Should Real Estate Investors Care About the Metaverse?

The metaverse seems to be everywhere nowadays, with news of innovative and intriguing planned expansions to virtual 3D worlds appearing regularly.

Table of Contents 

1. What Is the Metaverse?
2. How Does the Metaverse Work?
3. What Is the Metaverse Like Today?
4. Does the Metaverse Have Anything Interesting for Real Estate Investors?
5. Warning: The Metaverse Is Not Suitable for Every Investor
6. Conclusion

It’s an exciting time to be an investor. According to the buzz, investing in metaverse locations seems to become the next big thing for every investor with spare money.

Even though it is simple to own metaverse real estate, it is not for everyone. Not only is it a high-risk investment, but there are still many unknown factors. Nonetheless, there are other reasons to become an investor in the field, including those discussed in this article.

What Is the Metaverse?

After social media giant Facebook announced its intention to join the metaverse, word spread like wildfire. It is something that almost everyone on the web already heard of, but due to its “originality,” few individuals understand how it works.

The metaverse meaning is best described as an alternative digital reality in which people go to work, engage in recreational activities, and create digital identities. It’s simply the next generation of the internet, combining virtual and augmented reality components to imitate real-life events—sometimes referred to as Web 3.0.

Purchasing and selling virtual real estate is one of the business chances. Such virtual territories will serve as meeting points for our digital identities—avatars. As more people enter the world of 3D networks, there will be a greater need to use digital real estate.

How Does the Metaverse Work?

The metaverse is a fusion of virtual, augmented, and actual reality, blurring the lines between your online and real-life activities. But, in a nutshell, it’s a set of platforms like the Mirandus, Sandbox, and Decentraland through which people can connect in various ways.

After founder Mark Zuckerberg declared that Facebook would change its name to Meta and end up spending more than $10 billion on the metaverse, curiosity about it skyrocketed. As more people continue to speculate on a future embedded in the virtual world, companies are already starting to launch new ventures in the said digital arena.

The metaverse Facebook concept comes down to virtual avatars of individuals playing games, holding meetings, taking courses, exercising, studying, and socializing are included and all kinds of activities that may be done in real life.

Basically, the Facebook metaverse comes down to a few steps when you enter that digital reality:

• Create an avatar
• Start exploring
• Move around virtual places
• Play games
• Make friends
• Join some club
• Do various activities

The concept can be expanded into a much broader and more significant digital reality. However, it is worth noting that Zuckerberg estimates the metaverse will take roughly ten years to gain widespread adoption. To think about it, that’s a small period of time.

Is Anybody on It?

Microsoft is yet another major Big Tech organization attempting to construct such a world. Mesh is the name given to Microsoft’s concept. One of the most intriguing characteristics is what the firm refers to as “Holoportation.” Simply stated, its users will be able to cast holographic versions of themselves onto other users.

Its augmented and virtual worlds are best enjoyed with HoloLens devices—a one-of-a-kind device that can completely transform the “Holoportation” sensation. On the other hand, Mesh can be accessed via VR headsets, smartphones, tablets, or computers.

The displays will initially take the shape of animated figures. It will gradually become a photorealistic lifelike hologram. Similar to how the protagonists in Star Wars engage with one another using holographic projection.

Walmart Metaverse May Become a Thing

The introduction of VR headsets and apps such as the Oculus app has significantly boosted the virtual world concept. Games designed for virtual reality headsets are already making lots of money.

Moreover, Walmart looks to be preparing for a journey into the 3D world. According to a CNBC report, recent trademark registrations show the corporation is trying to build its own NFTs and cryptocurrency. On December 30, 2021, the retail behemoth filed for various trademarks, indicating ambitions to begin selling virtual products, including electronics, toys, recreational equipment, home decor, and more.

Walmart is constantly researching how emerging technology may influence future retail experience, e.g., Walmart vision glasses online shop.

Related: A Buyer’s Guide to Real Estate Virtual Tours

What Is the Metaverse Like Today?

What is known is that it will mark a new era in which our digital and online existence will merge. It remains to be seen how it will play out.

Defining the Metaverse’s Concepts

Businessman and game designer Jon Radoff recently presented one of the best ideas for the design features and levels. Experience, Discovery, Creator Economy, Spatial Computing, Decentralization, Human Interface, and Infrastructure are the seven platforms he outlined, and they form an end-to-end value chain for the 3D world.

Experience dematerializes our physical location, releasing a graphical landscape and social engagement in which content is generated not just by individuals but also dynamically through connections and streams. The process that allows people to uncover sources of information about new experiences is known as discovery. NFTs ((non-fungible tokens) are simple examples of metaverse crypto.

The majority of the elements of the said layered architecture are already in place—however, in varying stages of development, which means that portions of the Facebook metaverse may be realized faster than predicted.

Content Creators Fuel the Experience

The virtual reality will be powered by a slew of content creators who will use digital assets and data to build virtual environments, such as music halls, casinos, amusement parks, and sports facilities.

With shorter version content, the growth of video-based material, and widespread mobile access, social media transformed the content creation dynamic by magnifying existing content and enabling more individuals to become creators.

Nevertheless, such creators will control their viewers in such reality, allowing them to monetize their content via NFTs. The information will no longer be two-dimensional but instead be realistic and engaging. The platform will not only cater to a wide range of audiences but also contain very narrow and distinct worlds that will provide individualized experiences.

NFTS Take on the Role of Delivery Mechanism

Metaverse crypto or NFTs are a new type of digital currency that is one-of-a-kind, cannot be duplicated, and is linked with certain ownership rights. An NFT is a proof of ownership that is kept on the blockchain for a digital asset such as a film, photo, audio file, visual photography, or any other sort of collectible.

An NFT can also be a show or athletic event ticket with inbuilt, tailored access, such as a particular time to meet and greet a performer.

NFTs are still in the early stages of stability and face specific vital challenges. Still, they will soon move past collectibles and begin to symbolize a broader range of financial instruments, including insurance, stock grants, loans, and real estate.

Does the Metaverse Have Anything Interesting for Real Estate Investors?

Any real estate investor will tell you that return on investment (ROI) is at the core of their motivations. They anticipate a return on their investment, whether investing in a venture to create jobs in a deprived area or building a 30-story-tall skyscraper in New York City for commercial usage.

But how can this virtual reality help investors even more? And what are the drawbacks of this new reality? There are numerous reasons to become an investor in this field, including those listed below.

You Want to Advertise the Company

If you have a brand or company that resonates with Generation Z (those aged 10 to 25), virtual reality can be an excellent spot to engage with them. Many Gen Z members are already employed, and they are familiar with digital environments that resemble popular network platforms, such as Decentraland and The Sandbox. The total purchasing power of Generation Z is already projected to be around $150 billion.

 Since Gen Z’ers are less interested in previous social media sites, they tend to engage in metaverse-like channels. It is the web Gen Z is familiar with, and a savvy advertiser goes where their clients are. After all, Generation Z is the internet’s future, and what they anticipate will ultimately become a reality.

You Want to Support Other Businesses

If you have a clear understanding of how this network will function and what ventures will fit there, investing in metaverse real estate as a developer or landlord may be a good idea.

Many companies are looking for a path into the virtual world but are unsure where to start. Experts can assist them in taking a project from idea to implementation, frequently with numerous partners sharing expertise. In addition to advising on where and when buildings should be constructed, they often purchase property to develop before reselling it.

On the other hand, landlords on the platform know precisely what they want to construct and to whom they wish to lease their properties. They look for brands and businesses that want to establish a footprint in the network but aren’t sure if they can commit entirely to owning virtual land. If landlords create attractive structures in good spots, they will be able to produce long-term rental income.

Related: 5 Things You Didn’t Know About Becoming a Landlord

You Want to Create Something

One category of virtual real estate investor that we hardly mention is the one who is both intrigued about this future world and is technologically savvy. They’re probably already exploring cryptocurrencies and fiddling around in virtual reality areas, but they haven’t yet established foundations. Purchasing a piece of digital land may be more of an act of self-expression than investing for people of this sort.

Nonetheless, merely by owning a virtual property – even if it is only an open area or an art exhibit for the time being – they become investors as well. According to a Citi GPS analysis, the 3D network might attract five billion active users and a potential addressable market of up to $13 trillion.

As a result of such growth, many pieces of digital land are sure to increase in value, even if they’ve merely been utilized for their owners’ benefit. People will keep making the platform you chose their virtual home as long as it maintains a vibrant community and is motivated by a sense of cooperation.

 

Warning: The Metaverse Is Not Suitable for Every Investor

While investing in such real estate may appear to be a risky venture, there is growing evidence that this parallel reality is here to stay. With a limited quantity of construction lots and theoretically infinite users, the desirability of real estate on any virtual network will dictate its value. The same holds for actual land in any neighborhood in any town or city.

There’s no way of knowing which 3D portals will take off and which ones will fade away this early in the evolution of what is predicted to become the metaverse. But if you’re the bold type or have a business strategy in mind that would profit from a virtual involvement, you should certainly give it a shot.

Patience is essential since establishing the platforms will take some time (and commitment). But there’s only so much disadvantage to being an early supporter of technology with the potential to become an entirely new way of linking people worldwide.

However, since some investors find it unsafe (for now), you should only invest money you are willing to lose. That’s why we will be focusing on Mashvisor and how it can help you find investment properties in the real world.

To learn more about how we will help you make faster and smarter real estate investment decisions, click here.

The Advantages of Using Mashvisor

Mashvisor allows you to determine how profitable a particular deal is before you commit to purchasing investment properties. That being said, there are various methods for using Mashvisor tools.

Data Analysis

Mashvisor is more than just a real estate platform with property listings. Its primary usage is as a data analytics tool. Mashvisor collects all of the data from MLS listings and other real estate sites like Airbnb.

You can use the filters to pinpoint your listings as much as you like depending on what you’re searching for.

Property Search

Not only will you be able to manage and browse available properties in specified regions, but Mashvisor’s Real Estate Heatmap will make the entire search process more thorough and effective.

The heatmap tool categorizes neighborhoods in various cities across the country. When you filter your search using your parameters, the tool will highlight the places with the greatest available deals. For example, green will be assigned to homes with the highest rental value or the most cost-effective investment.

You get all of the data from the MLS database, but you also get access to improved real estate analysis of what all of that info represents. It is helpful for investors who want to ensure that they acquire the most profitable deals.

Real Estate Comps

The complete comparison study of distinct properties is a unique function of Mashvisor. For example, once you’ve determined the best place to buy rental property, you may select all houses that fit your standards and then use the comparison tool to see which one would provide you with the best return on investment.

Mashvisor utilizes numerous metrics to deliver the most precise evaluation of real estate comps. Potential rental revenue by strategy, sale price, number of rooms and facilities, property location, sale period, and walk score are all factors to consider.

Related: What Are Real Estate Comps and How to Easily Find Them 

Property Calculator

Mashvisor’s functionality does not end there. If you’re searching for a rental investment property, the Mashvisor Rental Property Calculator tool will recommend rental prices for each property.

To estimate the optimum rental price for the home you’re interested in, the algorithm considers the rental prices of similar houses. Other significant measures, such as taxes and mortgage, HOA charges, repair and maintenance costs, and so on, can also be calculated.

Conclusion

It’s crucial to remember that the metaverse is still an unexplored zone as fascinating as it is. Digital real estate investing is a relatively new and fast-changing form of investment. Dangers abound, like with any “real world” investment. It’s like deciding to invest in real estate in a fully undeveloped market. It can be ahead of the game, or it can entirely fail.

What is certain is that, as with any investment opportunity, people who want to get engaged in 3D world real estate should do their research first and understand the potential drawbacks.

One thing is sure—if you are ready to start your investment journey in the real world—Mashvisor is here to help you navigate through the process.

To get access to our real estate investment tools, click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.