It looks like everything is going virtual nowadays. Virtual events, virtual art, virtual business meetings, virtual marketing, and whatnot. But how about virtual real estate? Is this a real thing, and if so, can we make an investment?

Let us talk about Metaverse real estate, an online community where users can interact to play games, publish products, provide services, and host events. Businesses frequently hold ownership of these digital assets. And like all other kinds of real estate, it is possible to purchase, sell, lease, and buy it.

Over the past few years, there have been some significant technological developments in the real estate sector. Because of the significant growth in virtual land transactions, innovations in technology are radically changing the real estate sector.

From 2020 to 2025, the demand for Metaverse Real Estate is predicted to grow at a CAGR of 45.2%, with revenues rising from USD 358.0 million in the year 2020 to USD 3600 million in 2025. Thus, it is clear that the Metaverse Real Estate market has been thriving recently. But what exactly is Metaverse Real estate, and how you can create it? Let’s find out.

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What is Metaverse Real Estate?

Plots of land or buildings used for residential or commercial purposes that are present in a virtual environment are referred to as real estate in the metaverse. You can construct any type of property on the land, including corporate headquarters for legitimate businesses as well as billboards for advertising.

In reality, the “real estate” in the Metaverse is nothing more than computer screen pixels. However, a lot of platforms have been designed as programmable settings where users may engage in social interaction, exchange NFTs (non-fungible tokens), play games, advertise their products and services, and even attend meetings while wearing 3D avatars.

On a number of metaverse platforms offering unique virtual settings, investors can purchase land parcels. A single platform is unable to completely reflect the metaverse because each one offers a variety of services. The Decentraland, Sandbox, Horizon Worlds, Metahero, and Celebrity Atlas are some of the most well-liked metaverse platforms that real estate developers invest in.

Now that we have an understanding of what Metaverse real estate is. Let’s move ahead to find out how to create real estate in Metaverse

How to Create Real Estate in Metaverse

It takes proper planning to create a metaverse real estate platform. Despite the fact that it could seem intimidating, the project can be successfully completed with the appropriate strategy, the assistance of a reputable metaverse development company, and the right attitude. Anyone wishing to enter the virtual real estate industry has an exciting opportunity to build and sell virtual properties. Therefore, be sure to complete the following steps before making any purchases on a Metaverse real estate marketplace.

1. Select a Platform

You need a broad range of abilities in order to create a real estate in the metaverse. You can build a virtual property across a number of Metaverse platforms. Before making a choice, it is imperative to weigh all of your options.

  • All primary blockchain systems, such as Ethereum, Solana, Algorand, and Polygon, offer the framework for creating a community-driven and decentralized simulated environment.
  • The capability of a smart contract, which defines particular actions to take in response to certain events, serves as the framework for a blockchain-based metaverse.
  • For optimum performance, it is necessary to have decentralized money, cryptocurrencies, and NFTs. By choosing these platforms, you can create real estate Metaverse properties inside of already-existing blockchain Metaverse platforms such as Decentraland, Sandbox, Crypto Voxels, etc.

Metaverse platforms currently in existence are still developing. So it is best to start the process of developing real estate in Metaverse from the beginning. It is the best method because you can include the features and abilities you want. By doing this, you can build a bigger, more specialized Metaverse platform. In addition, you can track the development of the Metaverse ecosystem while simultaneously adding new real estate Metaverse properties.

Also know: How To Buy Property In The Metaverse

2. Establish a Metaverse Smart Contract.

It is necessary to create smart contracts that utilize blockchains to create Metaverse real estate or buy property in Metaverse. A metaverse smart contract is a set of unchangeable “rules” that, when a number of requirements are met, force predetermined actions to be carried out. The sale or purchase is carried out by the smart contract once both the seller and the prospective buyer click “Agree.”

Two parties can define and execute lease agreements using smart contracts. This clause also allows for the termination of the agreement if the tenant violates the rules. Using smart contracts will enable the full realization of the benefits of a real estate Metaverse ecosystem. An NFT smart contract can be used to tokenize and create non-fungible entities out of real estate assets like Metaverse buildings or property.

3. Implementing the IPFS Storage System

To store enormous amounts of data, decentralized IPFS storage systems are set up and processed. The data is cryptographically hashed and stored in a system configured in accordance with the requirements of the operating system.

4. Establish an Information Database.

The next step is to construct a database wherein people can save important data related to the virtual environment. These data, which are maintained under various security safeguards, comprise user details and the associated data, records of transactions, and other data.

5. Incorporate VR and AI Features

This is where much of the focus is placed when developing a Metaverse property or virtual real estate market. In order to make it possible to create digital avatars, virtual environments, and other things, the metaverse platform integrates AI with VR capabilities. It makes it easier for users to interact with the system. These elements will provide a digital representation of an actual physical process.

6. Design Your Own Metaspace

Metaspace could be anything, such as an application, a virtual conference room, or even a virtual movie theater. This virtual environment is accessible to everyone using a VR headset. The design and development of the Metaverse property may start once the platform is finished. Making the overall structure of a metaspace is a step in the creation process.

A metaspace can be as big as an entire city or as small as a single room. Working with a metaverse development company will make it very simple to create virtual reality applications and 3D designs that adhere to the goals of a blockchain-enabled platform.

7. Creating an Interaction Layer

At this step, you will create the application logic needed for assets and characters to communicate with virtual space. This layer establishes rules for user controls, communication methods, and accessibility. A simple instance is when a visitor uses an identification card to enter a structure, such as a convention center.

Determining how the system will interact with third-party apps is crucial at this stage. Technologies that can be employed for video conferencing include Zoom, VR goggles, smart glasses, haptic gloves, headsets, sensors, and more. Building a link between the physical world and the metaverse takes place in the interaction layer.

Also know: How To Make Money In The Metaverse

8. Create an Interoperability Layer

Interoperability expands the scope of the metaverse and makes it more inclusive. For instance, a person from one metaverse might want to travel to another location and purchase tickets for an event there. Users can achieve the same results by assuring interoperability across different blockchain technologies.

Facilitating cross-environment transactions is crucial to building a fully functional Metaverse real estate. Choose a blockchain that can handle payments via a gateway quickly and securely.

The steps outlined here will help you build a virtual asset or Metaverse building that stands out in the crowded Metaverse market.

Investment Opportunities in Virtual Real Estate

With the removal of the geographic constraint that formerly restricted the sale of real estate, individuals are able to buy a piece of Metaverse property and earn consistent rental income from it in the Metaverse. The metaverse has fundamentally altered property and real estate by tokenizing it with NFTs. Some of the fundamental options available to investors in Metaverse real estate include the following:

1. Gaming platforms

To take advantage of gamers’ growing interest in Metaverse real estate, both offline and online investors are pouring millions of dollars into video games. This sector has grown as a result of electronic gaming and cryptocurrency investor interest. Many people think that games with NFT support will boost the billion-dollar gaming industry.

Gamers have spent years on in-game items like guns, armor, or equipment in games like World of Warcraft, Fortnite, and Minecraft to enhance their characters. The NFT-enabled games now let users sell their in-game items for game coins that can be exchanged for cash or traded in for cryptocurrency.

In several video games, players can purchase NFT to buy property in Metaverse that they can then rent out. The players have the option of charging for access to their virtual land or selling it on an internal or external market like OpenSea. Players can use the in-game currency for transactions and exchange it for Ethereum and dollars.

2. Virtual Event

The “metaverse” has hosted a number of virtual events in recent years. Numerous well-known musicians are heavily utilizing this technology, and some are even giving live performances. For example,

  • Justin Bieber performed at the live Metaverse concert in November 2021.
  • On March 27, 2022, Daler Mehndi bought the Metaverse property Balle Balle Land in the PartyNite, an Indian metaverse.
  • In March 2022 as a part of the Pixel Party, the Singaporean indie band Bandwagon gave its first virtual reality performance.
  • On June 28, 2022, Guns N’ Roses Guitarist Slash performs at a Metaverse VR concert

The demand for real estate in the metaverse grows over time for a number of reasons. This is another reason why locations for celebrations, concerts, and other events are constantly changing in the metaverse. One of the most popular features in the sector today is virtual real estate. It becomes increasingly popular among consumers as well as market players.

3. Digital Property

Corporations are spending billions of dollars on fictitious land, despite the fact that the majority of people cannot afford it.

  • CNBC reported that the cost of a digital plot has increased by 500% since Facebook made its first meta move.
  • According to reports, one business spent over $2.5 million to purchase real estate in Descentraland, a cryptocurrency-based metaverse where all in-game content is owned exclusively by its users.
  • For nearly $4.3 million, another business purchased land in Atari’s The Sandbox Metaverse.
  • According to Sebastian Borget, COO of Sandbox and co-founder, who spoke with Al Arabiya English, approximately 16,000 people have bought virtual land in the blockchain-connected video game.
  • Celebrity events and appearances are becoming more common, much like Fortnite concerts. Celebrities such as Will Smith, Paris Hilton, and Snoop Dogg possess virtual assets, which undoubtedly raises the cost of Metaverse property.
  • To give customers a fully immersive experience, businesses are making investments in metaspace virtual stores.

Entering the digital sphere is currently the new norm. It also generates the biggest profit on the market.

Also know: Metaverse Business Ideas & Opportunities

Final Takeaway

Over the past few years, there have been major technological advancements in the Metaverse real estate sector. The real estate business is going through a major upheaval as a result of technological advancements like the metaverse and the rapid increase in online real estate purchases.

However, there are significant risks and substantial profits involved in investing in metaverse real estate. The virtual world’s uncertainties have the potential to exponentially increase into large gains or degenerate into a total loss of assets. Therefore, the developer must make sure they fully grasp how the metaverse operates before making an investment or buying property in Metaverse.

Before investing, buyers must decide how much risk they are willing to take, consider all of their investment possibilities, and consult with specialists. With all of these things taken into account, it is clear that the metaverse will shape how people live in the future. We should therefore get ready for this immersive, empowering, and engaging next-generation technology.