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VO [00:00:06] You're listening to REINCheck with Andrea Rice, Contracts and Industry Specialist at REIN, where you get the latest member news and information delivered straight from the source, REIN MLS.

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Andrea Rice [00:00:20] Hello and welcome to REINCheck. I'm your host, Andrea Rice, and today we are checking in with journalist Kristi Waterworth. Kristi writes about real estate in the metaverse for The Motley Fool, and Kristi comes to us today with a wealth of knowledge about the metaverse and as a former realtor, is the perfect guest to help us understand the metaverse from a real estate perspective. So, Kristi, thank you so much for taking time to be here today.

Kristi Waterworth [00:00:44] Hey, it's great to be here.

Andrea Rice [00:00:46] So, I did read somewhere that not only are there places to purchase like homes, businesses, land, but there's some rental stuff going on. Can you tell us anything about that?

Kristi Waterworth [00:00:59] Yeah, I actually had a guest on The Motley Fool podcast last week, who is metaverse landlord. And they do all kinds of different things with these pieces. Sometimes they'll just buy empty land and they'll rent it out to businesses who are curious but not ready to commit. So, the business will rent the property and they'll construct their whatever they're going to build there and kind of get a feel for it and see if they want to stay. And a lot of times they do and, you know, if they can't find a better location, you know, continuing to rent that spot makes sense to them. In other cases, you've got like billboard owners who are renting out billboard space. And although this isn't a huge business yet it's going to be one of the few ways that you can get an ad into the metaverse without building like a structure. So, that's something that I feel like it's a really strong future. You know, obviously, you don't want to overpopulate with billboards, but the gentleman I was talking to, he has three billboards in Decentraland. And that leaves lots of space for other billboards, you know, there's lots and lots of room. And then you also have companies that builds like whole properties for lease. So if, say, you have a small business, but you have some kind of product. Like fashion right now is really big. So, let's say you have a small business and you're in the fashion industry, and you want to get in on this whole NFT fashion thing that's going on right now and make a little bit of extra money. It's like a virtual copy of your product. You can rent a fully constructed storefront and sell your NFTs out of there. There are other properties that are for other companies that are working on other technology, like direct from metaverse to home delivery systems. But those we haven't seen them yet, so we don't really know what they're going to look like. But both Panera and Walmart are working on those. So, they're big, they're going to be able to crack that nut.

Andrea Rice [00:03:23] Yeah, I heard a little bit about that, and I thought that was interesting. And I have seen one. I didn't really understand it until you were really talking about it just now, but one big designer I saw was offering NFTs of his new collection, and I was like, what is this, right? Like, I was like, oh, how do you get this? And then what do you get?

Kristi Waterworth [00:03:45] Avatar personalization is such a big deal. And, you know, it's one of these things that things are a little harder for us to understand because we're we didn't really grow up with like Roblox and Minecraft and stuff. But for those people who did, they're the oldest group is 25 years old. They are well into their careers. They're capable of spending all kinds of money if they want to in metaverse. And for them, it's sort of just normal-ish, you know, like it's not a big deal to go into and buy a personalized NFT pair of it's like a pair of Nike's for their avatar because they meet their friends there and they want to look cool or whatever.

[00:04:32] Right. Yeah. I was asking my 14-year-old like, what do you know about the metaverse, or what do you think it is? And she was saying exactly what you're saying. To them, it's not even a foreign concept. Of course, this makes sense, right? And I think it's like you're saying like for us that we didn't grow up with that kind of stuff. So, it takes us a little bit longer to kind of latch on to it and figure it out. But you know, you and I had talked last week and you had said, you know, people complicate it a lot more than it needs to be complicated. And I think you're dead on with that because I think I do that you put this mental block up before you even start to access the information.

Kristi Waterworth [00:05:13] Yeah. And I mean, it's easy to do because i's you kind of have a couple of different groups in the metaverse right now. You have the metaverse communities who are really interested in building community, and they're trying to get people in. But they're so enmeshed in it that they forget that there are new people out there, you know, and they don't really know what they're doing. And then you have the other group that is kind of like newer, but they want to sound like they're super edgy. So, they just throw out like every technical thing they can think of. But really, for the purposes of a user, like a general user, there's just not that much to it. It's just a virtual world. It's not a big deal. It's just like getting on your Nintendo and running around in a 3D environment.

Andrea Rice [00:06:02] Right, right, yeah, I think for some of us, I remember the first time I saw the internet, right? Like, we all went to my friend's house and he was like, I have the internet and we're huddled around the computer and we're like, what is this internet? And I feel like this is kind of the same thing. Like, now we're all huddled around going, what is this metaverse? You know.

Kristi Waterworth [00:06:20] I mean, it really is. It really is sort of a retooling or rethinking of how the internet works. You know, I don't know when you all first go online, but when I first got online, there was Harvard [inaudible]. It was either Harvard or MIT, and they had a coffee pot that they had a webcam trained on. And the reason they did this was because some people in the computer science department didn't want to go all the way to the faculty lounge to find out the coffee pot was empty. But it ended up becoming this huge thing, and people would check in on the coffee pot to see if it was full or not because it was amazing, like, this is the first time we could really see someone else's coffee pot with a webcam. And it was just it just broke your brain. And now it's like, oh, everybody's got a webcam everywhere.

Andrea Rice [00:07:04] Right?

Kristi Waterworth [00:07:05] Look it's my dog.

[00:07:06] Right. Now it's like, oh, this is just everyday stuff. And I think that's what's going to, you know, our concept of the metaverse. Pretty soon it'll be like, oh, how is there a time when we didn't know what it was?

Kristi Waterworth [00:07:18] Exactly. And I think that's also why it's important to be really. you know, for those of us that are real estate professionals or real estate industry to really be considering the real estate portion of this right now. Because right now we're looking at prices of ten to fifteen thousand dollars in general for a piece of land. But in five years when everyone's caught up to us, what's that going to look like? It's hard to say like, I can't guarantee it's going to go up, but demand right now is very high.

Andrea Rice [00:07:53] And I think, you know, that leads me back to how things are going to progress in the future, and a lot of what I've seen is that people are saying blockchain transactions. That real estate transactions are going to be 100 percent blockchain transactions. So, is there anything you can tell us about what that would look like or what that means?

Kristi Waterworth [00:08:17] I'm so glad you asked. That's totally unrelated to the metaverse, just to be clear because there are basically two different things going on here like real-world real estate is being there testing different ways to apply blockchain to real-world real estate to make things a lot more simple. So like, for example, in New York City, right now, they're doing a I want to say it's a 500,000 parcel test within their recorder's office, trying to record deeds and onto a blockchain system and make title work a lot easier. So, what they're going to be doing is essentially speeding up title search instead of going to the courthouse and digging through boxes of old records or going through old microfiche or doing God knows what depending on how old the places where you live, you know how long your properties have been there. Essentially, these properties are all going to be on the blockchain, and you can just access them very quickly with an inquiry. So, it's instead of title work taking two weeks, it might take two days. And of course, because the blockchain is very secure and it's very difficult to change, you know, it's much easier to add another chain to the link, if that makes sense, then it is to erase everything and start over and you have this like chain of title that's literally kind of like a chain of title, like a chain of title, because everything's connected to the thing before it. And it's going to make title insurance cheaper I think, eventually. And it's going to make title searches faster and easier. The thing that we don't really have sorted out yet is how to pass a piece of real estate using only an NFT, which is again, it's a digital deed. So, in theory, this works, but in practice, it doesn't because of the regulatory environment that we're currently in. So, if you want to pass a single piece of property to a single owner using an NFT, you can't really do that. The people that are claiming to be doing that, I talked to quite a few of them, and what they're really doing is passing something more like a receipt or some kind of representative NFT. Maybe it looks like that's a graphic looks like a house or whatever, just kind of as a gimmick, as a gimmick to pull people in. But they are working on ways to tokenize real estate purchases like commercial real estate purchases. So, if you wanted to get in on an apartment complex, which you want to be just a part-owner, not a whole owner, then that makes more sense because it's easier to issue 10 NFTs that give you ownership rights than it is to keep going back to the table to redraw the documents every time you have a partner trade out. So, you just buy and sell the same NFT instead of having to constantly redo the title work, which is great.

Andrea Rice [00:11:29] Interesting. Yeah, and from my understanding, like things that happen on the blockchain, like nothing ever gets destroyed, right? Like just like you said, it just adds to it. Like you would always have this record

Kristi Waterworth [00:11:41] Right. You can kind of think of it like for me, mentally, I think of it like a bicycle chain. So like, there's just you just add another link every time you make it longer. Some people think of it as like a digital ledger, but you know, like you can erase things off a ledger, so I don't know about that. But basically, it's just, you know, you just only add you cannot subtract. And again, that makes it really easy to prevent fraud because there's a record of absolutely everything. And just because someone may be wondering how that's possible, what happens is that every computer that is running that piece of that particular blockchain program has a copy of the ledger and they check it against each other. And that's how we verify that the information is correct and not fraudulent in some way. So, if they all agree then it's added and everything's fine.

Andrea Rice [00:12:40] Interesting, thank you. I really was interested to hear what you had to say about that. And then, you know, I also just wanted to know if you could share with us, you know, how do you feel that agents fit in the universe and how do you think they can take their, you know, physical business virtual? Or maybe if they don't even want to do that, just like how can they find out what opportunities might be for them in the metaverse?

Kristi Waterworth [00:13:08] Well, I think commercial agents are going to find a lot more utility in the metaverse because they already have connections to brands and businesses that are looking for different kinds of things, like very specific things, you know, and because you're not necessarily going to have first-time homebuyer come into the metaverse and go oh, I want to buy something because I don't really like, yes, they can. And yes, there are reasons to. But a residential sort of metaverse buy is more of kind of a. What I had to describe this, but it's more of like a vanity purchase, whereas a commercial real estate buy in the metaverse is a utilitarian purchase. So, you have a reason to be there. You know you're showing off your products, your advertising, you're creating different kinds of space where you can present things like, for example, Samsung has a virtual store in Decentraland. And when they were announcing their new products at the beginning of the year, they actually did part of that presentation within their new space where they had just finished. So instead of just sort of like everything at an expo where only certain people can get into because it's in Miami or it's in Las Vegas or wherever, you know, they have these spaces where everybody can come in and go, oh, well, this is really cool. Like CES, you could do potentially do a portion of that at these kinds of things or Fashion Week right now is what's taking place in Decentraland, where a whole bunch of fashion brands are coming together to show off what they've got. Like high-end fashion brands. So, commercial realtors are going to find opportunities to bring in brands that they're working with or companies that they're working with and, you know, get them spaces before everything sold before all the good stuff's gone. And they're also going to find opportunities to if they really know a metaverse space, they're going to find opportunities to connect with companies that are trying to figure out how this metaverse stuff works. I have been in contact with some people at eXp in California who are doing just that, and they're trying to sort of connect brands to try to find the right properties for these brands because they don't the brands don't have time to research what the land is like there and what would fit their needs the best and in those sorts of things. So, they rely on someone else and they're going to be looking for realtors specifically because that's who they would go to if they were going into a new market.

Andrea Rice [00:15:59] Interesting. So, I think there's a lot of different opportunities there and just things to I mean, just things to learn about, to investigate, to see where you fit in.

Kristi Waterworth [00:16:10] And the thing with the metaverse is that there is literally no end to the opportunity. If you think it's one of those, one of those as cheesy as it is it's an if you can dream it, you can do it kind of situations because there isn't gravity or building regulations or sewer that you have to run, you know. So, there's a lot of potential there that doesn't exist in the real world, and it's much cheaper to build things than there is in the real world. So, right now, the audience is still a niche audience, but it's getting bigger. It's growing all the time. So a lot of brands, just like they're really trying to get in there and they just can't figure out how to do it.

Andrea Rice [00:16:50] Yeah. And I think, you know, like you said, it's getting bigger and people are figuring it out. And, you know, if you can be a part of it in the beginning stages, figure it out. Like you said, if you can dream, it can happen. So, some of it may be just like, think about what you want to do. If the metaverse is something you want to get interested in and invest in or play a part in, you know, just see what's out there and into that note I will say, please check out all of Kristi's articles on The Motley Fool because she has a ton of articles that she's written on the topic, you know, specifically, real estate-focused, and you have a lot of good information about the different platforms. You have a lot of good stats and things out there that really put it into a real-world perspective for you. So before we sign off, Kristi, is there anything else that you would like to add?

Kristi Waterworth [00:17:52] There is so much that I would like to add there's just not time for it all. But yeah, if you check out my portfolio there at The Motley Fool, you're going to find a lot of good data. We recently wrapped up a research project that is the first of its kind and would be possibly very useful for first-time metaverse buyers. So that would be something worth looking into. You'll see it right there in the collection.

Andrea Rice [00:18:18] Great, thank you. Thank you, Kristi, so much for being here today and sharing all this wonderful information. I hope that we can have you back again in the future because this is an exciting and really evolving topic. So like you said, there's so much to talk about. So thank you, thank you, thank you for coming, and thank all of you for listening. Be sure to check out Kristi's articles on the metaverse at the Motley Fool. As always, I invite you to subscribe to REINCheck so you get each episode delivered directly to you when they are released and you don't miss a single episode, so thank you, and have a great rest of your day.

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VO [00:18:51] You've been listening to REINCheck with Andrea Rice. Stay in the know from those who know. Delivered straight from the source, REIN MLS.

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