How NFTs Could Transform Real Estate Investing
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Virtual land sales take place daily in Decentraland, but a recent purchase by real estate investors has taken virtual land investing to a whole new level. According to Yahoo Finance, 259 plots or 16 acres of digital land purchased by Republic Realm cost over $ 900,000, the most expensive NFT land purchase ever. NFTs, also known as non-fungible tokens, have been a hot topic of financial investment in the art industry. However, in recent months, NFTs have become increasingly popular in the real estate investment industry. The ability to buy and sell property on blockchain-based platforms like Cryptovoxels and Decentraland indicates that blockchain is reshaping the real estate market. If you’re looking to invest in this blockchain-based real estate trend, read on to find out how NFTs could transform real estate investing.
Rise in virtual real estate
Oddly enough, many real estate investors invest large sums of money in virtual real estate. As the name suggests, virtual properties are intangible plots or plots of land that only exist in a blockchain. It should be noted that the price of land or virtual fields depends on how much one is willing to spend. For example, Mars House, a digital real estate that sells for $ 500,000 on an NFT marketplace.
A few months later, investors made virtual land sales worth $ 3.5 million in The Sandbox, a blockchain metaverse. If you are like a lot of people, you might be wondering why invest in NFT real estate? For many investors, the uniqueness and ease of transfer of ownership from seller to buyer adds value to their investment.
NFT Mortgages
In addition to making virtual real estate a reality, DTVs could change the mortgage industry by improving the home loan process. The current method of obtaining mortgages is expensive and labor intensive, unless you are lucky enough to find a mortgage lender who is committed to providing excellent customer service. According to The mortgage expert, a customer-centric mortgage process needs to be streamlined from start to finish. This means that the lender has the whole home loan process under one roof. This way, they can close your home loan quickly and efficiently.
As the real estate industry embraces NFT, borrowing home loans could be less stressful. This is because the tokenization of property rights makes the process of managing and trading homes easier. Ideally, you can buy NFT real estate and borrow it immediately at an interest rate of 2.4% using products like Defi and TradeFi.
Promotes fractional ownership
As an investor, you can use NFTs to tokenize your physical real estate to create a representation of the property in the digital space. This allows you to sell part of your property to a small or a large group of investors. Since NFTs are sold in a decentralized marketplace, you need to issue tokens to property buyers. If investors choose to keep the tickets, they may receive rental income or a profit split depending on the appreciation in value when the property is sold. Ideally, NFTs could pave the way for many investors to consider fractional ownership in the real estate market.
NFTs or non-fungible tokens have become popular in the real estate industry because they allow investors to buy or sell digital properties. This new blockchain-based technological trend will have an impact on the real estate investment scene by promoting the growth of virtual real estate. Industry experts also say it will encourage fractional ownership and streamline the mortgage lending process.
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