How low will it go?

Have you tried IMing them? Sometimes they just need a little push.

I almost went for my first sim tonight. But they keep dumping, so there's no rush.

Flip that plot - baby needs a new pair of shoes.....

buys at 8.1 per meter

Buying is easy. Finding a buyer right now...not so much.

Errrr,
a) which hand is it you are claiming is being bitten? Seems to me 99% of all residents will be happy for land to be cheaper.
b) Don't know if you noticed but 16s are the cheapest land in the game these days (thanks Umnik!), cutting your parcels is just going to lose you money.

I think you are confusing which hand is which

To be very general, there are three classes of people that make SL what it is. There's the end users who purchase things and services. Then there's the content creators. Finally, there are the land barons like Sarah Nerd and Desmond Shang who create highly value-added environments for renters. Of course there are additional roles, and much blurring between these roles, but for the most part it holds.

The role of mainland sim resellers is being a middleman; they buy in bulk (sims) and resell smaller parcels to end users. Besides ad lot cutters, they are not negative or positive; they are simply a fact of how the economy works, and will always exist nomatter what the price is. Also, there are some land barons who will use bots to grab cheaply sold land. These barons too are a fact of the economy; if there weren't bots, there would be barons manually hitting the search over and over and snapping up the land before the bots take them (this was a major phenomenon before bots.) All the bots do is make it a bit less "fun" and a bit harder for Joe Interweb to get a deal.

So, the middlemen will always exist nomatter what, so they are not "the hand that feeds SL;" the three groups listed above are. If land is cheaper, more people will buy more land. If more users buy more land, then a lot of them will look into buying furniture, prefabs, landscaping supplies, and other things, which will make content creators happy. Additionally, with virtual land more affordable, the attraction and retention of new users will increase.

Finally, if the price of mainland drops low enough, and additional parcel/mainland sim tools introduced, it could encourage sim developers to take a look at mainland sims seriously. Such sims would add value not just to the sim itself, but surrounding sims and even entire continent regions.

To sum it up, LL is doing the right thing; they are willing to take less initial profit on mainland sims in exchange for securing SL's economic future and user base. This will probably do much to offset the effects of casino closures.

Now if they would only make the client run smoothly, get the recent items sorted out, fix voice chat, and add in a next generation of social networking tools.

Yep. I almost did that tonight. Had plans for a tropical paradise mainland sim with sailing and rental properties. But one of the other middlemen nabbed the sim. Oh well...

yea, me too. If prices drop to around $1500 per sim, I may _have_ to snatch me up a sim to do my dream project of an elevated steampunk skytown. Think of something inspired by oil rigs, the micronation of Sealand, and star wars' cloud city. Only steampunk.

Not sure if it would be profitable tho Quite a risk.

still 100's (400?) of new sims/regions waiting to be auctioned (most not even on the map yet) ...just be patient

LOL, that won't stop the barons greed from bidding against each other tooth & nail to get every sim available,
"have....... so many... unsold.... sims...but.....must....keep buying.....can't let residents..... buy direct..... grid map needs..... more yellow.................."

Oh stop with the land barron hate and stereotyping. We aren't all that horrible. And if we got rid of everyone who was or had ever attempted to make a buck in sl, half our world would poof if not more.

I see at least one sim that was won at action on August 3rd, and still has not been transferred to the 'winner'. Maybe the baron isn't big enough to sit on previously won sims that are still unsold.
My understanding is that he can get out of the deal by paying US$100 restocking fee to LL, but that he only gets 2 strikes at this before he 'may lose his bidding status'.

I see sims that have been bought at auction but not yet for resale many days later. Their owners have yet to unload a significant area of the previous sims they won.

Meanwhile the competition is buying sims at 8L/m - and setting up to resell, presumably at a price level intended to move them quickly.

Interesting times

Okay, now I'm starting to get worried. I know I said somewhere that I thought a drop to between L$4 and L$5 /m2 would be a positive for SL, but I'm no longer sure that will be the floor.

There are only so many residents, willing to pay only so much tier in total. The more land they can get for a given purchase price, the more money they can use for tier, but only up to a point. It looks to me like there might already be more land for sale than the sum of tier all buyers are willing to pay, even if the land were free. It's just possible, I think, that some of this land will end up being abandoned to the Gov, with no takers even at L$0.

Are we really at that point yet? Probably not--I guess--but the thing that's getting me worried is that I really don't know how one could determine when we've reached it. As long as the unsold land inventory keeps growing like this, prices are higher than "end market" value... but is there any way to know by how much?

How low will it go? Nobody knows.Fact is that from last february, price have declined from 15l/meter to 8,2 l/meter. And also fact is that they raised the first bid from 1000 to 1250, which means that it can't go lower than 5,2 L/meter. Unless everybody leaves sl.

it's a moment of joy for all residents of sl. Just take some pop corn , watch and enjoy the ride.

As i see it , SL hould have a lot of problems to dump land like that at this moment. When they reached a certain point of land price some time ago, they stopped dumping new land.
It was a point that mainland was a bit over island price (break even point was few months), so mainland was not competing with island business

Now Mainland is becoming (in a while) a cheaper place than islands. (with the tier difference). That might means that they don't care at this very moment for island business owners , as a kind of protection. Since these business owners have a lot more to loose than mainland land dealers (or barron or whatever you call them) and usually I had the sence that Lindens take them into account, I come to conclusion that the problems SL faces are much more serious. Unless they are planning mainland tier increase or island tier decrease by the end of year but still, the current prices make some damage to island owners (except those who bought for 1295+195 tier fee before 15th of last November)

I really have no clue how all these correlate (or not) with gambling ban and/or ginko failure which in my eyes is a bomb in the whole SL.

From a land dealer view, risks are too high, loss at the end is quite posible, but when big price differences occur (rl also) , some opportunities arise. Fact is that from last february, price have declined from 15l/meter to 8,2 l/meter.
From a resident point of view with no land ownership, who just seek to buy a cheap plot of land , this seems as a nice opportunity
From a resident point of view, but who hold some land already (small or big doesn't matter) , they see both a deevaluation of their existing land and at the same time an opportunity to replace it with a new one in a faster or a new sim.
From SL point of view i really have nothing to say. They are the gods and they do whatever they want. I would love to see them trying more for stability though since they interfere in the so-called free economy by controlling the supply.

I would love to say god help SL but i can't since they are the gods, so they don't need blessing.
I hope we don't need too lol.

Land prices have *been* fairly stable for a long while prior to the last 2 weeks or so. LL has proven time and time again that they can maintain market stability through monitoring the release of land- same deal with Lindens. The price of a Linden hasn't changed more than 10L in months (maybe less than 5L). They've clearly got an economist on staff or at least one they can call up on the phone that they actually use.

Which begs the question- if they've maintained market stability for months and even had a very slow but steady increase in the value of land, why are they allowing it to fall? Maintaining the current price would be as simple as halting the release of any new sims into the market until the market has recovered from the casino owner land dumps. But they're not doing that.

why?

It's a good time to make a major adjustment. There's already a unavoidable land dump going on, tied to a policy change that all landowners have seen- giving the barons a bit of warning that prices could be falling anyways. Less than an hour after the gambling announcement we had people asking what it would do to land prices. Add in the financial crumbling of Ginko and the perception of reduced buying power (the money had been gone for a while but they no longer trusted the bank to cough it up when they wanted it) for a fairly large segment of the population and now is a great time to turn the market into a buyers market (Wow, I lost a ton of money... but land is so cheap! I could just buy with what I have left or bring in a*little* bit more....) Basically you're pumping up the purchasing by increasing the appeal of a fairly stable good. LL wins, end buyers win, and land resellers were going to get the crap end of the bargain *anyways* unless LL stabilized land prices artificially after the casinos shut down.

It also shifts the population back into mainland, possibly sparking revitalization efforts (and trust me, mainland needs all the help it can get) and cutting back, slightly, on the market for island resold land- which was basically cutting LL out of the equation anyways. LL would rather have 20 more premium accounts buying into, and working to make prettier, the mainland than 1 concierge account reselling to 20 free accounts on an island that's unconnected to anything. The big developers will get hit, but- again- there was already going to be some market fluctuation with the gambling ban- they're just not correcting for it... and there will still be a market for people who want the covenants, lower lag, and developed land of islands... so they're not putting the larger island chain owners out of business. They're putting SuzieQ the island flipper who has one trashily set up island on a lark into a more difficult position because suddenly mainland is looking a lot nicer than a trashy island with a inexperienced, or worse- terrible, owner. People like Desmond though? Caledon isn't going to be any *less* popular because mainland is cheap- they're buying into an experience.

It was a good time. Prices will fall until LL stops them by shutting off Corsica auctions for a bit.At the current rate I don't see the market hitting bottom just yet so, however attractive if you're an end buyer, give it a few more days until it's been within .1L/m for 3-4 days, then start looking into buying before the market corrects back upwards slightly.

I'd expect that to be somewhere between 6-7L/sqm, but it could be as high as 7.5. It all depends on where LL wants it.

Yes well over half of us here don't want to make money when buying a sim, so would rather not give money to someone else for the right to do so
If half the grid did go poof, half the grid is empty land for sale anyway, would probably not miss the money makers much as we will make fun from whatever is left

It's starting to get ridiculous with 10,000 sims and only 18,000 residents online at times and yet a sim isn't affordable for the average resident.

Since islands are much more regulated, then the "wild west" mainland, a lower price for mainland would be very justified imo.
Also It allows more people to own land (hence more premiums), and other's to expand their current (hence more tier), and thus a significant boom for the economy, in the long run those are the key items where LL wants to earn its money.

One thing to note, there are 17 1/2 hours left in many current auctions and I see a lot of sims still at the base price of $1250 U.S. Was it just a month ago that I saw rather average waterfront sims go for $3500? Yikes, that's a fast deflation. I agree that prices needed to go down a lot to encourage new members to buy land but I think ideally that should have happened more gradually. A price *crash* spooks people and may end up doing harm--but we'll see I guess. I hope the Lindens know what they're doing.

very nice analyis.
On the quoted section only to say that i don't believe that someone who has lost his money like this would respect the land price drop so much. As i read in other threads, seems there are some 100 million lindens missing from ginko. It's not the amount of money, it's the loosing of trust to SL as a whole.
But i am off subject here

The reason I posted earlier , in a light way i should say, is because I believe that lindens do that on purpose. They give us a land market crash. That's why i wrote that i would love to see them trying more on stability. No matter if they were soft the last months in doing that, now they try to crash the market more radically.
If they don't have that purpose, then either they don't know what they are doing (which i doubt), or they have late reactions to the market conditions (they might don't see the first page of search everyday).
If they do that on purpose and so fast, then someone could believe that they are in some kind of problems which i can't identify at the moment, otherwise they could follow a more slow sim release.
The argument that they can't stop releasing land because of price drop is not valid actually, since they release 16 sims every 24 hours or less. They have survived for months with 2-10 sims every day and a more stable market.

Are you suggesting LL might be in some type of financial crunch?

Wait until 1/2 hour left

i think they do it on purpose, but for the sole reason to attract more tier and premiums, i could be wrong but i think there has been 20million+sqm for sale for some months now,also its down to land-bots mostly that the price kept its stability.
the only way for the lindens to get landprices down, is dump another continent, if it doesnt work, i guess they just will drop another one...

*in the long term they earn more money with more clients/tier then with selling sim's

Noway, i didn't mean something like that. if 10000 sims are on grid they make at least 2 million each month just from tier. That's 24 million each year.

I have no clue what might be the problem if any.

He has 7 days and just does not want to incur more tier. He's hoping to offload one of the other ones he took posession of first. It looks from today's list that he will be doing that at a loss.

Be careful what you wish for. Some of the great innovators here do so because they can make a little bit of money or break even.

I agree with most of your excellent post but wanted to address one thing: The mainland won't be revitalized because of all this. Most of the buyers of land are barons, not end users. Barons like M. D-niels who cuts and craps up every sim with 512s and his own 16m spam plots.

The talented developers like Sarah and Desmond who make sims a better place to visit and live are few and far between and already have their hands full. It takes time, energy and talent to make a sim more inviting. It takes only seconds to slice one up. So look for opportunists to come in during the adjustment and further devalue the mainland while trying to make a fast buck.

This is a temporary drop, folks. One week with no sims to auction and we'll be back at 9-9.5. I think there are a few more 16 sims days coming before they stop the barrage, giving the end user looking for a bargain about a 10 day window to grab one, in my opinion. There's also no need to sell your current land for a huge loss if you have the time and the tier to wait.