There are currently limited options for earning money from digital real estate. The space isn't as well developed as the physical real estate market. But, there are a few reputable options to go for when you're trying to monetize on the current hype surrounding digital real estate investing.
The four ways to make money investing in real estate
1) Buying and Selling Metaverse Real Estate
2) Renting Metaverse Land
3) Tokenized Fractional Ownership
4) Real Estate Derivatives Trading
Four Methods To Earn Money From Digital Real Estate
Buying & Selling Metaverse Real Estate
A popular way to make money within the Metaverse is to buy and sell virtual land. With the Metaverse expected to be worth $800 billion by 2024, land prices can be expected to skyrocket. Metaverse sales have just recently topped $500 million in 2021.
There are dozens of Metaverse crypto projects out there that are surging in popularity even when the market has had a rough few months. It's also an incredibly lucrative method, with some Parcels of land selling in the millions of dollars.
The only issue with this option is that although it's cheaper than buying physical real estate, it's still pretty expensive to buy land from the more popular metaverse crypto projects.
It might be better to start looking for less popular options and buying up land if you believe the virtual world will take off in the future. This, of course, carries a lot of risks as you're holding cash in an asset that has experienced some high volatility in the past.
Renting Metaverse Land
You can also rent out your digital land to other people like physical real estate. This money-making method could quickly become popular as the market grows and demand soars. Some large companies such as Nike and Rolex are looking to rent Parcels of land.
The most popular way to do this isn't by doing it alone but as a metaverse fractional ownership agreement via a DAO. Using the platform - LandWorks - you can rent out your Decentraland real estate, and in return, you'll receive payments in their native token, ENTR.
LandWorks is run by EnterDAO. Some other options are AxieDAO and PangiaDAO, which all pool assets in order to purchase the land. This could be another profitable option. But, your profits all depend on your initial investment, and if you're not investing hundreds of thousands of dollars, it could take some time to see a decent profit.
Tokenized Fractional Ownership
Tokenized ownership provides you with two ways to profit, one being the regular rent payments typically paid daily, and the other is the appreciation of the token's value. Tokenized ownership allows you to own small amounts of property.
There are a few platforms out there when you're looking to take advantage of tokenized ownership; RealT is a popular platform that many beginners use. Essentially you invest a custom amount of money into an individual property; you'll receive daily rental payments in the form of a native token or USDC/USDT.
You'll also receive your tokens which represent a fraction of the property that you own; these can also be bought and sold and can make you money if they appreciate in value.
The biggest issue with fractional ownership is that the platforms just aren't popular enough to have a steady supply of properties to invest in. So, the properties that are listed on the platforms are often heavily oversubscribed, making it much harder to make quality passive income with such a small share of the property. If you're lucky enough, you'll be able to invest in a few properties.
Real Estate Derivatives Trading
Parcl uses derivatives to allow investors to invest in real estate like they would with Bitcoin, Ethereum, or Solana. You'll be able to invest in areas such as Manhattan, Soho, Tribeca, and many more with the click of a button.
The latest addition to the digital real estate space is the ability to trade real estate that exists in the real world like you'd trade Bitcoin, Ethereum, or Solana. Parcl is currently the only project offering this innovative method of property investing.
This is also the first time you'll be able to hedge against evolving markets and react to the world around you through real estate investment. For example, when Covid hit the streets of Manhattan, property prices plummeted; with Parcl, you could have sold the Manhattan Parcl and bought some suburban neighborhoods Parcl as people fled to quieter and more spacious areas to protect their families from disease.
The benefit of Parcl is that we provide immediate liquidity, which is unheard of in traditional real estate. We are here to make real estate investing accessible by lowering the financial barrier and reducing the unnecessary and tedious tasks often required in traditional property investing.