What Real Estate In The Metaverse Actually Means

Real estate in the metaverse is hot. Although it exists as pixels on your screen, it represents places where you can socialize, play games, and more in a virtual environment. Since Facebook changed its name to Meta in late 2021, companies have been rushing to profit from the VR real estate boom that followed. CNBC reported in February 2022 that sales involving metaverse real estate increased almost ninefold to $133 million as of November 2021, and sales across the four biggest metaverse platforms hit $501 million last year. Some of the plots are just as costly as buying an actual house, with prices ranging up to the millions for prime digital real estate.

There are a few factors that determine how much a piece of the digital frontier is worth. Janine Yorio, CEO of Republic Realm, a metaverse real estate investment firm, told CNBC that location may not be a reason to spike land prices. Rather, the designated value may be determined by attractions or special features such as a museum or coffee shop.

However, this is arguable as it is seen that users are interested in plonking down their plot in places where they think they will get the most value from it. Time reported that an anonymous buyer bought a piece of property next to (virtual) land belonging to the rapper Snoop Dogg for a reported $450,000, thinking that a celebrity neighbor would boost the property value. But, is it worth the hype? For experts like Janine Yorio, she told CNBC, “There are big risks, but potentially big rewards.”