Land Price drops to below 5L per sq m

It has finally happened, land prices (according to the economics metric) has dipped below 5L per sq m.

http://secondlife.com/whatis/economy_stats.php

Is this good news or bad news?

How low can it go?

I know its been a long time since land has been this cheap, but just to point out....

Summer of 2005 the "Low" end of parcels for sale were going for around L$2.0/sqm. Sometimes even cheaper, but anything under L$2 would get snapped up quick.

On balance, it is good news.

Is that true? I haven't bothered to look at land prices in a while. I'm just getting done developing the last half sim I bought and I need a break!!

It hasn't dropped that far where I've been looking. :-/

Mari
(but I'm picky, and looking around some prime spots of Sansaran mainland)

It's because of the current influx of new sims, and it won't last. It happened the last time LL produced new sims, although the prices were higher than 5L/sqm. I've just sold a perfectly ordinary piece of land at 13.7L/sqm, and some more perfectly ordinary land at 11.7L/sqm 2 days ago.

Not quite true - it is true according to the LL metric on land sales - this will include lots of free transfers bringing down the average. The actual (current) minimum is around 5.6 L per sq m.

It's pretty insignificant, the total cost of ownership isn't vastly reduced.

Of course, but if one is willing to bear that cost, this just makes it easier.

Those metrics always seem to understate reality.

Right now, a search for cheapo 512s gives 4 plots at 5.5/m, 8 at 6/m, and climbs to 6.6 in the first page of 100, then up to 7/m at the end of the next 100.

Prices are all over the place though. I don't think that there is a 'market price' except in the new sims, where the parcels are directly comparable.
Geate is growing apace. Turn you back for a few days and LL have stuck on more columns of sims.


My group was running short of prims in one sim, so we just bought a 4096 for 48,000L$ (11.72/m)
It's a 32x128 narrow beach and water strip with a 32m boundary on a Linden water sim.
Back in February/March, the same sized strips beside it were going for 18.8/m


Buying Protected beachfront just for the prims in another part of the sim. Who would ha thunk?

There's a lot of new land on the part of Gaeta that we're allowed to see.
Low prices might tempt me to use up my tier on a few 32m plots to use as stalls.
I haven't got any such plots at present.

When I've done this in the past, I've bought 16m plots and joined them, stopping them being used by ad farmers while they were in my ownership. I also used to make 64 m mini shop plots in the same way.

i JUST paid L$11m for a 1024 this morning.

the value is according to the location you are seeking. while mainland grassy and granite areas have dropped, waterfront continues to price high, especially near open sim edges.

It's May. The weather is great. Lotsa time for barbeques. People sick of being cooped up all winter in the northern hemisphere. GTA 4 just came out.

Caledon's got a waiting list still, but it's definitely softer - just like it was this time last year. By summer a huge portion of the demographic is hiding inside to escape heat and humidity.

Also you get the college-age demographic coming off of school in late May and June - not as rich as the adults, but they spend WAY more of their money on digital entertainment, percentagewise.

When fall comes we set up for high season, which lasts from about late November to mid February.

I have friends who are ex AOL employees, and they saw similar trends dating back as far as the late 80's.

* * * * *

There's also the 'baby boom' of the Winter 06/07 noobs - they are now starting to become midbies, and though their avatar spending is stabilising, they are now getting very used to the idea of money for virtual 'stuff' online.

Expect the economic groundswell of this population to last at least 5 years, and spawn even more slow growth over the long term.

* * * * *

Foreward-looking statements? To be honest, a lot of this is just 'gut feel' I have from knowing lots of people. Don't bank on it. But after seeing what thousands do with regard to rentals, property, their purchases... I'm personally thinking this is how it's gonna go.

Sure but for your straight residential, tier prices quickly become prohibitive. They probably should have started with different rates for residential and business use, with pay functions disabled on residential parcels to prevent misuse, but that would be a nightmare to implement now and would send the lynch mobs rushing to the governor's mansion.

The Linden metrics are always going to show an average price of around 2L lower than what the average resident is actually going to see because landbots scoop up the majority of cheap land and immediately relist it for a higher price.

There is no point to this tangent, Ciaran. So what if the price drops? Good for people looking to enter the market, and good for people willing to pay more tier. Tier is a whole other subject. For people who have a hard time parting with their cash for virtual land, this is especially good, if they can acquire a piece at a reasonable price, they will put up with the tier of their choosing, which is probably in the $8-25 range.

Does it also include estate land sales? That might explain why it is lower than what we see in mainland search.

It includes direct person to person sales, including sales from a group back to the group owner. Lots of free transfers get counted in the sales figures. I don't think estate land counts, but it wouldn't surprise me.

I'm a consumer, not a land baron. Dropping land prices is great news.

Especially considering the fact that the "purchase" price of land is meaningless. It's not like I get an enforceable covenant or anything like that for the "purchase."

Those numbers include estate land sales many of which are "Pay 100L$ to reserve this plot" and 0L$ sales between friends and groups. For example, last weekend, I borrowed 2000m2 tier from a friend for an hour and transfered all my land owned by Carl Metropolitan into my land holdings group. That showed as 2300m2 going for 0L$.

So the actual numbers are higher.

However land has finally gotten back down to where it was when I joined in July 2005. I expect that LL will try to keep it in this range. They don't seem to see land sellers (at least on the mainland) as adding value to the world, so they are prone to knock the ladder out from under them from time to time.