Chinese property buyers flock to Metaverse as nation’s IRL market sags

Virtual real estate becoming a hot commodity in China

TooRichCity (Twitter)
TooRichCity (Twitter)

Chinese property buyers are flocking to the Metaverse as the nation’s real-life real estate market sags and developers such as Evergrande face default.

Digital artist Huang Heshan sold 310 virtual homes in his online city TooRichCity in two days, raking in the equivalent of about $62,700, according to Sixth Tone. The homes were sold as non-fungible tokens, or NFTs, which are units of data stored on blockchain technology.

While that may not sound like a lot of money, land prices in the U.S.-developed The Sandbox universe have jumped exponentially: Lots now sell for $15,612, up from $1,175 just two months ago.

Virtual real estate has taken Chinese buyers by storm in the last year, according to the outlet. ”Metaverse property” was the most popular industry news term in 2021, according to China Real Estate Business.

Heshan is one of many artists in China who have created virtual cities that sell digital blocks of land to consumers.

Sign Up for the undefined Newsletter

“Metaverse property represents the right to choose your own lifestyle,” said one Chinese Sandbox investor, referred to by his online pseudonym Carson, who is a member of LuluLand — a crypto community that runs a virtual world in The Sandbox.

Chinese mobile game maker Honnverse also offers virtual homes, 3-D models that serve as home base for users. In October, the homes traded on a secondary market app after the game launched. Some for $150 to $470.

Skeptics are baffled. “This is all fake,” one user told the outlet. “I believe in the metaverse, but Honnverse and metaverse are two different things — having a property in Honnverse is like FarmVille.”

Other users are spending money to view, design and build their own homes without buying the underlying NFT. Beijing-based VR start-up Pico Interactive, which was recently acquired by China’s ByteDance, operates virtual reality headsets that users can use to explore virtual property.

The increased popularity of virtual homes comes as Evergrande struggles. This week, it was ordered to demolish 39 buildings at a Chinese resort in the province of Hainan after officials said the building permits had been illegally obtained.

[Sixth Tone] — Isabella Farr