Non-fungible tokens (NFTs) aren’t exclusive to the art world, in fact, nearly anything can be sold as a digital asset these days. And while a song or a piece of art that’s minted as an NFT can be downloaded by its owner — giving it a ‘physical’ feel — other digital assets are much more abstract.
Real estate has become the latest industry to embrace NFTs. Livabl has previously reported on an LA realtor who tried and failed to auction his Thousand Oaks duplex alongside a pop art-inspired NFT, as well as a listing for an $87.7 million Bel Air estate that includes a $7 million NFT art collection.
The latest NFT craze within the real estate sector isn’t related to physical properties at all, but rather digital land and structures that exist in virtual worlds like Decentraland. For the uninitiated, Decentraland is a blockchain-based, online multiplayer game that allows users to buy, sell and develop digital land. Save for the roads and a community hub known as Genesis Plaza, everything in the metaverse can be acquired using a cryptocurrency called MANA.
The virtual parcels within Decentraland are aptly known as “LAND,” and the game’s blockchain infrastructure allows real estate transactions to be recorded or transferred with ease. Measuring 256 square meters, each parcel of LAND is purchased as an NFT, which has a unique identification code. LAND-owners have total control over their properties, and can decide what virtual developments they build onsite to attract other users, whether it be an art gallery or a music venue.
Brands have even begun to advertise in Decentraland. In June, Atari announced it would be “[taking] over a large Estate in the metaverse” — an Estate is defined as a cluster of neighboring parcels of LAND — to create a retro arcade with classic Atari games like Pong and Break-Out!
Beyond profiting from buying, selling and developing LAND, digital real estate investors who own desirable parcels within Decentraland could feasibly get paid by real-life companies to create interesting virtual spaces as a form of sponsored content.
If this all seems like the fever dream of someone who played The Sims too often in the early 2000s, here’s some food for thought: A Decentraland Estate consisting of 259 parcels recently sold for 1.3 million MANA — more than $900,000 — making it the most expensive virtual land transaction of all time. The Estate was purchased by a US-based virtual real estate firm called Republic Realm.
Interest in virtual real estate is picking up. The Alibaba-sponsored Taobao Maker Festival, taking place from July 17th to the 25th in Shanghai, features over 1,000 virtual structures designed as a collection of NFTs by Chinese artist Heshan Huang. Comprising 10 freehold luxury villas, 300 high-end building units and 1,000 umbrellas, the for-sale NFT collection exists within the virtual Bu Tu Garden Community. Huang told Blockcast.cc that the structures exude a “socialist cyberpunk” aesthetic.
While virtual real estate is laughable to some, others see it as a legitimate asset that could appreciate in value. And hey, you won’t have to ask your friends to help you move when you purchase a new “home” on the metaverse!
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
