Auction Start Prices Much Higher than in world Prices?

and @ Ponsonby Low -
If you put the auction parcel on your watchlist, you can retain details of the winning bid and the auction history, seemingly ad infinitum. Unfortunately, you can't watch the auction progress in this view without having to constantly refresh the screen, but at least it provides you with a record (I kept details of several auctions that have taken place over the last few months until I took them off my watchlist recently).

just this week my fabulous 9000+m of waterland sold for 4.2m to a land baron. i paid twice that for it 2 years ago. i could have got more, but i was in a hurry. they have chunked it up, and trying to flip it - listed at around 7m.

it has been my experience that many of the people that bid on auctions are noobs, fed to the auction pages by the websites front page. you will notice that the 'buy land now' link goes to http://secondlife.com/land/index.php which is an 'auction intro'. ll send people to that page from various links.

Oh gosh wish I knew!

i announced it. and then, i cried.

Oh there was one thread where I asked for a SLurl and never got it. Not sure if that was the same one. Oh well...Just sorry to see it's been flipped.

No, I don't mind (and appreciate the compliment).

(The differences among 'averages', particularly the mean versus the median, is a topic that should be given more attention in high school. They are all too often used to slant results. If we were more aware of the possibilities we'd get bamboozled less often.)

Ah, thanks; I hadn't done that before and will try it.

Note that there had to be at least two other bidders besides you in that auction. If there had been just a 'someone', that someone would have gotten the parcel for L$3.01/m (or whatever--an extra ten Lindens above the L$ price you'd bid). It took two other people to get it up to L$15/m.

And....L$15/m was that parcel's true price. (Since that's what it sold for.)

I know people get upset when bidding occurs close to the auction-close time. But a bid is a bid. If you've bid what you think the land is worth to you, and someone else bids more, then the land is worth more to them than it is to you.

(Captain Obvious strikes again!!! ^_^)

I don't think Jack reports the mean of sold parcel per-meter prices, but the mean of prices per square meter sold, across all parcels. That is to say, a little 1024 in Bay City affects the average just 1/4 as much as a 4096 in Outer SLobovia. Of course, one could also find the *median* price per square meter for all square meters sold, and that would be an interesting number too. (If that was actually the median intended in the post, then I misunderstood.)

Every time someone asks Jack how their "average" is computed, he mentions that some land sales are excluded... at least L$1 sales are omitted, and there's something special about which group sales count that I never understood, and they omit some extreme outliers, too. I think they're intentionally cagey about the metric, in hopes that will discourage folks from trying to manipulate it (although I'm not sure gaming this number would be all that popular anyway, if nobody understands what it means and it doesn't seem to reflect any known reality about the land market).

I still see a LOT of very highly priced land. Seems like some can afford to inflate prices, sit and wait.

Kind of like some are doing in real life, come to think of it (the bank owns way more houses than are on the foreclosure market.)

...and regions that went for US$4000

woo hoo

Geesh. I wonder what they're worth today.

Just this last May, when LL sold off 30 of the full sims that had been purple for so long, there was at least one that sold for over US$3500 and several over US$2000. (I don't have the complete list but did note down several of the selling prices.)

So while prices are lower than they have been, there definitely is still a market for SL land.

I'd love to know which outliers are excluded. As can be seen here, they can have an enormous impact on the mean---though not on the median. Therefore Jack's comment about excluding outliers serves as de facto evidence that LL uses the mean, NOT the median, to report "the average price of land".

To show why (and I'm just posting this for the sake of the discussion, not imagining that I'm telling you something you don't already know! ^_^), here's an example:

Let's say LL claims that during time period X, "the average price of land was L$5.60/sqm." Sounds like a reasonably healthy market, right?

But L$5.60/sqm is what you get if you take the mean of nine parcels that sold for a mere L$2.50/sqm---------nine parcels totaling 14,336sqm! [four 512s, five 1024s, and one 8192m parcel]--------and only one little 1024, let's say in Bay City, that sold for L50,176 (L$49.00/sqm.)

The mean is the sum of the selling prices, L86,016, divided by the sum of the square meters sold, for the ten parcels we're hypothesizing as having been sold during time period X.

The median, by contrast, would be the central number (or mean of the central two numbers) in a list made up of all the meter-prices. In this example, you'd have a list made up of 14,336 "L$2.50/sqm"s (representing the meters in the nine parcels that each sold at a rate of L$2.50/sqm---512 of them for that first 512m parcel, another 512 for the second 512m parcel, and so on) followed by 1,024 "L$49/sqm"s (representing that one Bay City parcel.)

In this list of 15,360 items, you'd take the middle two, add them, and divide by two (the mean of the central two items, since our list had an even number of items.)

Of course that result would be "L$2.50/sqm". We'd say "the average price of land is L$2.50/sqm" and would be just as correct as Jack in saying (hypothetically) that "the average price of land is "L$5.60/sqm."

It's just that we'd be reporting the median price, while he would have been reporting the mean price.

There's no mystery as to why LL would prefer to use the mean---a higher per-meter price implies a stronger demand for their product.

Just to add to what you said:

Auction bidding, for quite a few folks, is an art form. People make bids for all kinds of tactical reasons. Some to find out how serious other bidders are, others to "snipe" and win at the last minute, etc. Even a few to whom it is a serious addiction; they must win everything they bid on.

It's hard to know with whom you are dealing and why they are bidding the way they do, even to those experienced in bidding in auctions. The best that anyone can do is keep it sane and realize that there are more auctions out there to bid on, so there is no "losing out".

This is why, at his office hours, we have been asking Jack to give us access to the raw data so we can do our own statistical analysis. While I am sure LL thinks they have the absolute shiznit statisticians on staff (*cough*), I think third-party auditing of their figures would help immensely in validating/correcting the results, allowing for more accurate analysis of the land market.

I agree. But: is that something that LL is likely to believe to be in their own best interests?

The potential publicizing of an accurate picture of the land market may not seem to them to be a very good idea at all.

Oh, probably not. They are so secretive about many things but, then again, they are also very open about many things.

One thing is for sure, though: if it will take work to give it to us, it will likely not happen. Apparently, they are so understaffed that they can't get the things done that they want to do, let alone what they have said/"promised" they were going to do. Amazing, considering the amount of hiring they have done over the last year or so.

I think the phrase "working harder, not smarter" probably has some application to the situation.

I'm sorry to say I think that's probably correct.

(I can't blame them for not wanting to spend scarce resources to satisfy OUR self-interested desire for accurate information. But as you say, the resources could probably be allocated more effectively than is presently the case.)

Is a region bigger than a sim?

What would the tier be, if so?

A region is a sim.

Or to be precise, the land itself is the region, the sim is the software that it runs on.

Thank you.

Those prices seem high, then. I thought sims were less than $1000 USD?

They start off at auction for US$750, but people bid them up.

Ohh they go on auction? No wonder.

Thanks.