Auction Action Takes a Breather: 'Bout Time or Keep 'em Coming?

For the first time in many moons, LL has interrupted the flood of mainland to market. Maybe it's because there are only three people left in SL willing to bid on full mainland sims and carry the pricey tier.

I, for one, think the break is a good thing. I'm not planning on selling anytime soon, but I don't think it's fair to the people who bought land a lot higher in the last year to have to take a huge loss to tier down. We're talking a 50% correction in the last month and a half.

I know some folks want to see it go to L$4 a meter, but I just don't see that happening given that SL still sells Islands at a much higher tier than mainland and there is no margin for sellers at that price.

Regardless, let's talk land. It's my favorite subject next to runaway crabs, dead parrots and Brenda's panties (not necessarily in that order).

IDK I'm just hungry and pie sounds good ; )

They have stated that land will keep coming at an average of 8 sims a day until at least the 14th. So if they have a slowdown a few days, that just means that a bunch of sims are about to be released. With the long weekend that just passed, I am not surprised that there is a lack of new sims right now.

Tricky - with the latest auction prices around US$1400, it is now feasible for someone wanting to own a sim, to chose between a mainland sim or an island sim - whereas before buying a mainland sim without intending to sell it off, was really only for people with lots of money to burn!

Before at 3000 for a mainland sim, you were better off financially with an island - true an island costs US$100 a month more in tier, but it would take over 15 months before that saving off sets th additional US$1400 in purchase price, and that assumes that LL doesn't change the tier fees in those 15 months.

Even at 2000 for a mainland sim, it takes about 6 months before you break even.

It also, I suspect, has slowed down landbot usage - the margins must be so small now, and the surplus land for sale slowing turnaround down, that if you don't manage a landbots quota of land it is allowed to snap up carefully, the tier fees incur could exceed profit.

On the other hand, the land market recession will have financially hit anyone in SL who bought mainland in the last 6-12 months, and will be hurting anyone dealing in selling or renting mainland either big or small, and having some impact on island landlords too!

Matthew

I'd like to see them keep producing land until all the land flippers just give up because anyone can buy a nice hunk at a fair price.

Another thing in re land... 512 is too small to start any sort of build on, it jams folks in too close together and most people over build for the tiny lot, the word ghetto comes to mind and clutter. In a perfect SL world (mine anyway) flippers and cutters would quit, land would be cheaper and tier would be lower so everyone can really dream big in this wonderful medium.

Very true. I am one of those people. I chose mainland and got a sim with water and lovely terra that I don't plan on cutting up for resale.

You suspect correctly. Landbot runners are not running into much profit these days.

Two slices of pie for your astute insights, Matthew.

I wish ad cutters would disappear. Can't say the same for flippers. Some of my best friends are land brokers.

What LL could end up doing is sell mainland directly to customers using the normal inworld land selling mechanism rather than using auctions.
This would be sold at cost value which is around 4 or 5 L$ per square meter.

From Linden Labs point of view the reasons for doing this would be due to the low cost more people would buy land/go premium so increased profits for LL from tier.
The reasons against doing this is it would require a Linden to do the boring work of cutting up the land into parcels of 512 or 1024sqm.

The main problem I see with this is that some very bad parcels like mountain sides will never sell at that price and they wouldnt want to put the man hours in to adjust prices to make things sell.
If they could do an automated system where their land starts at a higher price then goes down over a few months since the time it was first put up for sale by them, this would solve that problem.

To be honest landbot competition is as tough as ever none of the existing runners are likely to quit no matter where prices move.

What has really suffered though is the mainland rental business. It will take something like 5 months of renting for me to make up the money I lost in the land price collapse. That's assuming prices don't fall any further. At this point it obviously would have been smarter to just sell my land a month ago than rent it out for this time.

Of course, it's all my own fault, my margins are very tight on rented land and came nowhere close to covering the risk in the volatility of land prices which is extremely hard to quantify. I'd guess most people don't even think of it as a cost that needs to be covered. Really at the rates I charge I can only afford a move of L$0.03/sqm/day and we've moved at about L$0.15/sqm/day for a month.

Right now I'm really banking on prices hitting a LOT of resistance at 5.25. If we start dropping under that I'm seriously going to have to halt all new rentals or totally change my business model to include variable rental rates or something. I have some ideas on ways to model the weekly rate to optimize income which I'd like to test out.

I voted. Now "Keep Pie coming" and "Keep 'em coming" are tied.

I'm happy with my park I created on my 512 plot of land, thank-you very much.

It seems that the pair of Brenda's panties I bought at auction have held their value much better than the land I have bought over the past months.

The prices of the auctioned sims are not commanding the $1700-$2100 they were a couple weeks ago because the sims they are offering at the moment seem to be all moon crater terrain or very steep hills. The prices will creep back up once some decent areas become available again.
I do see a lot of sims that were bought and cut up into 1024's etc on flat green land/water still sitting for sale though..seems their asking prices must come down soon.
Speaking of the ad farms, its so sad to see these new sims come online, and within days the 16sqm ads pop up all along the Linden protected pathways,,,immediately ruining the land next to it and most assuredly driving down the price.
Still trying to find a sweet spot in the rental business..any ideas? I think the 1700-2000sqm plot has potential, enough room for someone to build on and can be rented at an affordable price for most residents.

I think you are very very mistaken about this.

personally i believe ll are dumping so much granite mountain side out of contempt. 'dont wanna pay 2500? then you get this...'
im so turned off by the land market right now i dont even look at prices anymore. i have too much devalued land as it is.

Thanks for being forthright about your current woes. Have a piece of pie on the house.

You could add more value to your rental land with landscaping, theme, public areas, poseballs, etc. But that would kill your margins and take too much time. Unless you only have one sim and concentrate fully on that.

How about putting a product on your land, like that lovebox sex room I've been running into on cheap parcels?

I got a spectacular waterfront sim with two beaches for $1951. A ton of nice beachy sims have gone for $1500 or less since then.

When they start offering less granite and more beachfront, prices will still stay below $1700 at the rate they are dumping sims on the market, unless someone falls in love with a particular sim and throws caution and money to the wind.

Land for Sale Today
Residents With Parcels for Sale 7,341
Total Parcels For Sale 45,397
Total Square Meters for Sale 32,890,832 /65536 = over 500 sims for sale right now

Great time for the end user to buy land.

Wow, that's a lot of yellow. Thanks for the perspective, Alan. How do you like your pie?

Well $1951 iS the price I said prices would creep back up to for nice land. Now...$1500 for the other sims with sandy beaches? Outstanding,,were they Mature? was the beach somewhat flat without a steep hill on its edge? If so I am very, very jealous of the winner.

Just to prove the point here are the stats from May

http://web.archive.org/web/20070515142901/http://www.secondlife.com/whatis/economy_stats.php

Residents With Parcels for Sale 5,428
Total Parcels For Sale 30,514
Total Square Meters for Sale 21,745,568

*edit: Here's an interesting thing.

Residents logged in in last 60 days
May 356007, September 458156, increase 28%

Residents with parcels for sale
May 5428, September 7341, increase 35%

sqm for sale
May 21745568, September 32890832, increase 51%

In other words number of land sellers is proportionally increasing with population but amount of land is much higher. People own more land.

Sooooo who do suggest buys the full sim auctions and then makes them sizes the average resident can afford? And honestly, I think 5L a meter is very fair. Thats not much more than it was about a year and a half ago, and no one was bitching about price then.

I got out of what once was the apple pie flippin business in the Spring when i started to see an assembly line of yellow (lemon?) pies coming and more and more of those pies just melting away in the hot summer sun. I hope it won't be rhubarb pie soon

I had gotten in the bidding last week for Ancient Rising, a nice sim with waterfront on protected water and a nice landmass. You bet your bottom dollar that sim went for about 2k. If the plot of land is right, it WILL go for more than 1400.

I would also like to keep the pie coming but you wont let me vote for two so i'm putting my second vote here