When it comes to developments in the world of business, there is no denying that the ever-increasing presence and prominence of the online landscape has changed things for good. Once upon a time, the phrase ‘real estate’ was something reserved for physical properties and assets that could stand to improve fortunes, but in 2023, the concept of ‘digital real estate’ is well and truly established.
Digital real estate is a term that can be used to describe a number of online opportunities, including things like domain names, blogs, websites, cryptocurrencies, apps, digital products, social media accounts, email lists, NFTs (non-fungible tokens) and more. They are virtual assets across a number of different platforms, and under the right circumstances, they can stand to make people a lot of money.
With the direction of online activity and significance only set to go in one positive and upwards trajectory0 from this point on, savvy investors are beginning to see just how attractive a prospect the idea of collecting a portfolio of digital real estate might be. To help you understand further, here is a rundown of some of the top reasons why you might want to consider investing in digital real estate yourself.
- Lower Startup Costs
One of the biggest reasons that prevents people from investing in physical real estate is the big outlay that is required to actually get your foot on the first rung of the ladder. In this decade, economic forces like high inflation and stagnating salary rates are key factors in holding people back from getting into the physical real estate game as well as the starting point of the coast of a property. This major barrier to entry and other obstacles are not involved when it comes to digital real estate.
Something like buying domain names, for example, can cost as little as $10 per year to begin with, plus the fact that they are cost-effective to build and maintain thanks to a wide range of open-source tools.
It goes without saying that some of the other options like cryptocurrency and NFTs can be much pricier, but the great thing about the digital retail space is that there is so much to explore and discover at every price range.
- Global Supply
While there is always going to be a physical limit of space in the real world, the advantage that digital real estate has is that the boundaries are limitless. You are free to collect as many pieces of ‘virtual land’ as you can afford from NFTs to websites to domain names and more. This is regardless of your physical geographic location, and this levels out the playing field to make it just as easy for somebody who lives in a small rural location to have much success as somebody who lives in a bustling urban city.
Factors like taxes and geographical laws can make physical real estate rather limiting but there are virtually no barriers when it comes to acquiring digital real estate assets. There is a lot to learn, but much less red tape!
Investing in domain names, for example, involves a lot of guessing and predicting might be profitable in the future, but the guessing and predicting involved in this kind of game is far less risky than doing the same with expensive physical property.
- Portfolio Diversity
The great thing about digital real estate is that you do not have to put all of your eggs into one basket; there is much greater scope for diversity in your portfolio. There is such a wide array of virtual assets to explore and obtain that it allows for a really interesting and invigorating experience. With the direction of digital real estate only going in an upwards and forward fashion, it can pay off to be an early adopter of such diversity. There is the opportunity to become an experienced investor in a community where there are more novices.
- Quick Appreciation Rates
Digital real estate can be very profitable in the sense that your assets tend to appreciate at a much faster rate compared to physical real estate. A great example of this can be seen in the way that cryptocurrency has exploded over the last few years. In 2021 alone, the sector grew by almost 190%. The figures suggest that digital real estate investors can experience up to five times the buying value for successful websites, blogs, crypto and more.
According to the chief finance officer at Fameswap, the risk/reward nature of digital real estate makes it a far more attractive prospect, and low startup costs provide you with an immediate advantage and chance of making profit from the very beginning.
- Potential For Passive Income
Depending on which types of digital real estate you choose to invest in, there is, of course, huge potential for fast and healthy returns. Domain names are a perfect example of this, with some being available for as little as $15 and then growing significantly in value as the demand for this name increases.
The most expensive domain name ever sold was the simple cars.com, which commanded a sensational fee of $872 million! Fees like this are undeniably rare, but figures in the hundreds and thousands are relatively common when you make savvy and insightful choices ahead of the curve.
The great thing about this kind of business transaction is that it falls firmly in the ‘passive income’ category. The value for things like domain names and NFTs grows and grows without the owner having to put in any active work. It sounds like the dream business arrangement, but the risk factor for digital real estate comes in the form of there being no guarantee for any particular domain name, website, blog, NFT or more to grow in demand and popularity in the way that the owner might hope.
