Last Modified:
November 13, 2021

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Online business is growing at a phenomenal pace. According to recent reports, the market is currently valued at $470 billion, a figure that is set to rise to an astounding $563 billion by 2025. 

Source

If you want to secure your own piece of this pie, one way to do so is by investing in digital real estate.

Digital real estate is a form of property investment similar to traditional real estate, except that you are dealing with assets that only exist online. 

The practice of investing in digital real estate is becoming increasingly popular, and if you haven’t done so already, now is the time for you to get started building virtual assets that will provide you with a viable source of income and wealth. 

If that sounds appealing to you, then read the rest of this article to discover more about digital real estate, what it is, and how you can get started investing in it.

What is Digital Real Estate?

Digital real estate refers to any online asset that you can rent or sell for profit. It works in the same way as traditional real estate where you buy a house or land to sell or rent to make income from it. This type of investment gives you an opportunity to earn passive income online.

When most people hear the term “digital real estate” the first thing that comes to mind is a blog or website. But, online real estate isn’t just about blogs. It also includes a wide range of assets, such as:

  • Affiliate Websites: Sites recommending affiliate products and when someone purchases a product, the referrer gets a commission.
  • Authority Blogs: These specialize in a particular topic or niche. 
  • Apps: Mobile applications for tablets and smartphones. 
  • YouTube Channels: Videos on the channel can be monetized. 
  • eCommerce Stores: Includes Shopify stores, Etsy stores, etc.
  • Social Media Assets: Facebook, Instagram, and Pinterest accounts, etc.
  • Domain Names: Website URLs or addresses not in use.
  • Digital Products: Includes courses, ebooks, membership programs, guides, etc.
  • Email Lists: A list of engaged subscribers can be a lucrative investment. 

Basically, the term digital real estate can be used to define any type of “property” that exists online and can be bought or sold. 

Note that by this definition, things like Bitcoin, Ethereum, and other cryptocurrencies (though not technically “real estate”) may also fall in this category. 

Examples of Digital Real Estate

The list above outlines some of the most popular digital investments. But I figured it would be a good idea to include some real-life examples as well.

Here’s a closer look at five of the most frequently chosen options that are also among the easiest to implement:

1. Authority Blog – OneHourProfessor.com

This is my blog that is focused on helping people create and grow their own online businesses. The blog has a ton of helpful articles on how to design, build, and launch a successful and profitable blog. 

There is also a free blogging course for beginners to help you jumpstart your journey to digital real estate investment.

2. YouTube Channel – One Hour Professor

In addition to the blog, One Hour Professor also has a YouTube channel with a thriving community. 

It’s always a great idea to have a YouTube channel as well as a blog because while the blog may be a great learning resource, some people might enjoy learning through videos, instead. 

On this YouTube channel, you’ll find tons of helpful videos on topics such as online business, entrepreneurship, passive income, and much more.

3. Shopify Store – Fashion Nova

This is an exceptional online store that will inspire any aspiring eCommerce merchants to build their own successful business.

The brand has emerged as one of the most popular fashion eCommerce companies of the past year and grossed over $400 million in revenue. 

Most of this is thanks to the company’s USP (unique selling proposition) which is that they offer quality, affordable clothes for men and women of all shapes and sizes, as opposed to the common stereotypical sizing you see on other fashion brands.

4. TikTok Account – Charli D’Amelio

With over 126 million followers, Charli Grace D’Amelio, a dancer from Connecticut, has the most followed TikTok account. 

She became one of the most popular stars on the platform thanks to one of her videos that went viral and earned her millions of followers in just 6 months. 

Now she earns a healthy income from her presence on this social media platform. Her story makes it clear that anyone can make it online with the right strategy – and a bit of luck. 

5. Instagram Account – Semi Sweet Mike

Semi Sweet Mike posts unique photos of cookie designs on his Instagram account. He also sells cookie cutters in his online store. 

One of the reasons for his massive success is that instead of showing an image of the actual product, he shares the finished batch of delectable cookies to show his audience what the product is capable of. 

This works a lot more effectively to entice people into buying his products compared to a picture of a cookie cutter. 

How to Invest in Digital Real Estate

There are a lot of different ways you can go about investing in virtual real estate, but in order to find success, you need to have a clear strategy. 

To help you in that regard, I have outlined the different ways in which people can invest, as well as a step-by-step process to start accumulating digital assets.

1. Build Your Own Blog

Building your own blog is very similar to buying a property, except that you are building your own home on the internet. 

One of the main advantages of this type of business is that it costs very little to start, although it does require much of your time – at least in the beginning. 

Over time, your efforts will compound and you’ll start gaining momentum. Within a few months, your digital asset will grow tremendously and you’ll start to see real results. 

To get started building your website or blog, you need to purchase a domain name and get web hosting. You also need a content management system (CMS) like WordPress. 

We will talk more about that later, and you can also read this article to discover everything involved in building your own blog

2. Buy Digital Real Estate

If you don’t have the time or inclination to create your own blog, another way to invest in digital real estate is to buy it instead. Depending on your needs, there are a lot of different places where you can get websites. 

Here are some of the best places to begin your search: 

  • Flippa, Empire Flippers, and FE International: These are three of the top marketplaces for buying and selling websites. These platforms are particularly suited to big businesses that are more established. 
  • Motion Invest: This is a better option for smaller websites and comes with a free website valuation tool to make your work easier so you don’t overpay for your new digital real estate investment. 
  • Human Proof Designs: This is ideal for starter sites and will provide you with excellent service and fair market value. 

3. Buy Social Media Assets 

Buying a social media account is another way to invest in digital real estate. You can go on sites like Fameswap, SocialTradia, or Toofame to purchase Instagram accounts, TikTok accounts, and YouTube channels, among many others. 

These platforms will provide you with a safe place to buy or sell social media properties so you can supercharge your money-making efforts. 

When you buy a social media account, you get unlimited access to a niche audience and you can save a lot of money on marketing. 

Working with social media influencers can be quite expensive, and rather than pay for costly collaborations, you can purchase a social media account where you can promote your products or services to a broad, targeted audience for free.

Pros and Cons of Investing in Digital Real Estate

Anyone can invest in online assets. However, it’s important to understand the benefits and drawbacks that come with this type of investment. 

Here are some of the pros and cons of investing in digital real estate.

Pros: 

  • Low Initial Investment: Investing in digital real estate doesn’t have to be costly. For instance, you can register the domain name for as little as $8 and pay $3 a month to host it.  
  • Passive Income: Many types of digital real estate investments require minimal maintenance, which makes them ideal for anyone who wants to create a source of passive income.
  • Scalable Income: Your online assets may increase in wealth exponentially, and there is potential to scale your income infinitely since the internet never sleeps, and you’re dealing with a global audience.
  • Income Diversification: As an investor, you understand the importance of diversification. Digital real estate allows you to reduce the risk by making it easy for you to diversify your investments.
  • Time and Location Freedom: Online business allows you to free up your time and make money on your own terms. This means you can work from anywhere in the world where there’s an internet connection.

Cons: 

  • Requires Skills: If you intend to build and grow your own digital real estate, you may need to upgrade your skills. The only way you won’t need to learn specific skills and if you want to passively invest in digital real estate through a third party.
  • Unpredictable at Times: Digital real estate can sometimes be volatile. For instance, some affiliate marketers suddenly found themselves with half their income taken away when Amazon Associates suddenly slashed their commission rates. Also, Google algorithm changes can impact your rankings, traffic, and sales. On social media, if your account is banned, you can lose your audience (and income) instantly. 

Understanding Digital Real Estate Multiples

Multiples are used when attempting to accurately value a website or other digital asset for sale. Typical multiples these days range between 20x and 50x the 12-month average net profit of any online asset. 30-35x is the most commonly used range for websites. 

This means that when selling or buying an online business, you can multiply the next monthly profit by the multiple figure in order to arrive at the estimated value. 

There are certain factors that can affect the valuation by driving the multiple either up or down. 

For example, when buying or selling a website, factors that can impact the value include:

  • Demand: Valuation increases when there’s demand for the business in general.
  • Domain Name: A good name with good authority will command a higher price.
  • Traffic Quality: Is the website traffic high-quality, predictable, steadily growing, etc.?
  • Predictability of Revenue: For instance, a site with one affiliate vs. a membership site.
  • Site Management Requirements: You want an up-to-date, easy-to-use platform.
  • Diverse Revenue Streams: E.g. multiple affiliate vendors, or affiliate + advertising, etc.
  • Website Age: Ideally, you want a website that has been around for at least two years

As you can see, there are a lot of factors to consider when deciding on the value of an online asset. 

It’s important to take the time to understand digital real estate multiples before making a purchase in order to ensure that you get good value for your money.

How Much Money Do You Need to Invest in Digital Real Estate?

The amount of money you need to get started depends on the type of digital asset you want to invest in. It ranges from just a few dollars to thousands of dollars. 

For instance, startup expenses can be as low as the cost of starting a blog, which includes about $10 for the domain name, and around $3/month for hosting. 

In fact, you can start blogging for free by signing up for a free trial or free version of one of these website hosting companies.

You can also create your own digital products for free, and start selling them online on your blog or social media. 

However, as with most other types of businesses, sometimes you have to invest money if you want to experience results faster. So, although you can create a blog for free, you may not be able to monetize it as easily. Also, it’s hard to build trust with your audience when you don’t have your own domain.

When looking to buy digital real estate, costs increase to hundreds of dollars, and even thousands, for established businesses. 

The good news is, regardless of the type of digital real estate you’re interested in, you can start building and growing your online asset without having to pay hundreds or even thousands of dollars. All you have to do is invest more of your time and effort into building a solid, revenue-generating machine online. 

How Does Digital Real Estate Make Money

Digital real estate makes money in a wide range of ways depending on the asset. Below, I’ve listed a few examples of growth for some of the business models discussed in this article.

Display Advertising

This is one of the most commonly used ways to monetize a website or blog. Display advertising is easy to set up and you can start earning money from your website traffic immediately. 

All you have to do is sign up on networks like Google AdSense, Ezoic, and Mediavine and the companies will start showing ads to your website visitors. 

You will be paid for each ad view or click, and your income will increase as your audience grows.

Affiliate Marketing

Another commonly used monetization method is affiliate marketing. This can be done with your own website or on social media. 

To get started, sign up as an affiliate with your chosen companies, such as Clickbank, Amazon Associates, Commission Junction, etc. 

Find products to promote, get your affiliate link, and share it with your audience whether on your blog, YouTube channel, email, social media profiles, or anywhere else. When someone makes a purchase through your link, you will be paid a commission by the merchant. 

This is an excellent way to build your online business and grow your income – particularly since it costs nothing to get started, and yet the potential for growth is limitless.

Sell Your Own Digital Products

Creating and selling your own digital products is yet another popular income stream used by a lot of businesses online. 

The types of products you can offer include:

  • eBooks
  • Courses
  • Templates
  • Checklists
  • Video Tutorials
  • How-to Guides
  • Whitepapers
  • Apps
  • Graphic Designs, etc.

The great part about these types of products is that you only have to create them once, and you can sell them to thousands of people. 

You can sell digital products either through your own website or through third-party sites like Clickbank, Amazon, etc.

Sell Your Services

If you have some skills or knowledge that you can offer, such as web design, writing, social media management, etc., then this is a great way for you to earn money online. 

Although this isn’t a means of generating passive income, it’s still a great way to start making money without making a huge investment up front.

You can even start for free by offering your services either on your own blog or on social media. Once you secure clients and have a predictable flow of income, it will be a lot easier for you to focus on other types of digital real estate that require a financial investment. 

Sponsored Content 

Another great way to make money online is to offer sponsored content on your website. You can do this in the form of product reviews where brands pay you to write about their products or services, or you can create product reviews or tutorial videos on YouTube and other social media sites. 

Start a Membership Site

You can offer exclusive memberships on your website so people can pay to join and get members-only content and other perks, such as one-on-one advice, free consulting, etc. 

This is a great way to generate passive income, and your only limit to your income is in how well you can market your site to get new members and keep old ones coming back. 

Some sites charge as little as $5 per month while others charge $197/month or more, which means that the amount you make will vary depending on your membership fee, as well.

How to Get Started

By now, you should have a clear idea of which direction you want to take with your digital real estate investment. 

All that’s left is to create a strategy for getting started, and you’ll soon be generating money online from your chosen investment. 

It’s beyond the scope of this article to provide you with all the information required for how to invest in the different types of online assets. Instead, I’ve included resources with in-depth information to help you get started right now on your journey to investment success.

  • Start a Blog or YouTube Channel: Sign up for my free course to discover everything you need to know about creating a blog or YouTube channel – from how to choose a great name, all the way to promoting your blog/channel, and monetizing your audience.
  • Buy Properties Online: To buy properties, such as websites, head over to Flippa, Empire Flippers, or FE International. These sites are perfect for bigger, more established businesses. For smaller sites, check out Motion Invest. If you want starter sites, you’ll find what you need at Human Proof Designs.
  • Buy Social Media Accounts: If you would rather purchase an Instagram account, TikTok account, or a YouTube channel to jumpstart your journey into entrepreneurship, then you can go to Fameswap, the oldest and most trusted marketplace to get established accounts with followers, likes, and real audiences.

What Do You Think?

Digital real estate is an excellent way to create a reliable income stream. You can invest in more than one type of online asset as a way to diversify your income stream and increase your profits. 

Use this article as your resource to help you get started in one of the many options available to you.

If you have questions about investing in digital real estate of building from scratch, I’d love to hear from you. Comment below, I check my comments daily!

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