Like the rest of the investing world, things have really slowed down when it comes to virtual land in the metaverse. This once-buzzy collection of 3D worlds has largely fallen out of the headlines, but it's hardly lost its appeal as a source of passive income.

Metaverse real estate prices now are sitting at or near a one-year low, depending on which platform you're looking at, creating amazing opportunities for entrepreneurial-minded investors to pick up some great deals. Although there's not a lot of money in buying and reselling land right now, there's ample opportunity as a metaverse landlord and developer.

The metaverse hasn't slowed down for everyone

Purchase prices in the metaverse have been depressed for months, even with a very limited inventory of available land. For example, in September, only 0.77% of the more than 97,000 properties in Decentraland (MANA -1.21%) were listed and sold, despite there being 1.48 buyers for land seller.

This has made it incredibly difficult for speculators to flip properties, but it's been a boon to people who have a longer-term vision for what the metaverse can be. Those folks are finding ways to lease their properties to brands that are interested in having a metaverse presence without committing to a purchase right away.

New brands continue to come online, with recent debuts from United Parcel Service, Pepperidge Farm, and Schneider Electric in Decentraland and names like HSBC, DBS Bank, and Atari announcing new projects in The Sandbox (SAND -1.53%).

Although metaverse landlords are largely tight-lipped about their clients, Sam Huber of LandVault (formerly Admix), shared some very surprising information with Fast Company about just how much a metaverse landlord-developer can earn with their land. For Huber, monthly rents are running upward of $60,000, with as much as a 70% profit margin for projects he develops and then rents back to the brand.

The price of metaverse real estate today

Although the price of any piece of real estate, real or virtual, is prone to fluctuations, metaverse real estate is really down in value right now, largely due to the huge drag from cryptocurrency markets. Because virtual land is acquired using cryptocurrency, when the prices of crypto drop, the values of virtual real estate can also be affected.

The average of the lowest daily listed land prices over time, known as the average floor price, in The Sandbox in September was just $1,688.28, and $2,444.05 in Decentraland. This is a huge drop from even June, when the average floor price in The Sandbox was $2,334.36 and $3,064.07 in Decentraland, 27.68% and 20.24% decreases, respectively.

 

The Sandbox

Decentraland

Avg. floor price June 2022

$2,334.36

$3,064.07

Avg. floor price September 2022

$1,688.28

$2,444.05

Change %

(27.68%)

(20.24%)

Change $

($646.09)

($620.03)

Data source: CoinGecko, as of Oct. 10, 2022.

In short, you, too, can score rentable metaverse real estate for less than $2,500, depending on which platform you want to use. Prices, of course, will vary based on the proximity to popular spots and other potential traffic sources, but it's certainly not unheard of right now for land to bring so little. This is a huge comedown from December 2021, when an average sale on either platform was about $14,000.

Passive metaverse income is still a popular use case for virtual land

Metaverse real estate may seem like a volatile investment, but it's been a very regular source of income for many during the past year, as brands increasingly find their way to the metaverse and discover that they need a lot of help creating environments that will appeal to potential customers and users. The most successful landlords, like Huber, also work as consultants or developers for their tenant companies, but other brands have very clear visions of what they want on their property and only need the right place to unload their imagination.

Buying real estate in the metaverse during the crypto winter gives you a huge advantage over those who bought before the freeze, or who may buy later, when the thaw begins. For those who buy now, a lower cost basis for your metaverse rental property means that more passive income will flow to profit, and that's never a bad thing.