Land prices in Metaverse have risen this year, with some plots selling for millions of dollars.
Many brands want to secure space that they believe will be popular on Metaverse. They also buy advertising space on popular platforms.
PricewaterhouseCoopers, Warner Music Group, and Adidas have all invested. But some say the location in the Metaverse doesn't matter because the headsets will allow us to teleport around.
Imagine living in a pre-Internet age. We all had to work in the offices, go to the shops to buy things, when the TV could not run on demand and when most of the money transactions with notes and coins.
Imagine someone coming up and telling you how something that didn't even exist would look like ancient history. You may have found this idea ridiculous, just the way you might feel about Metaverse and that there is a boom in real estate right now.
Land Cost in Metaverse
Prices have risen by up to 500% since Facebook renamed its holding company in October 2021. People are ready to invest millions of dollars to buy plots of pixelated land in this virtual world, even though they are not fully present yet.
So Why Are People So Anxious To Buy Land In The Metaverse?
Metaverse is a 3D version of the Internet, and the expectation is that once technology captures this concept, more people will spend more time in this digital world. People spend a lot of time using the Internet, so why don't they spend more time on Metaverse.
All of this means that you can make some earnest money. Metaverse has the potential to become a multi-trillion dollar part of the global economy in the coming decades.
The next three years will be necessary for all Metaverse-aspiring companies like Microsoft and Facebook. It's a race to reach one billion subscribers. Whoever brings the first one billion subscribers will be the leader in setting standards.
How Does Real Estate Work In the Metaverse?
There is a Metaverse, but there are many platforms within it. Think of these platforms as the nations of the earth - the different terrestrial peoples on the same planet. The size of these platforms is limited, meaning that once someone buys a plot of land, people can't use the space unless they are willing to rent or buy it. If more people are interested in this land, the price will go up.
Metaverse currently has four primary platforms to buy and sell NFTs. They are Sandbox, Decentraland, Cryptovoxels, XANALIA Marketplace, and Somnium Space.
So Who Already Owns The Land In Metaverse?
Companies are buying land in the Metaverse in the hope that it will help them reach new customers. PricewaterhouseCoopers has a plot in Metaverse, which aims to "establish a Web 3.0 advisory hub.
It will facilitate a new generation of professional services, including accounting and taxation." Adidas has also purchased land there "to express its excitement about its potential," and Warner Music Group is working to establish a virtual concert venue.
Meanwhile, other people buy plots to get close to the big names to get compliments - just like you might in the real world. Someone has paid $450,000 to become a neighbor of rapper Snoop Dogg's and is opening an embassy in Metaverse.
Will Metaverse Boom Lead To Bust?
However, some people are more skeptical about rising real estate prices in Metaverse.
They say that there will be no difference in location because your headset will mean that you can teleport anywhere you want in seconds.
However, if people teleport to the same virtual concert venues or shopping malls, these areas will likely offer better prices for commercial real estate and advertisers.
"While interest in digital real estate has grown over the last months, it is clear that many people do not yet fully understand the real use of these plots," says Artur Sychov, founder and CEO of Somnium Space."
The actual financial value should only be linked to virtual goods that provide tangible benefits to their owners; otherwise, there is a considerable risk of creating a speculative bubble that will hurt consumers and companies.
Others say that all this virtual land may eventually be useless, as platforms say they are limited in size; the actual Metaverse themselves have no reason to do so, as more media are involved.
Like the .com bubble of the late 1990s, a sudden rush to a new area is likely to push up prices.
Commercial real estate broker and developer, whose firm provides advisory advice for the Metaverse platform Super World said: "Right now in the virtual real estate space, you see many people on FOMO.
Conclusion
Many questions remain about the future of Metaverse, but one thing that is certain now is that we are going to hear a lot about it in the coming months.
