Ellen Britt for CNT #NFT
The price of virtual real estate is getting more pricey by the minute.
Virtual land parcels on some of the bigger metaverse platforms such as Decentraland, and the Sandbox are selling for hundreds of thousands and even millions.
Play in the Sandbox with Snoop Dogg!
The first week in December, a virtual parcel next to Snoop Dogg’s mansion in the Sandbox sold for a cool $450K in Ethereum (ETH). Metametric Solutions, a metaverse analytics firm, projects virtual real estate sales to reach an eye-popping $1 billion this year.
Enter the virtual mortgage business.
A company called Terrazero Technologies is offering home loans to folks wanting to acquire virtual real estate and has already closed its first metaverse mortgage deal with land in Decentraland.
A virtual mortgage works like its real-world counterpart. The buyer has to agree to the terms and makes a monthly payment until the loan is satisfied, with the deed itself being an NFT. A prospective buyer has to prove they can pay off the loan and have a viable business plan for the property.
Terrazero then purchases the virtual property on their behalf, holding the land in cold storage until the loan is paid off. But while the buyer is making payments, Terrazero grants them development rights, so the buyer can go ahead and make whatever improvements on the parcel they like, including building a house, so Terrazero has that as collateral in case they default.