been dealing with for some time. It's real estate where parcels of land are sold virtually. This article focuses on how to construct and create opportunities in the virtual world. Continue reading to discover more.
    Metaverse Real Estate Development: Discovering Potential Opportunity
    Source: Unsplash

    For years, the metaverse real estate industry has been in development. Some of the world's major corporations and shops are already purchasing land and constructing virtual properties. These early adopters purchasing virtual assets are eager to lay the groundwork in the metaverse in order to outperform their competitors.

    The metaverse is still in its infancy. Investments in it are extremely risky. However, given the equally high potential of large gains, the risks may be worthwhile. Nevertheless, like with any other investment or business venture, you must undertake a thorough study before deciding to accept risks. But there is a fresh twist to it now.

    If you're unfamiliar with the concept of metaverse real estate, you're undoubtedly left with a few questions. If you're interested in learning more about the metaverse real estate market, keep reading.

    What is metaverse real estate?

    In the metaverse, real estate refers to land plots as well as residential and commercial structures that exist in a virtual setting. On that site, you can construct any type of property, including billboards for advertising, commercial districts, and even company offices.

    The metaverse is nothing more than pixels on your computer screen. Many platforms, on the other hand, have been designed to be programmable settings in which users can socialize, exchange non-fungible tokens (NFTs), play games, promote their goods and services, and even attend meetings using 3D avatars.

    The value of a digital real estate is expected to rise as the metaverse expands. In actuality, after Facebook changed its name to META and expressed a specific interest in the metaverse, there was a surge in metaverse real estate in the fourth quarter of 2021. 

    As its popularity grows, the price of metaverse real estate is expected to rise by 45.2% CAGR from 2020 to 2025.

    Real estate prices in the metaverse

    The cost of real estate in the metaverse is skyrocketing. Take the example of Decentraland. The platform held its first auction in December 2017, selling land parcels for $20 each. This product's price skyrocketed to $6,000 by 2021, and it continued to grow until it hit $15,000 at the start of 2022.

    The Sandbox, a distinct metaverse platform, saw a 15,000% increase in virtual acreage in 2021.

    Prices for virtual land parcels can vary substantially depending on their size, platform, and location. A simple property on Decentraland currently costs $2.4 million, whilst one in Somnium Space can cost up to $6,362.

    Real estate opportunities in the metaverse

    Property in the Metaverse can be built, purchased, and sold much like regular real estate. Owners of virtual land or space can easily rent it out to others.

    Transactions in the Metaverse are significantly less complicated than in traditional real estate because customers may identify suitable properties, conduct paperwork, and communicate with brokers and agents from the comfort of their own homes. Users can also buy metaverse land and then rent it out.

    Because of these characteristics, Metaverse real estate is far more versatile. Users can easily acquire a parcel of land and convert it into any form of facility, such as a school, store, gallery, or event space. The potential for developing ROIs for real estate firms in this sector is considerable.

    Real estate management in the Metaverse

    Property management is an attractive opportunity for digital real estate metaverse enterprises. The virtual world, like real estate in the actual world, has potential. There is enormous potential for metaverse real estate expansion regardless of the type of firm or asset. 

    Important services, in addition to allowing users to acquire land in the metaverse, include:

    • Customer property management.

    • Management of visual and technological property.

    • Variety of rental items.

    • Contact for any client-related issues or queries.

    Real estate development in the Metaverse

    You can offer full-stack property development services in the metaverse. Working with a metaverse real estate development firm can help you construct a profitable business model.

    The blockchain corporation can help you with your real estate growth, and you can use the time you save for other vital duties such as:

    • Making plans for your construction.

    • Making a construction plan.

    • Enhancing your strategy and designs.

    • Making a development map.

    How do you build real estate in the metaverse?

    The component level of metaverse real estate development comprises phases such as infrastructure construction, content creation, and lastly establishing the operating logic via protocols.

    However, this only creates the structure for the property. The digital infrastructure should provide a variety of services to metaverse consumers. The following step will be to populate the properties with materials such as design, layouts, assets, and a variety of activities.

    The final step is to define the operating standards and protocols. These would outline the applicable laws and regulations, as well as business logic such as buy-sell agreements, rental contracts, and so on.

    Step 1: Select a platform

    Creating real estate in the metaverse necessitates a diverse set of skills. Before you do anything else, you must decide on a platform for establishing your real estate metaverse. All major blockchain technologies, including Ethereum, Polygon, Algorand, Solana, and others, already provide the groundwork for building a democratic and community-driven virtual world.

    This indicates that a blockchain-based metaverse is backed by the capabilities of a smart contract, which requires certain actions to be conducted in response to specific circumstances. We demand decentralized finance for full functionality, which is why cryptocurrencies and NFTs must be enabled.

    You can use those platforms to create real estate properties within existing blockchain metaverse platforms such as Decentraland, Sandbox, and others. The key to developing a larger and more specialized platform is to start from scratch and add real estate properties.

    Because existing metaverse platforms are still in their infancy, it is recommended that you build your own metaverse real estate software from the ground up, using the capabilities and features of your choice.

    A qualified metaverse real estate development company, such as ours, can always assist you by expediting the process.

    Step 2: Create a smart contract for the metaverse.

    A metaverse smart contract is a set of unchangeable "rules" that trigger specified actions when certain conditions are met. The capacity to start a transaction between a buyer and a seller when both parties click "Agree" is one aspect of the smart contract.

    Smart contracts can also be used to specify and carry out two-party leasing agreements. This includes canceling the agreement if the renter violates any of the rules or standards.

    Step 3: Create the metaspace of your choice.

    Following the selection of the metaverse digital real estate platform, the next logical step is to build the metaspace.

    Metaspaces include apps, virtual conference rooms, virtual meeting rooms, and even virtual home theatres. Metaspace, a virtual environment, can be entered by a user wearing a VR headset. After the platform has been completed, the idea for the metaverse real estate property emerges. It comprises creating the architecture of the building.

    Step 4: Create an interaction layer.

    The construction of the interaction layer comes next. You are currently creating the application logic that will allow assets and characters to interact with the metaverse's digital real estate.

    This layer governs accessibility, navigation, communication protocols, and user controls. An easy example is when a person enters the main gate of a real estate company, such as an event hall, using an access pass.

    At this layer, the integration with external apps must be specified. For video calling, for example, gadgets such as Zoom, smart glasses, virtual reality goggles, headsets, haptic gloves, sensors, and so on are required.

    Step 5: Construct an interoperability layer.

    Interoperability broadens the reach of the metaverse, which likewise broadens participation. For example, a user in one metaverse may wish to purchase and attend an event taking place within a piece of real estate in the other.

    Interoperability across several underlying blockchain systems is critical to accomplishing the same goal.

    If you want to build a completely functional virtual world, you must encourage cross-environment transactions. Choose a blockchain that allows for speedy and secure payment gateway transactions.

    Are there any risks associated with virtual real estate in the metaverse?

    There are possible risks with virtual real estate, just like there are in traditional real estate. Though rapidly gaining popularity, metaverse real estate is still in its infancy and has a long way to go before being stable.

    Consider what would happen if a platform in which you had invested went permanently down. Your investments and properties are rendered ineffective. Another issue is the issue of valuation. A recurrent challenge is determining how to value a piece of land with artificial scarcity and an unknown future worth.

    Because its value is based on exceedingly volatile cryptocurrency, metaverse land is sensitive to fluctuating conditions.

    Metaverse Real Estate FAQs

    What exactly is Metaverse Land?

    Metaverse real estate is just digital land in virtual worlds. Investors in such areas control virtual land parcels where users can sell NFTs, play games, and interact.

    Can we buy property in the metaverse?

    Land purchase in the metaverse is only feasible with cryptocurrencies. Top metaverse projects that have attracted real estate include The Sandbox (SAND), Decentraland (MANA), and others.

    What impact will the metaverse have on real estate?

    The real estate agent would benefit as well because metaverse VR/AR technology widens the pool of possible purchasers dramatically. VR property shows are already taking place. There are VR possibilities where potential homeowners can take virtual reality tours using VR headsets and compatible smartphones.