The real estate market in the metaverse is projected to pass $5 billion by 2026. This is the prediction of the latest metaverse report by Technavio, a global market research firm. The report states that the rise will be fueled by the growth of the metaverse into a mixed reality environment, where people can take advantage of these spaces.
Metaverse Real Estate Market to Grow Exponentially
As the metaverse becomes a more living, tangible breathing world, more and more people will be interested in becoming part of its social ecosystem. The real estate market in the metaverse is affected by this popularity. A recent study produced by Technavio, a global market research firm, predicts exponential growth in the value of this market.
The report, which also studies other factors related to this new market, estimates that the value of virtual real estate will grow by $5.36 billion by 2026. This expansion will be fueled by two factors. First, the metaverse will gradually move towards a more mixed reality experience, giving more value to these platforms in which visitors can inhabit, taking annotations and decoding tags for different application-specific purposes.
The second reason has to do with the popularity of cryptocurrencies, which will make this kind of property more approachable and easy to purchase in order to sell or rent, allowing its owners to obtain a passive income.
Market Challenges and Regional Leaders
However, not all is rosy for the virtual real estate market. It is still an insurgent sector that still has to find its place, as it is very different from the real world real estate market. Every virtual land will have its own price depending on several factors that are different from case to case. The report states:
Virtual land price does not follow the pricing pattern of the physical world. Therefore, the value of digital assets, including metaverse real estate, would basically depend on how the buyers perceive their price, thereby leading to fluctuations.
These fluctuations can negatively impact the investments of companies and users interested in getting into these nascent instruments. Most of this proliferation will come from investors and companies in North America, with the region accounting for 41% of the investments made during the indicated period, also as a result of the high adoption of applications that include metaverse technology.
Another report released last February estimated that metaverse real estate sales would reach $1 billion this year