So... the SL land market...

It appears to be like a bloodbath of epic proportions. I am seeing a lot of longtime estate owners selling out, sims of 600USD or less...yellow fever all over the mainland.

Any thoughts?

Well, LL started to sell OpenSpace Sims singly rather than in packs of 4, and upped the prim limit so that an OpenSpace Sim had 1/4 of the prims of a full Sim.

Due to this some island owners started to buy openspaces to rent out to those who wanted a low prim island. A demand for such rentals grew- why pay for 1/4 of a private or mainland sim when for about the same price you could get a whole sim with the same number of prims.

More estate owners jumped of the bandwagon buying up openspaces to rent out but the market began to be over-saturated. An unoccupied openspace is a pretty big hole in a landlords finances. So some landlords started renting out the openspaces below cost just to limit the loss - now people could rent a whole low prim sim for less than it would cost to rent a 1/4 sim with the same prim limits - thus undermining the normal mainland and private estates.

P.S. most of the above is speculation, btw (albeit informed speculation)

Matthew

The irresponsible selling of openspaces hasn't helped and the fact that everyone is turning a blind eye to their intended use.

However generally, it's the summer, allegedly in the UK because it's done nothing but rain, but technically it's the summer, the real test of the market will come in the Autumn.

LL is headed for a "Get the land pretty much for free, pay for the service monthly" model. More discussion of the same topic:

http://www.sluniverse.com/php/vb/business-land-economy/14069-land-business-dead.html

When I went 'Premium' in Oct 2006, a month after I came here, I think the cheapest 16m plots were around L$350-L$400. Prices went up and up and I remember when L$16,000 was about the going rate for a 512m plot. Then came the great land crash and land lost two thirds of its value in a day. Exciting times. Just imagine if that ever happened in RL. Actually, the way things are going, it probably will (runs away and hides)

The slu thread is interesting: a bunch of barons say how they're all doing just fine, tyvm. Both Mainland and Estate, it seems. If I read the posts correctly, the common denominator seems to be that their business models are based on growth of land under management, not flipping. (That would make sense because new growth could benefit from lower land prices.)

I don't follow Estates at all--I've never understood anything about them--but it seems the bottom of the Mainland market was a few weeks ago--sometime after Jack's announcement freezing sim auctions. I guess it's not surprising there should be some lag there, given that sims at the last auctions weren't selling anyway.

Supposedly, the total amount of Mainland for sale has been decreasing slowly since then, and from what I see it seems to be true. There's still a vast amount of yellow on the map, but it does appear slightly less than before. (I'm not sure it means anything, but the amount of purple seems much reduced.)

And supposedly prices are edging up again, slowly, according to whatever average LL tracks.

It would seem that, for now, the tide has turned, if only just perceptibly.

Mainland pricing isn't heading up.

Estates have been battered by openspaces but when the inevitable openspace crash arrives people will go back to estates.

The question is whether estate landlords hold their nerve.

I would dearly love to see an example of this. If anyone here has such a deal to offer me, please feel free to PM me here or IM me inworld.

You can find it several forums south of here in the land and property sales. I just don't understand why so many people wanted to Ho up the market on openspaces by selling them so cheap. I don't know why you would want the financial liability of so many islands that only return you a few pennies - some will take much longer than a year just to break even - that is not a sound financial plan. Looks very much like the US housing market - The open spaces sim market will crash too. I am already seeing people bail on them - it will get worse.

Not everyone with $250 has the business sense of a flea. Thats why so many people decided to sell the openspaces so cheaply.

I totally agree. Unfortunately all estate owners receive a black eye when a resident loses out. I think the worst is yet to come with these sims.

1. It's a market shakeout. Anyone who is thinly capitalised or not ready is going to be in trouble.

2. It had to happen. Sustained high costs would have caused a cataclysmic crash the moment any low budget competition came along. It's not over yet, either.

3. Perhaps we'll see some fairer winds this fall.

4. I had a choice over the last two years - grow explosively into a massive estate far larger than I have, or run a tight ship. It's really paid off in times like these. Fortress Caledon remains ridiculously strong, with all regions paid off and in black ink.

5. This may be taken the wrong way by some - but I'm in business, and have to think like a businessman for the good of the estate and everyone in it. As such, in a bargain market I'm adding four more regions, which will be delivered in less than two weeks. After two and a half years I may actually outrun my waiting list with this move. But as other estates close, demand picks up. And so it will be also for the other survivors.

Not by me =)

The day I decide to abandon the mainland, if ever, then I like everyone who has left already will be looking for a home in a region managed by someone who knows what they're doing.


I don't think four is going to be enough actually =)

Most of the barons in trouble are those who just offer vanilla land with nothing unique or value-added. They sell just land, and it is only natural that when another opportunity for more controllable/affordable "just land" comes about, customers jump on that. Good riddance I say; the less middlemen in the land game, the better.

Compounding the problem is that some people who own islands will purchase openspaces for friends and "rent" them at cost. Since the reduction on prices, I've ordered five openspaces for friends.

In the one mainland sim where I live the prices are all over the place. I purchased 3 parcels ranging in price from 6-8 L sqm. (This is a water sim bordering Linden protected oceans.) Another is available for 10L sqm. In the last few days, the person who owns the land behind me has a rather large plot up for sale for 18L sqm!!! (One of the people in that group also purchased Bay City land and is trying to flip it. The plot with the "rainy weather."

It is really amazing to see plots of land right next to each other selling for such disparate prices. Of course nothing says anyone is going to buy the 18L sqm plot right away either.

Right, but this is all over the grid. In a couple of sims where I own land, there are reasonably-sized parcels for sale at L$15-25/sq.m., and have been that way while all around them parcels were (actually) selling for L$5/sq.m. or less, and now for about L$8. I suppose the thinking is that eventually all the cheaper land will sell out and somebody in the sim will just desperately need to expand for prims or something, and buy at any absurd price. I don't think it's quite the same as the microparcel extortion parasites whose only hope of ever selling is the simple aggravation their tiny parcel causes the adjacent landowner. (I mean, it's not like anybody is ever going to pay L$9999 for 3 prims, roadside or not.)

There is one of these parcels, though, that's an interesting twist on the old adfarm extortion scam. It's a 512 that was for sale as the prices slumped a few months ago, bought by that fungus who ran one of the "banks" and now one of the lesser ad networks. The twist was that he plunked down a BiaB shop there. Now, this particular sim is mixed-use, with mostly modest residential and some specialized retail, so it was a fair bet that the neighbors would be offended by a BiaB setting up shop there--with a hefty pricetag set on the land, in case somebody was inclined to "clean up the neighborhood" at that price. It was clearly extortion--the traffic for the BiaB parcel is vanishingly close to zero--but is disqualified from the adfarm extortion ban by size, content, and (barely) price per sq.m. It's been there at least six months now, so he's paid a fair bit of tier on it (unless he's scamming tier, too).

Come to think of it, the same fungus has a parcel for sale in that other sim, with a different adfarm twist. He's selling a 208sq.m. for L$5000 that would effectively block his manga-porn-laden ad network eyesore.

i assume you manage both residential and commercial. i've been to your region on occasion, but have no idea the vastness of it, or content of it beyond a very small section.

as a commercial user, i would be interested in speaking with you sometime about my options, and your themes.

without teaching cheaters new tricks, please explain to me how is that even possible.

Excuse me. It HAS done something other than rain. It's also been bright for about ten minutes now and then, just enough to make you risk going outside only to get rained on. Let's get facts straight about an English summer huh

I personally rather wish I didn't have any land at all right now, I wish I'd not kept my money in ... might never get it back out ... shrugs.

Yes I have often wondered how this gets done, people with seemingly endless teri availability.

Rob Peter to pay Paul

i'm assuming it's related to 'donated tier' in some way. i would LOVE for someone to donate tier to me! i could totally get prim heavy and make a nice place really really welcoming. but alas, it is not so. *sigh*

LOL

as in, pay cc A off with cc B, until cc C makes an offer? rinse and repeat?

They don't shoot you the minute you go negative...

The correction back to 'normal' will never happen. 'Normal' (I'm guessing) was about $L 9/m. However, you can't have a normal in a market where there are no stable parameters. Land in SL can increase on all sides and there are external competitors that will have a completely different pricing approach. The normal market will be set, not by marketing issues, which are completely artificial in SL, other than the number of active avatars, but by fear and distrust. You know avatars that have region owners bailing out, knowing they can't really be followed. No refund, no warning. Just gone.

And once a person has had their land devalued because of arbitrary actions with unexplained intent or lost their deposit on non-LL land because of an owner bailing and LL's only response is 'tough, sounds personal to me', then the prices lose their floor. A person buys a 8K plot, finds the tier too much and then finds they are about to lose real money. No speculator, just someone that maybe wants to change neighborhoods. Thanks for the US$ 100 contribution to LL.

I've owned my share of land, but I will never own another piece of land in SL. Simply won't happen. I'm renting, paying no more for the deposit than I can walk away from. Only LL owns anything in SL. Understand that. You can't take anything that you 'own' with you (Second Inventory will get some of it out - make sure you back it up). Even the money exchange through official channels is rigged to a large degree - a LL favorable in/out rate, with service charges to boot. You lose selling, you lose taking it out, and LL gambles that it won't get out to the newbies on the horizon. We'll see...