Land prices - swings and roundabouts.

Over my time as a premium account holder I have traded bits and pieces of land, usually at a modest profit, working my way up. Yesterday a piece of land very close to my home came up for sale at about twice the expected market value. This land and my home are both are 'roadside' (future Linden highway) so there should always be access between the two plots.

Buying this land has put me into the next tier for a month, so I'm probably going to sell off some of my other plots at a knockdown price to lower tier for the following month.

This illustrates two of the factors that can affect land prices over and above normal market trends.

As an aside, I came across a 16m plot for sale for 8,000,000 Lindens. The owner is a newbie who I guess doesn't realise that you could buy several sims and a year's tier for them for less than that!

Oh, I don't know. Maybe he's hoping someone with L$8,000,000 in their account will misunderstand--think he's selling it for L$8 and click "buy."

But yes, I agree that the land market is much more than simply send a bot to buy anything less than L$X/m2 and resell it at L$X+5%/m2 (though that may be a valid low-margin, high-volume business). I sold 8096m2 last tier cycle at a US$80 loss, and bought some other land a couple of days ago several L$/m2 above market. This sort of thing happens all the time. Not every m2 is equal to every other m2, and we don't all value our time or L$ the same.

And therein lies the tragedy of the grid.

Land in the same sim as land you own is worth a LOT more... but only to you.

Either in a negative way: don't build a casino here! ... Or in a positive way: I can pool more prims!

I think this is how people can manage to sell absolute garbage land. It's nothing more than prim-farm for people who have good plots elsewhere in the sim.

More likely the owner is an alt of a land speculator, who hopes someone will buy the parcel to prevent him from placing something truly annoying on that worthlessly small bit of land.

Is it worth what he is asking? Of course not. But if it's in the middle of your land, or on the edge of your land, and he sticks a rotating, noise and particle spewing monstrosity on it? Well, you just might pay his extortion to be rid of him. At least, he hopes so.

Or it's a advert-griefer's plot and they get a couple more eyeballs when people curiously click the $ on the map.

There was 3000sqm plot that was abandoned ages ago next to me. LL finally put it up for auction a few weeks ago and I bought it. Got it for about L$35K but was willing to bid up to L$100K. Dont want the land, dont need the land, just bought it to stop some twat putting up another eyesore next to me. So in this instance this plot of land was worth more to me than nearly any other in SL and I was willing to pay through the nose for it, far above it market value. Stuck lots of trees on it which has pleased the neighbours.

If you are intersted, I am offering a 25% discount in LL's tier fees.

I donate tier to your group in increments of 1024m so that you can get the exact amount of tier you need, in exchange for only L$1,600 per month (25% off LL's fee).

Contact me in world or private message for more information. Up to 7168m of tier is available for lease.

-2fast

I wondered about ridiculous land prices, but I found one explanation. I was looking at a nice plot that showed up as yellow on the map, and when I got there, found it was priced at L$ 9,999,999.

The reason was the seller simply wanted to open negotiations, and that absurd price was to be read as "make me a sensible offer".

This is an interesting business model. It never ceases to amaze me how people think about any angle to take advantage of the system. In this case, 2fast4u is providing a service some will find helpful at a fair price. Cool.

A tip I've found is to avoid small plots on narrow strips of land sandwiched between 512m, 1024m, 2048m etc. plots (round numbers as far as tier is concerned) - such neighbours are less likely to want to buy and the land is of little value to anyone else.

It's not a new business model, others have had the same idea. However, it's not clear how much demand there is for it.

L$ 1600 for 1024 sq. m. represents L$ 1.56 /sq. m. /month. It is certainly possible for large landowners to undercut this, though. LL's most favorable tier rate of $US 195 / 65536 sq. m. /month represents L$ 0.82 /sq. m. /month at current exchange rates.

However, there are trust issues: does the tier borrower pay in advance or at the end? There are also issues such as, what if the tier lender needs to withdraw the tier on short notice (maybe a parcel of land that he really really wants unexpectedly came up for sale).

Some have even considered creating a "land bank". Premium account holders could donate unused tier to the land bank group and get paid, say, L$ 0.5 /sq. m. /month, and the land bank group could then loan tier to land barons or to people wishing to do land swaps without incurring the "higher tier even if you only hold the land for five minutes" rule.

There are currently a few drawbacks to the land bank idea though. First of all, it would require the tier borrower to deed their land to the land bank group, raising major trust issues. LSL provides no way to get group tier contribution information, so you'd have to modify libsl bot code to do this. Even so, I suspect a lot of the bookkeeping would require manual intervention and would be hard to automate. And finally, LL could change the tier structure at any time, making the whole exercise moot. In November when they raised island monthly fees there was widespread speculation that mainland tier could be adjusted as well, and LL has not ruled out that possibility.