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9 Examples Of Digital Real Estate Passive Income: Do They Still Work In 2022?

November 23, 2022

Digital real estate might be the ticket to a passive income. By leveraging the power of the internet, you can invest in an online business and create a steady cash flow. But how much does it cost? What are the pros and cons of digital real estate? And what are examples of digital real estate?

In this article, we take a closer look at how much capital you need to invest. Plus, how you can make money with digital real estate. We'll also cover topics like if digital real estate is worth it. And why local lead generation is the best way to secure a passive income in 2022

What Is Digital Real Estate?

Digital real estate is a property on the internet. An asset that belongs to you that you can sell or rent to make money. But you need to own your digital property. And it needs to offer value—a reason why people want to go there. Digital real estate is a low-risk and low-cost investment opportunity. And one of the best online business options in 2022

But if you want to generate a steady cash flow or create a passive income with your digital real estate, you need to be prepared to do the work. The goal is to get to the top of Google search engines. Then you own prime real estate. And that's where you'll find the money.

What Are The Pros & Cons Of Investing In Digital Real Estate?

Of course, like any business model, there are advantages and disadvantages to digital real estate investing. A few of the most common pros and cons include things like:

Pros

Low-risk and low-cost investment opportunity that can generate high-profit margins

Fast appreciation and easy to improve

A forward-thinking approach to investing that can create a steady cash flow

Cons

High volatility and an unpredictable market

Risk of cyber attacks, hacking or online threats

Minimal regulation within the online market

How Do You Make Money With Digital Real Estate?

To make money with digital real estate, you need to own something that has value. An online asset that drives traffic and sits front and center for a specific target audience. With only so much room at the top of the SERPs. If your digital property is at the head of the pack, you own prime real estate. But you need to hone in on your preferred business model. Consider things like:

Things To Consider Before Investing In Digital Real Estate 

  • Do you want a shorter-term commitment, like flipping domains?
  • Does being a digital landlord and starting a lead gen business appeal to you?

  • Would you prefer to build an online audience over time and monetize a specific channel like affiliate marketers?

  • Are you interested in tech creation? Or do you have an idea for a mobile app?

You can pick one or a combination of several—for example, social media platforms. And you can sell ad space plus promote affiliate offers with YouTube or Facebook.

But if you want to make money with your digital real estate, you need traffic. And online traffic doesn't come for free. So you need to invest the time and effort if you want results. 

Our 9 Top Examples Of Digital Real Estate Passive Income Investment Options 

Digital real estate is a way to make money online. And there are numerous passive income ideas and ways to invest. For example, you can buy land in the Metaverse, Bitcoin, or flip domains. But developing valuable digital real estate takes time.

And a passive income isn't easy money. It takes hard work, consistent effort, and investing in the right assets. Plus, not all online properties are worth it. So you need to do your research. Then you can decide what type of virtual land is best for your specific skill set and long-term goals. For example:

What Digital Asset Is The Right Choice For You?

  • Do you enjoy creating content? Or prefer videos?

  • Are you tech-savvy? Or an expert on a particular subject?

  • Do you prefer social media? Or would you rather engage in a private group?

We've done some sleuthing and developed a list of the 9 best digital real estate options to generate a passive income in 2022. So let's check it out:

1. Lead Generation 

First on our list and our number one recommendation is local lead generation. Building and ranking websites that you own. Get to the top of the SERPs, and your digital property brings in leads.

You then sell those leads to small business owners for profit. With lead generation, you own the website, call tracking number, and leads. And the business model requires minimal startup costs and time commitment. But once your site is ranked, it's pretty hands-off. Plus, because you can build sites simultaneously, you scale quicker. So you can start making money faster. 

Business Model

Websites

Investment Costs

$15 per month in tracking phone numbers with software like CallRail
$8 per month in hosting on platforms like Namecheap
$10-$20 per year for your domain through sites like GoDaddy
$500 to rank

Potential Earnings

$500-$2000+/month per lead gen property

Benefits

With lead generation, there's no ceiling on income potential or cap on how many sites you can build. And with over 41,683 ZIP codes in the USA, each represents a target market. Once you understand the process, you can build and rank multiple sites at a time. Plus, the focus is at the local level, which is way easier to rank than at a global scale. (So you rank faster). And because you need to interact with business owners (at least at some level). People from foreign countries are dissuaded from saturating the market. Lead gen is also a skillset.
And it does take time to learn and understand the concepts. But these skills raise the bar on the barrier to entry. So the business model is less competitive than other digital real estate investment opportunities.

Challenges

Certain niches are more competitive and harder to rank even at the local level. Also, connecting with the right business owner can be a challenge. And you do need to communicate with business owners. (At least while your site is in the process of ranking), which doesn't appeal to everyone interested in a passive income. And you need to have solid sales or negotiation skills to get the best bang for your buck. But because you own the site, number, and leads, even if you get a business owner who decides to bail. You can go to their competitor and sell your leads without missing a beat.

Duration

Location and competition will determine how long it takes to get your lead gen site to the top of the SERPs. But the average time is six weeks to six months.

Scalability

Local lead generation is a low-cost investment opportunity. So you can scale quickly with minimal risk or upfront capital.

Like this lead gen site below that I built in 2014. It took me around 10 hours to develop. And an initial investment of about $500 to rank. But it's been making me $2000/month for the last seven years.

Tree Care Lead Gen Site

There's no limit to how many sites you build and rank (I own over 80). Plus, you can build anywhere in the world. Connect with a company that wants to scale, and you have a steady cash flow every month. 

2. Affiliate Site

Affiliate marketing is a chance to own an online business. One that doesn't need any products or deal with customer service issues. But before you consider how to start an affiliate marketing business, you need to understand that to be successful; you need a steady stream of online traffic. And traffic is hard to get. (Plus, it's not coming for free). You don't own the product you're promoting. So you can't cash in on recurring sales.

And you must constantly create new content or promote an offer people can't refuse. In addition, as an affiliate marketer, you compete against others for the same target audience. So you need a marketing strategy. And a clear path on how you plan to drive online traffic to your offers. For example:

  • Do you have the time it takes to build a website and develop a trusted audience?
  • Do you have the budget for paid advertising? 
  • What kind of content creation do you enjoy doing?

Your goal is to get a steady stream of eyeballs on your affiliate offers. But you need to know where your digital people are hanging out. And what platform is the best fit for your target audience. Then, connect with high-paying offers with affiliate programs. Like ClickBank or ShareASale to create a passive income.

Business Model

Niche blogs, landing pages, sales funnels, social media platforms

Investment Costs

Costs will depend on your chosen method of delivery. But you have options like niche blogs on websites (domain and hosting will cost around $200/year. Or you can buy existing sites like Flippa and Empire Flippers). 
Sales funnels for $100/month from sites like GetResponse or LeadPages. 
Landing pages on Unbounce for $90/month. 
You can also build a social media or YouTube channel (for free) or buy a monetized option on PlayerUp.

Potential Earnings

By 2022, affiliate marketing spending in the US could reach $8.2 million. And super affiliates make $3000+/day in passive income with the business model. But the average earner should plan on 3%-10% per click or $5-$300/day.

Benefits

Low cost and minimal risk. Plus, the business model is simple (albeit time-consuming initially) to execute.

Challenges

One of the drawbacks of affiliate marketing is your lack of control over the customer experience. Plus, there are no recurring sales because the customer belongs to the affiliate parent. But the biggest challenge is competition. Because as an affiliate, you're operating at a global level. So you're up against sites from all over the world. And often you're competing with people who have a lot of money. Or a brand that has invested years in getting to the top of the SERPs. And everyone is vying for the same online traffic. So you need to be a better marketer. Or have a bigger budget and an irresistible offer if you want to make sales.

Duration

Building an online audience can take anywhere from 6 weeks to 18 months. But it will depend on your platform and the amount of quality content you publish. Plus, you need to actively engage your audience and build trust. (Which takes time). Paid ads are a way to grab a quick sale. But paid advertising is expensive. So make sure you factor in costs versus profits. And don't end up out of pocket. 

Scalability

Unlimited growth potential. Plus, you can promote as many offers as you like on more than one platform.

With this business model, the barrier to entry is low, and anyone can join an affiliate program. So if you want to make sales, you need to create a better offer. Or you need to be willing to spend more money on paid ads. But this market saturation can drive affiliates to employ some of the darkest sales tactics on the internet. So you lose the trust of your audience. Plus, you need to constantly be on the hunt for the next great offer to promote.

On the other hand, the lead gen business model focuses on a local market. And because the focus is on generating local traffic, it's easier to rank. Plus, lead gen has a human element. And part of the business model is interacting with business owners. So this natural barrier to entry prevents people from other countries from flooding the market. 

3. Domains

You need a strategy if you want to create passive income flipping domains. The key is to find domains as cheaply as possible (free is even better and can be found on sites like Hostinger). Look for domains listed for sale on platforms like Sedo and Flippa and concentrate on URLs that have a few fundamental characteristics like:

  • Short & Brandable (2-3 words, easy to remember, and includes a city name)
  • Search Friendly & Authoritative (use Keyword Planner or ahrefs to determine search volume)Not putting enough interests
  • Clean Backlink Profile (use tools like SEMRush or DomCop)

  • Popular Extension (com, io, etc.)

Business Model

Domains & URLs

Investment Costs

You can purchase domains for as little as $10/year on sites like BlueHost and NameJet.

Potential Earnings

You can earn anywhere between a few hundred dollars to millions. The most expensive domain name ever sold went for $872 million (cars.com). But be sure to use an escrow service to avoid stealing or domain fraud. 

Benefits

Easy to start with low barriers to entry. You don't need a ton of upfront capital. Plus, the level of competition is much lower than many other online business models. And when you become skilled at identifying what kind of domains to purchase and how to find the ideal buyer, you can maximize every sale to its full potential. 

Challenges

Good domains are getting harder to find. But the internet is growing. So there's still an opportunity if you can find a gap in the market or focus on micro niches domain names. Of course, you need to beware of fraud and scams. And be sure to use a third-party tool like Spamzilla before you buy to check the history and backlink profile.

Duration

It can take as little as a month to ten years to connect with the ideal buyer and sell your domain for a decent profit. The key to domain flipping is patience. And know the best way to monetize and increase its value to secure big payouts. 

Scalability

You can buy as many domains as you want and can quickly scale your business. Become an expert at trend data with software like domainers.co to stay one step ahead of the curve. And you can generate a passive income stream with this digital real estate example. 

But what do you do with your domains after you purchase them? You can do nothing and try to find a buyer. Or you can invest some time creating a niche website. Of course, you need savvy sales skills.

But once you find a buyer, you can negotiate the best price. And you can list your domain on auction sites like Namecheap. Or connect with a domain broker on platforms like GoDaddy and let them do the heavy lifting. 

4. Digital Products

Digital products can be extremely lucrative. You can sell your own products and digital assets to create a passive income. But you need to sell something that solves a problem, educates, entertains, or fills a gap in the market. 

Business Model

Online courses, eBooks, webinars, audiobooks, fonts, downloads, etc.

Investment Costs

The business model requires minimal capital. But you'll need to invest your time to create your product. You can then sell your digital product on sites like Shopify or Sellfy or build and rank a website you own for $15-$100+/month.

Potential Earnings

Price point will depend on your product (single products average $100-$165) and can range from $20-$5000/product.

Benefits

Once your product is complete, you can sell it over and over (it can be automated with software like FastSpring of SendOwl or utilize a VA for updates).

Challenges

You're competing against a ton of free content. Plus, it can take time to build an audience or create a buzz around your product.  

Duration

You can create a digital product in around six weeks to 12 months (the more detailed-the longer it takes).

Scalability

To scale, you'll need to add upsells or consider things like a paid newsletter, subscription, etc.

The beauty of digital products is that once you can create them. You can sell them repeatedly but to a new audience. So you don't need to update or create unique content constantly. But it's a competitive market. So to make money with your product, you need to stand out from the competition. Consider things like:

  • Can your product improve someone's life?
  • What are people looking for? 
  • Are you an expert on a specific topic?
  • What kind of content do you enjoy? (written, video, audio, etc.)
  • What can you share that isn't being sold elsewhere?

Focus on delivering value and building trust with your target audience. And you can earn a passive income. 

5. Mobile Apps

Mobile apps can generate a steady cash flow if you can develop one that has a purpose or plays a pivotal role in the life of a business or person. The key is to create an app people want to use. So you need to consider things like: 

  • Does your app solve a problem?
  • How will you monetize it?
  • How can it generate a passive income?
  • Will your app be valuable to a specific demographic?

Become an established brand, and deliver an app that meets your target market's functionality and expectations.

Business Model

Apps

Investment Costs

You can develop for little to no upfront capital on platforms like App Builder and Apphive. However, if you don't have the technical expertise and need to outsource your idea, you should plan on a budget of $5000-$25,000+.

Potential Earnings

You can monetize your app in multiple ways. And if you can develop an app with a high perceived value, you can sell your app for a lot of money.

Benefits

Once your app is finalized, you have options from selling to monetizing and can secure high ROIs if it can deliver. 

Challenges

The market is super competitive. (As of July 2022, there are over 2.65 million apps in the Google Play Store). So if you can't find a buyer for your app or a way to monetize it, you won't make any money.

Duration

It can take 7-12+ months to develop, test, and launch an app before you have the finished product.

Scalability

It's challenging to scale a mobile app. But you can continue to improve upon it. And you can always add active users to generate additional cash flow. 

You have a few options when it comes to monetizing your app. You can either sell it for profit. Or you can implement bankable strategies like:

  • In-App Advertising (AdMob)
  • Purchases & Freemium Model
  • Subscriptions & Sponsorship (RevenueCat)
  • Crowdfunding & Affiliate Links

But if people like what's on offer. Then you can make some real money with mobile apps. 

6. Monetized Social Media Platforms

Social media is a way to harness passive income. It offers free organic reach if you know how to leverage your platform of choice. But you need to know how to build awareness. What strategies will you use to monetize your social media account or YouTube channel? How can you generate a steady cash flow without being salesy? 

Business Model

YouTube, Facebook, TikTok, Snapchat, etc.

Investment Costs

You can start a channel or page on any social media platform for free. However, there are options to buy existing sites. Social media accounts or YouTube channels that have been monetized for a particular audience. You can purchase existing digital real estate assets on platforms like UseViral or FameSwap for $100-$1000+.

Potential Earnings

If you monetize your channel or social media account with banner ads, affiliate links, sponsorships, etc., you can make $1000/month or as much as $1M/post.

Benefits

Because you can develop an online following for free, so the barrier to entry is low. But you need to produce content. And it takes time to build trust with an audience. However, you don't need a ton of followers to start making money

Challenges

People need to want to do business with you. So you need to present as credible and bring value. And that can take time-a long time. Plus, the market is uber-competitive. So you need a unique angle and a clear reason people want to visit your platform.

Duration

It can take 4 months and 10 years to cultivate a solid following on a social media platform or YouTube channel. So you need to be prepared to publish regular content that people want to consume.

Scalability

The sky is the limit when it comes to how big you can scale your following. But if you invest the time and effort. And consistently produce valuable content. Consider how do you make your digital real estate valuable. What articles or posts can you produce to make people aware and build your brand? If you can build a brand, there's no ceiling on the growth potential of your digital real estate asset. 

Don't spam your audience. Instead, provide value. And create content for a market that feels overlooked or mistrusted. But, again, it's about building a brand. And that takes time and effort.

Maybe you need to give away free stuff. Or consider running a contest to boost engagement. But the end goal is to build a digital real estate asset that pays you. You can capitalize on your digital land with things like:

  • Paid Advertising & Influencer Marketing 
  • Sell Merch & Promote Affiliate Products

  • Partnerships & Sponsored Content

Building your online brand takes time. But if you get it right, the potential payout is massive. 

7. Email Lists

Email lists are a way to grow an audience. Then you can either sell your list to a blogger, business owner, or brand that offers products that cater to your target audience. Or you can sell your own products, promote affiliate offers or use them in conjunction with growing your personal brand. 

Business Model

Emails, funnels, landing pages, blog sites, social media accounts, etc.

Investment Costs

You can build an email list for minimal costs with software like LeadPages and MailMunch for $13-$37/month. Or leverage WordPress plugins like Constant Contact Forms. 

Potential Earnings

You won't make much money if you sell your email list outright. But if you grow your list, you can generate up to $42 for every $1 spent (that's a 42x ROI)

Benefits

Low-cost virtual real estate investment to build engagement, generate more sales, and share value with your target audience

Challenges

It’s a competitive court, so you need to be strategic with the emails you send to create a sense of community. For your email list to become one of the worthwhile passive income ideas, you need to offer value-centered content. (Which can take time). And a way to stand out from the crowd with an offer that invokes a purchase.

Duration

Plan on investing 3-6 months initially. But to grow an email list of any significant size can take up to 12 months or longer. 

Scalability

You can continue to grow your email list with things like giveaways, bonuses, etc.

You can use marketing techniques like sales funnels, tripwires, or landing pages with software like SendOwl or MailChimp. The goal is to get people to give you their emails. So not only do you grow your list. You can then monetize that email list to generate a steady cash flow.

But you want your email to get opened and not go to their spam folder. So you need a compelling headline and a pitch with an irresistible offer: value and a reason for people to pick you. And not the competition. 

8. eCommerce Stores

An ecommerce store is one of the top digital real estate investment options on our list. Not only has online shopping become the new norm. But predictions suggest a global market of $5.4 trillion in 2026. So not only is there opportunity. But if you play the game right. You can make a significant amount of money.

Business Model

Websites

Investment Costs

Plan on an initial investment of $100 up to $50, 000+ to launch your eCommerce store. (More if you need to source and purchase inventory). 

Potential Earnings

The average eCommerce store earns $30,000-$127,000+ revenue monthly. But you need a product people want to buy and know how to leverage tools to drive traffic to your store. 

Benefits

eCommerce costs less to start than brick-and-mortar stores. Plus, you don't need the same licensure and permits. Plus, you don't have to pay rent or worry about paying for hydro, heat, etc. There's also no limit to your reach. And you provide greater flexibility for your customers.  

Challenges

You don't have much control over the customer experience. Plus, there is often a high level of returns and refunds. There can also be issues with the quality of your traffic. So you need to know how to leverage sales channels. And how to be visible if you want to generate a stream of purchase-ready consumers. 

Duration

Plan on spending 18-24 months on getting your online business up and running to profitability. You need to invest in the effort it takes to develop a valuable digital asset. You also need to decide how will you drive online traffic to your real estate property. And the best way to fine-tune your automation systems is to build your brand.

Scalability

You can test the market using the dropshipping business model. Find a winning product, build your brand, and scale your business by adding complementing products, upsells, etc. 

eCommerce can make you a steady cash flow. But to generate a passive income with the business model, you need to automate. Owning a passive rather than active online store takes systems. So you need software.

There are, however, businesses that provide a DFY automated business, such as the model provided by Blueriver Ecommerce. However, these require a large investment and come with their fair amount of uncertainty as well. 

Tools that are designed to do the work at the back end. (Like Active Campaign and Shopify Flow). eCommerce takes a ton of work at the beginning. But if you can attract a flood of buyers on autopilot. And have the right systems in place, you can make a passive income.

9. Membership & Subscription Groups

Subscription businesses and membership sites are two digital real estate investment options that generate recurring income. In fact, the data suggests that the subscription economy will be worth $1.5 trillion by 2025. From snacks to digital downloads, if you have an idea for a subscription. Or you can offer value with a membership. You will make money if you own these digital assets. 

Business Model

Websites, sales funnels, landing pages, email marketing

Investment Costs

You should have a budget of $250-$5000+ for your first year to cover the costs of hosting, plugins, themes, marketing, and payment gateways. 

Potential Earnings

There's no ceiling to your income potential with subscription or membership sites. The key is to get people to join. So you need to be in touch with your target market and offer a service or product that meets a need, solves a problem, or can improve their life. 

Benefits

This type of digital asset is a way to generate recurring revenue. People pay a monthly fee for their subscription or membership on autopay, creating passive income. 

Challenges

Your most significant challenge is attrition (most people leave membership or subscription sites after about three months). The key is to have an end date. Then, for example, charge more money for a shorter time frame. So not only do you not have to keep creating new content or a new product. But you should improve your client retention rate.  

Duration

It can take several months to years to grow your online business. And the goal is to continue to bring new members to your site. But you can automate the process with software like Chargebee or Billsby.

Scalability

If you automate your systems and can bring in a steady flow of new members, there's no limit to how big you can grow your digital asset. 

You can offer anything you want with subscriptions and membership sites. But you need to be visible. And create a buzz around what you're trying to sell. Plus, there has to be a clear reason why people should come and stay for the long haul. So you need a marketing strategy that should include things like:

  • Free Trials & Freemium Offers

  • Content Creation & Influencer Marketing Campaigns

  • Brand Awareness & Scaled Pricing

You need to create a seamless customer experience. Be different (and better) than the competition. And you can secure a recurring income with your virtual asset.

Is Digital Real Estate Worth It? 

Yes, digital real estate is worth it if you're working a 9 to 5 and have no other income streams. Trust me. I was in your shoes. And any residual income you can create is better than nothing. But you must make time for yourself and commit to learning a new skill set. So I would say at least 10-20 hours of focus per month of commitment for the next three months. This is especially true with business models like local lead generation, where you can invest $500 on a digital property that can make you $500 to $2000 net per month.

And those ROIs make it much more worth it than physical real estate. (Especially when you're tight on funds). But compare that to buying a single-family home that requires a $50K+ down payment and might need to take a loan from the banks that you have to pay back with interest. And if you're lucky, you might net $800 to $1000 per month. Plus, you still have to deal with tenants and home repairs.

But technology is constantly evolving. And the best way to build an asset that can create a passive income is by leveraging the power of the internet. So you need to decide which digital real estate venture is the best choice for you with options like:

  • Rank and rent websites 
  • Promote affiliate offers
  • Metaverse land investments

But it doesn't matter what business model you choose if you can create value. If you own a valuable digital asset. Then you can secure a passive income in 2022.

Can Digital Assets Create A Passive Income?

Digital real estate can create a passive income. But it's not a get-rich-quick scheme, and it's not easy money. To make a passive income, you need to be prepared to do the work upfront. It takes time and effort to cultivate an online asset. So you need to be ready to do the work to develop a virtual property that has value or appeals to a specific audience. And you need a strategy that includes evergreen content, solves a problem, or meets a demand in the market.

But once you have an online entity at the top of the SERPs, it becomes a virtual real estate that is valuable. Plus, your investment will only appreciate over time. And can generate mailbox money every month. Like the lead gen business model, you act like a landlord who owns rental property. And you earn steady cash for your leads. Of course, it takes time to build and rank websites. But once they're at the top of Google and generating calls. Your lead gen properties don't need much hands-on work. And that's how you create a passive income with your digital real estate. 

Why Lead Generation Is Our Number One Digital Real Estate Investment Recommendation

Lead generation is our number one recommendation if you want to create a passive income with digital real estate. With local lead gen, you have complete control over every aspect of your business. And because you have the skills to get your lead gen sites to the top of Google, you own value.

The sites, call number, and leads belong to you. Connect with a business owner who wants to grow their online presence and rent your digital land to create a rental income. Then, you can create a steady stream of cash coming in every month. 

Like I did with this site above, that continues to bring me a check every month. We have over 7000 students in our lead gen program—people who have adopted and implemented the concept. And now they have more control over their financial freedom. Of course, you need to be willing to do the work at the beginning. But if you invest in the business model. You hold the reigns to a passive income stream. 

Conclusion

Investing in digital real estate is a way to make money online. But it's also a chance to control every aspect of your business. Passive income isn't about getting something for nothing. It takes grind and hustle. Of course, you need a proven concept like lead generation. But when you own prime real estate, people are happy to pay for a piece of the action.

You need to decide what digital real estate investment best aligns with your interests, skills, and long-term goals. Then dig in, do the hard work, and establish a trusted online entity. One that has authority and leads with value. But if you do it right. You can create a passive income with digital real estate. 

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Ippei Kanehara
Founder/CEO

$52K per month providing lead generation services to small businesses

Ippei.com is for digital hustlers, industry leaders and online business owners.

His #1 online business recommendation in 2022, is to build your own lead generation business.

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