Thank Facebook for metaverse bonanza, real estate may sell for $1 billion in 2022
Last year, real estate in the metaverse sold for over $500 million, with the majority of the action taking place on the “Big Four” platforms. Sales have potential to double this year.
Real estate on metaverse platforms reached $501 million last year. That figure could double in 2022, according to analysts speaking to CNBC.
Facebook played a big role in the surge last year, starting when the company announced its rebranding to Meta and its focus on the metaverse on the 28th of October. With Facebook’s announcement, sales started to surge in November, reaching $133 million – a ninefold increase.
Sales at this level have continued into this year, hitting $85 million in January – ten times more than in January 2021. If the market will keep this tempo throughout the year, analysts at MetaMetric Solutions predict the total sales in 2022 could reach $1 billion.
Most action on the “Big Four”
The vast majority of the pieces of land-changing hands are located in the so-called Big Four metaverses – Sandbox, Decentraland, Cryptovoxels, and Somnium. These four hold 268,645 parcels of land of various sizes, but there are over a dozen platforms on the market.
“There are big risks, but potentially big rewards,” said Janine Yorio, CEO of Republic Realm, a metaverse real estate investor and advisory firm.
Focusing on the Sandbox, the biggest metaverse real estate platform, Republic Realm paid a record $4.3 million for 100 “Fantasy Islands” with their own villas and a related market of boats and jet skis. Ninety of the islands sold on the first day for $15,000 each and some are now listed for resale for more than $100,000.
According to a report from Republic Realm, Sandbox dominates the metaverse real estate market, with 62% of the available land on the four platforms and three-quarters of all land sales in 2022. Sandbox has virtual room for 166,464 parcels which sold for $12,700 in December. The parcels are 96 meters by 96 meters.
The second player on the market, Decentraland, has 90,600 16 by 16 meter parcels, which sold for $14,440 per parcel in December.
Is location important?
According to some analysts speaking to CNBC, location is not so important, while others claim location is everything.
“You can teleport anywhere so location isn’t as important,” said Republic Realm’s CEO Janine Yorio.
Evidence pointing in the other direction are the fact that parcels near-legendary rapper Snoop Dogg’s planned partnership and virtual world in Sandbox are fetching a premium, along with parcels near the Atari development on the same platform.