NFT Real Estate: Your Next Income Source?

NFT real estate is real and increasing in value as we speak. Yes, it works almost exactly like the real world traditional real estate.

It bears so much potential. But before investing, you might want to learn a little more about it. That’s why our team is here to help you out.

What Is The NFT Real Estate Industry?

The name already encapsulates what it is. It’s a combination of NFT and real estate. In a sense,  you can call it virtual real estate.

You can quickly grasp the concept by understanding real-life real estate and how NFTs work. Let’s briefly dissect the two.

Real Estate Industry

You’re most likely familiar with how this works. In the real world, property owners or investors purchase land, property, and space.

When the market value is good, they either sell or rent out these properties to people looking for a house. Some also do it auction-style, and the house is sold to the highest bidder.

It’s a business and investment in real life, and the real estate market has always been booming. 

Non-Fungible Tokens (NFTs)

NFTs are all about digital ownership. The most common item sold is digital art, where artists sell the ownership of their work to someone else, who can resell it to someone else later on.

They utilize cryptocurrency and blockchain technology as the transaction is recorded in the smart contracts.

Famous examples are the Nyan Cat GIF, Jack Dorsey’s first tweet, and the NBA hotshots. 

Source: Tenor.com

Now, Merge the Two: NFT Real Estate Industry.

Transfer the concepts of real-world real estate to blockchain technology, and you’ll get the hyped-up NFT real estate.

You can choose a particular property, and downtown districts are also busier and more expensive. You can attend open houses and auctions, invest and engage in land sales, and purchase a property.

But they aren’t actual spaces you can physically be in.

They are all in the virtual world. It’s a digital estate if you want to call it that. You pay with cryptocurrencies instead of traditional money.

For some, you can even have mortgages for these virtual homes!

You can also create your digital world, sell virtual goods, and own digital property. In a sense, it’s almost like Animal Crossing.

Source: Nintendo.com

Only Tom Nook is a real person, and instead of bells, you pay with bitcoins or other cryptocurrencies.

A Short History Lesson on Real Estate NFT

The global pandemic did increase the value and sparked people’s curiosity.

But on the other hand, the beginnings of the concept started way back. But it didn’t have demand and wasn’t seen as a legitimate investment.

The most popular NFT real estate project, though, was sold last May 2020. It’s a digital real estate slash digital artwork by Krista Kim, entitled the Mars House.

Source: Worldarchitecture.org

The video is 3:27 minutes long, and it’s of a digital tour of the Mars House. You can see that it’s a virtual world with beautiful futuristic designs. Someone purchased it at the price of $512,000 (288 ETH).

Since then, the buzz around NFT real estate has increased. People are now saying that this is the future of the real estate industry.

Now, people are selling access to virtual real estate, selling virtual worlds for games on sale, and investors are seriously looking into real estate NFT as they foresee that this will be the future trend.

Pros and Cons of Virtual Real Estate

Like all things in life, there are pros and cons to this emerging concept. Well, it has already emerged – but not everyone grasps the idea. Luckily, you now have a head start!

Benefits Worth Mentioning

Here are some pros that we think will make investing worthwhile.

It’s Convenient

This is an undeniable advantage. Actual real estate properties will require you to physically go from one house to another or inspect your land of choice in person.

As we’ve witnessed, several factors could easily disrupt that – the pandemic being the best recent example.

You can converse with the owner, purchase properties, and put up real estate land online.

It Has the Potential to Be a Good Investment

Though the concept of NFT and virtual worlds is still questionable, it could be a reality in the future. Imagine how high the value will reach for your land, art, and space if so.

Giving it a shot won’t hurt and could become an advantage if you have the extra money to spare. Don’t bet your entire company funds or give up an actual land, of course. 

Precautions to Consider

For short, the cons. There are some excellent reasons why people are still hesitant to embrace NFT real estate.

The Risk is High

Since there are still a lot of uncertainties with advanced technology, we don’t know for sure if there will be a return with all these.

Sure, maybe you owned, or you now own, some excellent parcels of land or an iconic art piece, but who can say for sure that it’ll make you wealthy in the future?

The likes of Krista Kim are more exceptions than the rule. There are levels of fame and connections needed to achieve what they did.

Nothing’s Actually Real

We don’t know if you realize, but we’ll reiterate – it’s all virtual. You can’t stand on it; you can’t touch it; you can’t live in there.

At one glance, it all looks like a game. Like Sims!

Others will argue, why spend thousands and millions of dollars on something intangible when you can use that money to buy actual land? And that makes sense, right?

What Does NFT Real Estate Tell Us?

Real estate NFT is a branch of the whole cryptocurrency system. And these innovations tell us that technology is moving forward rapidly. It’s more advanced than ever, and it’s getting harder to grasp.

Though the majority of the people in this world still don’t fully comprehend how it works, many are already testing the waters and trying out their hands.

Some famous public figures are also reaping the most since people are willing to buy whatever to join in on the trend.

Even Facebook, the biggest social media platform with the broadest reach in the world, is testing out Metaverse, and who knows how what will turn out.

Verdict: So, Should I Start Investing in NFT Real Estate?

If you’re willing to take the risk, and if it’s well within your means, then we don’t see why not. Go for it! It’s an extra activity and an additional income source if done right.

As of now, it’s not yet taken seriously by everyone—only those who understand how the blockchain and crypto works appreciate the worth of virtual worlds.

So in a sense, you still have room to learn and grapple with the technicalities. Learning the ins and outs is also an investment for when this industry booms.

But let us be clear about one thing: don’t bet your life savings to invest in something you’re unsure about.

Sure, there are “success stories” about people who give up their life possessions, not caring what’s at stake, to trust a new system that will turn out to be the smartest thing ever.

You also see this in movies, probably.

But that’s not how investments work. It would be best to stay innovative and strategic about it.

Don’t go broke trying to go after a trend that isn’t within your means. You can try it out slowly and strategically, with one foot still on the surface.

Conclusion

We sure hope that you gained sufficient knowledge about NFT real estate. We tried to explain it in the simplest terms so that you won’t be bombarded with technical terms in one go.

As you do more research, we hope you get to enjoy the process and wisely strategize your way through NFT, real estate, or both!