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Feeling grumpy that the real estate market slumped right after you bought, or just before you sold? Here’s some news that should cheer you up right away. Sales of virtual real estate in cyberspace are doing very nicely. Participants in the virtual world created by Entropia Universe spent more than $200,000 of real money in July to buy imaginary rainforests, snow-covered mountains, riverfront estates, and more. In an Aug. 7 press release, Jan Welter, CEO of MindArk, developer of Entropia Universe, calls it a “virtual property boom.” Another imaginary world called Second Life saw real estate sales of over $660,000 in July, according to my colleague Rob Hof, who wrote a May 1 cover story about Second Life and its ilk.
The dollar figures quoted here are based on the going exchange rate for the play money used in the games. According to Rob Hof’s story, one gaming services firm estimates that players spent about $1 billion in real money last year on virtual goods and services in all of the online games combined.
Look at this way. Let’s say you lose your job, can’t pay the mortgage, get thrown out on the street, and wind up living in a cardboard box. Not a great situation. But you could still have quite a real estate empire in the virtual world. Even if you don’t have a roof over your head, your online avatar could be sitting pretty. So stop being so grumpy.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.