Advice on new business

I'm thinking about starting a residential rental business. I don't have experience in this type of business at all and was wondering if anyone out there could give me some friendly advice on how to start up and/or do's and dont's about this type of business. Thank you.

Uh, now is a really good time to NOT get involved in land business of any kind.

The land business is in a great deal of flux right now with mainland prices dropping, vacancy rates high, experienced island developers struggling to cope with suddenly devauled holdings, and OpenSpace sims throwing a whole new equation into the mix.

If you're really drawn to this business, try working for a land dealer first, to get experience. You're going to need your wits about you to stay afloat in this particular part of SL.

OK, what follows is a personal perspective, and feel free to IM me inworld for more detail.

1. Work out your financials - what's your break-even point? Don't expect anything more than 60-70% occupancy at any time - and if you hit that consistently you're doing fine. Expect large scale fluctuations in occupancy and make sure you have a tier reserve in hand. I keep 3 months worth, for example. Don't expect to make large sums of lindens either!

2. Are you thinking of a whole sim (mainland or private) or just plots here and there? If the latter, what are the neighbours doing that might impact on your rental's attractiveness?

3. Work to a theme. Try and be different to everyone else - it's the niche you're after. Hopefully if you pick the right one, tenants will come running. But don't expect them to stay. You'll get a LOT of churn.

4. Provide as much as possible by way of landscaping, trees, poseballs, activities etc. Make your land interesting in some way or another, and change these frequently to keep the interest alive.

5. Make sure you or your managers/partners/whatever are on hand as much as possible to provide assistance, answer queries, adapt houses etc etc. There's nothing like personal service to help your business on.

6. How are you going to advertise? Don't forget there's a LOT of competition out there - how will your business stand out from the rest?

7. Think about whether you're just going to rent out the land, or are you going to rent out plots with houses included (in which case you need to buy good quality ones, and make sure you have a mix). How will you differentiate between beachfront, inland, corner plots etc? What about the views and privacy your tenants will have?

Makes me wonder why I got into this business in the first place! lol

Inc

I guess the question is: why do you want to do it.

If it's to make money, well, that's an interesting road.

There *is* some twisted logic to starting up, being fresh and new and enthusiastic when people are fleeing and dropping like flies. But obviously some problems to that

If it's just for fun - say you get as much land as you can for say, 25 USD/mo or whatever you can afford, and then see if you can make it back plus a little... and have fun doing it... go for it!

You'll have a grand time and make some wonderful friends, no doubt. Plus a bit of drama but that goes with the territory. At that level, there aren't a lot of rules or guidelines other than 'don't cheat anybody.'

* * * * *

"Next Level" answer if you are quite serious and determined to make a go of it:

- Beebo and Incanus are both right, above.

- You'll have a great start when 'new' - but 'new' lasts about 30 days, and then an area or venture is 'not new'. What? Huh? Yeah, it's strange but true - a 'new' venture typically has about 3x the consumer interest compared to anything 'still there.'

- At the 60 to 90 day mark, interest falls off rapidly. Many of the people who were interested in your project are on to some other new thing. After three months your own interest might wane, especially after the "u deleted my house give it back u cheater" and "ask my partner 4 teh rent I cannot pay" and "I changed my mind give me a FULL REFUND I don't care if you bought a region."

- Don't let fall and winter fool you. Every North American spring and summer, people scream bloody murder as the land market contracts. You'll do great with some honest hard work, and then late February will come. Then March. Then... May, and despair. But June and July are still ahead.

- A few of us are very lucky. We got started at a good time, we are fairly well known, and reputation is everything in this world. You'll need to foster that kind of reputation as fast as possible - and even one mistake can mess it up. Even if you are right in a resident dispute, unless you can prove it to the village idiot - nay, unless the village idiot already has proof before you do - treating a fellow resident with less than sterling courtesy will harm your rep bad.

If you truly love dealing with people, and having fun with a community nothing will block your path to success. Just don't get in over your head, and never quit.

Good luck!

I have only one suggestion that stems from a Skybox a friend showed me:

Let your renters have proper prims for the price!! Sure, inside the house and all, but the rest on the land I seen wasn't cheap and you could only use like 15 prims.

15? I wouldn't do that even free =x Can't customize anything.

Just be sure to space out your place appropriately, and leave enough prim usage to share the love or offer really nice furnished homes.

I suggest that you spend a lot of time observing how someone else does it by renting somewhere first, and pay attention to the things they do right/wrong. If you don't know anything about land, you really have very little business being a landlord. It should not be the blind leading the blind.

I think you can't do better than take the advice already given Kimberlynn.

Beebo and Incanus make good, valuable points, while Desmond's advice stems from having been there and done that very, very successfully.

I'm no businessman in SL, but have a little experience in RL and would say this.

If you do this properly, get as much advice as you can and then go into it full steam, a difficult market is a fantastic time to start a business.

I tend to agree with the saying that any fool can turn a dollar in a boom market (particularly in property), and that's fine if there are plenty dollars to go around.

If you're any good at all though, and love what you do and put the energy (and hours) in, then despicable as it sounds, you can treat a market shakeout as a blessing and come out of the storm as one of the leaders.

I'm sorry if this all sounds a little mercenary. I do love what I do, but for me at any rate, money is a way to keep score and business is a competition.

QFT. I have learned so MANY little things by being an SL landlord. Stuff they don't put in the manual. Like...

- Always build aligned N-S-E-W. Building on an angle may work with the terrain and may look great...but it's a pain for any tenants trying to hang pictures or vendor boards.

- Keep the inventory for your rentals organized, even if your clothes closet is a mess. Keep copies of textures and entire builds, clearly labeled. You'll also have notecards, rental systems (boxes, doors, security, etc.) and all sorts of miscellaneous stuff.

- Set your group tag before rezzing! I don't know how many times I've got caught by this one.

- Don't "deed objects to group" except for very specific items, like internet radios that need to be deeded on group land to operate.

- Don't "set to group" unless you have partners who need to be able to move and edit your objects. Even then, consider giving them edit permissions in your friends list instead..."set to group" lets ANY group member take stuff.

- Lock your builds. Tenants will delete their houses by mistake while hanging pictures.

- Be careful and thorough in setting abilities for your group's roles. Understand what each ability implies.

- Advertise, advertise, advertise. It's harder than you think to get the word out about your business.

- Keep your tenants happy. It's cheaper to keep a customer than it is to find a new one, in most cases.

- make sure someone is on line (preferably on site) as much as possible, to respond to tenants and prospective tenants. This can be you, a partner, or a hired manager.

Size matters. In the current market, it is VERY difficult to stay competitive unless you own at least a full sim, because the tier is less on a per-prim basis...and that is the way you must figure your rents: so much per prim. Even then, you are competing with people who are charging LESS per prim than they are paying in tier. You must compete on something other than price alone. Service, theme, group events, sense of community, quality of build, whatever.

You mean share with group, right? That is a potential nightmare. They can take items, return items, retexture items ::cringe:: that are shared with group.

Wow! I love the advice all of you have given me! I wouldn't say I'm into SL business for a profit(although nice) I've been on SL for over a year and have done everything I can do here but own a business and need to go further before the game bores me to death. I love real estate in RL so I thought trying it out in SL would be interesting and by the advice I've read, interesting and alot to it. I am thinking of different types of businesses I can possibly get into and am doing LOTS of research before I do. I just wish I had photoshop and even know how to use it because designing clothes and accessories would be so fun. Thanks again for the great advice, I will definitely use it.

hmmm

I have Photoshop...

admittedly I am a novice user...

clothes are A PAIN to create. Only get into it if you love your pixels! Each and every one of them...

Inc

"- Set your group tag before rezzing! I don't know how many times I've got caught by this one"

would somebody explain this one?
Do I have to have a group to rent cottages?
thanks
Kyttn
.

It is the best way. Just make sure that you are careful with the permissions and member abilities with the tenants. Especially make sure that they don't get a share of the money when you sell group land. I screwed this up one time, but it was with an alt from Land Ninjas ( he was in the group to donate tier) and just had to email Skye to get it back

I used to do themes and builds, but anymore I just rent out parcels at the lowest price I can, and still make a modest return. This has actually become easier with the lower land values, as you can get back the initial investment quickly. I look for mainland parcels in the 1536ish range that are clean, purchase them and put them out for lease.

If you rent tier, and have a few such parcels ( group bonus) you can offer rents at around 600 a week and still make a decent living.