When you're on the hunt for real estate in the real world (with all its inconveniences like a breathable atmosphere and physical form), there are a few routes to purchase, like using a Realtor or contacting a land owner directly to ask if they'd be willing to sell. Although the metaverse doesn't yet have Realtors to sell virtual real estate, the process isn't that much different.
In the metaverse, you have options when you're buying real estate based on how you like to do business. Let's talk about what a real estate transaction in the metaverse looks like.
Image source: Getty Images.
First, you'll need a digital wallet
You can't buy real-world real estate without money, and the same goes for virtual real estate. You can't just stick your credit card in a slot; you'll need a digital wallet in order to purchase the crypto currency for the platform you're interested in.
For example, Decentraland's currency, commonly known as MANA, can be used to buy virtual real estate there but not on other platforms like The Sandbox. There are some platforms that will allow you to use Ethereum, either directly or in order to exchange for the platform's currency.
Your digital wallet will be hosted outside of your metaverse and must be connected to your metaverse account before you can get started on building your virtual real estate empire. Some platforms may specify the wallet you have to use; others may be more flexible. Whatever you do, write down the seed phrase you've been assigned when your wallet is opened, because these are difficult (if not impossible) to recover, and losing your wallet means losing your assets forever.
Next, choose your buying platform
You have a couple of options when it comes to buying land in the metaverse. You can choose to buy your property directly on a specific metaverse platform, or you can go through one of many popular third-party platforms that offer buying and selling opportunities.
Purchasing inside the metaverse is nice because you can get a good feel for what it is you're buying, including seeing who the neighbors are and what sorts of amenities may be nearby. However, if you've not committed to a metaverse yet and are trying to shop around for a deal in your price range, it can be pretty tedious to continue platform hopping until you land on one that's suitable.
In that case, one of the third-party platforms, like OpenSea or NonFungible.com, are great options. You can see virtual land parcels across several platforms (offerings may vary between third-party providers), as well as the asking price in your local real-world currency equivalent. This can be an easier way to understand how much you're actually spending if you're new to the metaverse, especially since every cryptocoin has its own value, independent of others.
Making an offer and closing
If you've bought physical real estate before, you know this next bit can be a real nightmare in the real world. In the virtual world, it's kind of almost not a thing. When you find a parcel you like and that's within your budget, you simply click on it and buy it. On some platforms, like Decentraland, you can also make an offer on the property within the platform and the owner either accepts or rejects your offer.
Either way, once you have your parcel selected, your wallet funded, and you've settled on a price, clicking the buy button literally wraps up the rest. Blockchain funding takes just a minute, and the transaction is recorded using an anonymous identifier for your wallet, indicating that you now hold the NFT title to the property. Your ownership is complete. It's all yours, as long as you don't lose your digital wallet where you'll store your NFTs.
What about appraisals in the metaverse?
Right now, there are no tried-and-true formulas for appraising virtual real estate, though some large commercial ventures are trying to figure it out. The thing that's important to keep in mind with metaverse real estate is that it's extremely new, extremely experimental, and extremely volatile. Just a few months ago, you could buy lots in almost any metaverse for a few hundred dollars, but today, you'll need a few thousand, minimum, just to get in the door.
Because there's not a long history of transactions for most metaverses, investing in them is highly speculative. That's not to say you can't win with virtual real estate; it's just that it's a very new type of asset, and we haven't yet figured out what the price tolerance is or how much interest there will be in any specific metaverse.
There is always a risk that a metaverse property will go to zero because the platform is abandoned, so it's vital that you keep this in mind when shopping for virtual real estate. Unlike physical real estate, where you still have a piece of land left if everything else goes bad, if a metaverse platform folds and goes offline, you don't even have the land.
