In a world that would have prompted head-scratching among realtors just a few years ago, the metaverse real estate market is booming, with reports indicating that sales may near the $1 billion mark by the end of this year, up from $500 million in 2021.
In existence for more than two decades, the metaverse itself is a system of three-dimensional virtual worlds that has largely been used for the development of online video games.
But in the last several years the notion of selling real estate in the metaverse has taken off among investors and those who just enjoy adventurous betting, with a kind of fever particularly heating up in recent months: according to the site MetaMetri Solutions, sales in this strange new world surpassed the $85 million mark in just January alone.
The publication Coin Desk this week found a New York digital strategist who said that while his actual home had recently more than doubled in value, the plot of land he owns in the metaverse has increased by 1,400 times.
Notes analyst Aviva Sonenreich in a column for Forbes: “The metaverse is a global phenomenon presenting real estate in a way humans have never experienced.”
Sonenreich adds: “This is real estate that is not physical, but rather, virtual.”
That means the real estate being bought and sold doesn’t exist in terms of being land or houses or buildings. It is instead imaginary real estate that is a real thing only via a digital platform.
There are, to date, four major platforms in the metaverse containing more than 268,000 parcels of land. Users plugging into those platforms bid on certain pieces of real estate, with ever-increasing bids adding to the property’s value. The bidding very much includes real estate firms and brokers trying to get a foothold in a new and alien world.
Metaverse skeptics, such as Edward Castronova, a media professor at Indiana University, have likened real estate trading in this new universe to a “pyramid scheme.” In an interview with the New York Post, the professor added that those purchasing property in the metaverse guarantees that “you and only you are the owner of this particular piece of nothing.”
Wired magazine has also expressed doubts, noting that the hype surrounding metaverse investing “has helped conceal a reality that more closely resembles early-access video games and common pump-and-dump schemes.”
But the website Motley Fool is more bullish: “Despite the severe dip in the stock market taking place right now, interest in metaverse real estate is strong.”
The site additionally says that the potential for realizing metaverse profits is a real, if highly uncertain, thing. “Metaverse real estate has many of the same characteristics of real-world real estate,” continues the Motley Fool. “It’s only a scam if you consider capitalism to be a scam.”
By Garry Boulard
