NFTs and Real Estate Images: What's Next?

The world of real estate continues to evolve rapidly, and real estate professionals and photographers need to stay up to date on the technological advancements in our industry. One exciting innovation is creating and using non-fungible tokens (NFTs). This emerging digital technology allows professional photographers to solve several crucial real estate image ownership issues.

Let's examine the real estate industry's challenges regarding photography and how NFTs can help.

What are NFTs?

Non-fungible tokens, popularly known as NFTs, are digital tokens created on the blockchain, just like cryptocurrencies. However, unlike cryptocurrency, each NFT is non-fungible, meaning each token is unique or one-of-a-kind in the world.

Each token represents the ownership of a specific digital file like a photo, video, or illustration. Ownership of the token is publicly verifiable in the most secure database known on planet Earth—the blockchain. This means that once an individual buys an NFT, it becomes the individual's unique asset, and only that person can claim ownership of it.

Think of the blockchain as a network of servers that each store a digital ledger. This ledger keeps track of transactions on the network, including who has bought and sold each NFT.

Blockchain technology is decentralized and distributed, making it incredibly difficult to hack into because no one person or company controls the ledgers. Hacking into one part of the system does not affect the other parts. Each ledger in the network must match and be validated by the others before a transaction can be recorded.

Examples of NFTs

The Bored Ape Yacht Club is one of the most well-known digital art collections available as NFTs.

Other examples include CryptoPunks and CryptoKitties, early projects typically credited with starting the NFT craze.

You may wonder what is stopping someone from right-clicking on these images to download the file or taking a screenshot? The simple answer: nothing. Anyone can steal an image online. But it's impossible to steal the NFT recorded on the blockchain that proves rightful ownership of that image. This means there is no resale value for a stolen image. Moreover, the perpetrator has no usage rights.

AI-powered apps like Pixsy.com, which helps find online image theft, can further protect the rights of artists and NFT owners. Ultimately, as NFTs become more mainstream, social pressure will discourage those who steal images and encourage everyone to acquire their digital assets properly.

Also, what makes NFT different, in addition to owning the art itself, is that they are often tied to projects that include other utilities for their NFT owners.

For example, some NFTs are being used as content inside a game (known as "in-game" assets). In some cases, buyers can stake an NFT in exchange for an associated cryptocurrency. The Bored Ape Yacht Club has even organized real-world meetups for its members. Community building and social status symbols certainly play a role in the new NFT culture.

Real estate photography and NFTs: Who owns the photos?

There are several challenges in the real estate photography industry that NFTs can help solve. Let's explore it further.

Ownership of photos in real estate has been a burning question for a while now. A few years back, Zillow was sued for $81 million by a real estate photographer for using real estate images without authorization. Recently, Zillow was ordered to pay nearly $2 million because of a copyright infringement case involving real estate photography. Similarly, other court rulings say photographers own the copyrights for their artwork and only provide usage rights to the listing agents.

As a result, lawyers are now asking photographers to sign contracts forfeiting their rights to the photos. NFTs can help resolve this issue by providing a clear transfer of photograph ownership. But lawyers do not need to get involved.

By using NFTs, real estate photographers can deliberately and transparently deliver digital usage rights to their customers without the need for any legal contracts. Buyers will then use the image exclusively for their marketing without legal or licensing issues.

A secondary market emerges

Another issue faced by real estate photographers is having no passive or recurring income stream. If you are a photographer working in the real estate industry, you will only get a one-time payment for a photoshoot, and that is it.

However, NFTs provide a perfect solution to this problem. Real estate photographers can monetize their portfolios and create a passive income stream by receiving royalties when their images are sold to new buyers.

There is no limit on how many times you can sell an NFT. Photographers will solely decide the amount of royalty (1-10%) when creating an NFT, and then a smart contract will execute the instructions automatically.

Think of a business owner who needs an image of downtown Chicago for a new marketing campaign. They can purchase an NFT, use the image for a specific period, and then resell it to another buyer after their marketing campaign is complete. In this example, the photographer would get paid for the original sale. The photographer also would receive a royalty of up to 10 percent of the second sale.

Recurring revenue is a new pathway for real estate photographers to access the pool of wealth locked in their digital assets. Now, photographers can get paid every time someone sells their images.

What are the best images to sell as NFTs?

The best photos to sell as NFTs are expected to be destinations in the public domain, such as historical landmarks, streetscapes, downtown areas, commercial hot spots, parks, and beaches.

Ask yourself this question: If someone lives in a city or a town and can own one single image that best describes where they live, what image would that be?

In the existing model, these types of images would typically get sold by large, centralized corporations (e.g., Shutterstock, Getty Images) in the form of "stock images." The problem is stock images are not unique in any way. The same image is sold repeatedly to many different people. The money earned from these sales most often goes to the corporation, and the photographer does not receive any income after the initial shoot.

NFTs provide an alternative to stock images since each is unique and sold to one buyer. If the NFT is resold, royalties flow back to the original photographer. The old, legacy stock image model can change to become a completely decentralized "Web3" solution powered by NFTs with all financial benefits going back to the photographers.

Next step: Selling NFTs of real estate photos

Real estate photographers we work with have told us they are highly interested in converting photos into NFTs. But they need help. That's why we have an effort underway at HomeJab to help real estate photographers create and sell NFTs.

We even believe consumers will be interested in hiring photographers to shoot a specific location as an NFT. We want to assist in filling this need as well.

If you are interested in NFTs for real estate photographers, drop us a line at [email protected], and we will keep you posted on the work we are doing with NFTs.

Joe Jesuele is the founder and CEO of HomeJab, America's most popular and reliable on-demand professional real estate photography and video marketplace for real estate pros, delivering over 4,000,000 images to help agents sell and rent more than $35 billion in listings.