MORTGAGES are now available for properties in the metaverse, as the price of land in the digital world surges.
Metaverse developer TerraZero has started giving loans secured against the value of land for those looking to make purchases.
It recently issued a $45,000 parcel of ersatz land in an entertainment district of Decentraland.
The new financial product is a development of a trend that began over a year ago, with loans having already been taken out against NFTs.
Dan Reitzik, the CEO of TerraZero said: “We get hundreds of inquiries a day — ‘Can you help us buy property?’
“At first, we thought, ‘That’s kind of crazy,’ and then we were like, ‘Why not?’”
He added: “Everybody wins. Young people can’t own properties in the real world right now, but they can certainly own properties in the metaverse.”
Similar to traditional lenders issuing mortgages for physical properties, TerraZero will run a credit check on the potential buyer to ensure they can keep with repayments.
The company also requires a deposit before issuing the loan.
However, while mortgages for physical properties are usually for in excess of 25 years, Reitzik’s company requires repayment over a period of just two.
Plots of land in the metaverse have seen a drastic increase in value in recent months as interest in the digital space has grown.
Some plots in Decentraland are now selling for as much as $2.43million.
Prices have risen by up to 500 percent since October 2021.
