Illegitimate Business Practices

I just joined, and bought myself a house, and am now looking to buy some land to put the house on.

Funny thing, that. Game dollars have an exchange rate with real dollars. Hence, they are real currency. If real currency can be used to purchase SL land, then that land is Real Estate. Virtual or not, it is a property.

I've spent hours cruising through SL, and seeing a whole lot of land for "Sale" that carries with it a "Rental Fee". There's the hitch. You cannot sell and rent the same property to the same person at the same time. It is either sold OR rented. Not both at once. That is not an AND question.

It therefore seems obvious to me that a number of people are exploiting SL to engage in unlawful business practices for the purposes of personal gain.

It is not for me to decide, but I would rather think that would be a *bad thing*. If SL is intended to simulate an alternate reality, and I am not, for example, allowed to 'cuss out' another person, it seems rather odd that I cannot 'cuss them out', but I can cheat and exploit them freely. That seems a touch hypocritical. By the Terms of Service, I can't call you a jerk, but I'm perfectly within my rights to shove a dirk between your shoulder-blades, or steal your wallet. Huh?

Any thoughts?

Oh, dear. It's such a nice Sunday (at least here on the Eastern seaboard). I'm not sure you can get a quorum of posters on this old topic. We've simply beaten it to death over and over again, in thread after thread.

Wait! What am I thinking? That's never stopped us before.....

Island land can't be bought. Only the right to rent the land can be bought, and only through the voluntary compliance of a land lord will you be able to continue renting without fear of finding yourself unexpectedly ejected from the land and all your possessions auto-returned (into one damn little prim that newbies toss out without realizing it holds everything they own).

Despite this fact, some island owners will insist they are "selling" land and that the lack of an enforceable contract is merely a bagatelle. Or is that a bagel? I forget.

I'm in the "You can't BUY island land, but go ahead and rent it if that's what you want" camp. Ha ha ha, I got the first shot.

This used to be a problem. Now there is a mainland tab in search. Select it and your worries are over. Every plot on this list is for sale, not rent and has no covenant.

One reason to buy a parcel on a pi is so you get all the normal rights, like terraforming, setting music, power to freeze, etc. without needing to be part of a group. We all have to pay a weekly or monthly land use tax, either directly to LL (mainland) or through the sim owner (pi).

You may also be looking at my mainland which is for rent OR sale. Your choice. Of course if you buy it then you own it and don't have to worry about anything except keeping LL happy.

On islands, you buy the land and then pay tier fees just like you would on the mainland. I agree, landowners on islands must choose their estate carefully because they don't have as much protection as they would on the mainland, but if you call estate land renting, then mainland is renting by your definition. Estate owners call it owning because the tier fees are often similar or less than they would be on the mainland, you can resell your land, and you get a lot more value on an estate than you would on the mainland. That's just my opinion, and you're welcome to disagree. But I've been dealing in both mainland and islands for awhile now, and can see that the value offered by estates is far superior to mainland for many residents.

Whelan... it doesn't matter either way.

When you BUY land, no matter how you do it... you are indeed RENTING it.

If you get land on the Mainland, you must first become a Premium Member, purchase your piece of land and then you will have to pay tier <RENT> to Linden Lab every month as long as you "own" that land.

If you get land on a Private Island (Dreamland, Azure Islands, Caledon, Anshe Chung communities, etc.) you will have to pay RENT weekly or monthly to the land baron of your choice. S/he has to pay tier to Linden Lab.

So either way, you are still renting land, and there is nothing you can do about it. Either way, you pay on a regular basis to someone, either LL directly, or through the land baron of your choice.

There is a third option, there are people who rent land with no upfront payment. Usually on a week-to-week basis, and if you don't pay, your stuff gets auto-returned.

Max

So you consider any form of regularly charging landowners as "unlawful"?
Personally I consider tier payments as more of a council tax.

That initial payment you made does not provide for an infinite provision of services. There's the cost of running the servers, bandwidth, coders to do updates etc, just as real life land purchases do not provide finance for the infinite provision of road resurfacing, street lighting, garbage collection and other things.

I refuse to believe all the island owners who say they "sell" you land.

Any land that can be taken from me on a whim is NOT land I own.

There have been too many discussions, both here on SL forums and other forums, about landlords giving their tenants the shaft. The worst part is that Linden Labs will do ABSOLUTELY NOTHING for you if one of these landlords rips you off. You can lose L$100,000, and LL will say "It's between you and the landlord". You have NO way to get your money back.

Check out the SLExchange forum - there's a recent thread there about a scamming landlord who, when the bad press about them started going around, evicted FOUR SIMS worth of tenants, many who had paid them hundreds of $US. Then try to say that renting is safe.

I will never "buy" anything but mainland, and I would never risk renting an island parcel. It's highly unlikely I will ever lose my land, because I will always pay my bill and I won't do anything that gets me banned. That's the only thing that's good enough for me.

Actually, even "owning" land on the mainland doesn't constitute ownership in the usual sense known by Americans. I mean, you CAN, I suppose, think of tier as a sort of property tax, but personally I find that thinking of "land ownership" as more of the sort of "ownership" one commonly finds in London more appropriate. You're buying something of a "lease" that gives you exclusive rights to use the land, but the minute you stop paying your "maintainence fees" it all reverts to the freeholder, in this case LL.

It's not exactly the same, but I find it a useful metaphor.

Kam

Caveat Emptor - Let the buyer beware!

I understand your frustration, but with patience, reading, and intelligence the likelihood of being scammed is zilch.

First, if it's too good to be true, then it probably is. It costs around 6.92$L/meter to purchase a new island, unless it's pre-November or the owner is in it for the long run (tier) expect to pay around this price (+/- ~2$L/meter).

Second, before you buy the land (and also under the covenant window -- I think) it will display at the top whether or not "Parcels bought in this region may be resold" or "Parcels bought in this region may not be resold". This will tell you whether or not it's allowed (of course a shady landlord could change these settings after you buy the land).

Third, check out the neighbors. If you click on "About Land" you can see when the claim date for the land was, chances are it's not a scam if they've been around for awhile.

Fourth, go to World -> Region/Estate. Even though you won't be able to change the settings you can see if you're able to terraform (and to what limit) or subdivide the land.

Fifth, if the above looks good read CAREFULLY through the covenant, while you're at it click on the "Estate Owner"'s)profile and see when he/she was born and his/her picks, et cetra. If they're 3 month old or less I would normally pass.

If you've done the above you will rarely get "scammed". If you want to save yourself some time just skip the first two or three pages of Estate/Island listings. Start looking around 4$L/meter and up.

<-- has never been scammed, but has made some mistakes, learned from it, and moved on.

All virtual land in SL comes with a recurring maintenance fee. On mainland, this is referred to as "tier." On private sims, the sim owner (not the owners of the individual parcels) is responsible to LL also for "tier." It is customary for the private sim owner to pass on this recurring maintenance fee to those who in turn "own" the parcels he sells to them; in such cases the fee may be known as "rent" or "tier." Also on mainland, some people make houses or land available for "rent" at a rate that provides a profit after "tier" is paid.

Regardless of what LL or your private sim owner might ethically be expected to do, there are no guarantees in SL (this is an explicit part of the ToS) for anyone.

I see little if any difference with what occurs in real life. If you "buy" a house, and then refuse to pay your property taxes, income taxes, etc., just see how long it takes before someone with a badge and a gun comes and takes it away from you. Even in RL, ownership rights are not absolute. Depending on where you live, your land ownership may not include mineral or oil rights, you may be restricted as to what activities you may engage upon on your own land, and you are liable to have your land seized for a number of reasons including just so the government can build something they want more. In some US states, the tax assessed based on your landholdings is actually called "rent" (those would be the areas subscribing to Georgist economics).

Another way to look at the SL situation is to acknowledge that all we are really paying for is network server resources. Some pay LL directly, some pay a middle-man. People would not pay the middle man if they did not get something valuable in return. Some of the reasons people are willing to take the extra "risk" in buying/renting/whatevering from a private sim "owner" are: Lower tier/rent/whatever than would be paid for a similar-sized parcel on the mainland; pleasing zoning restrictions; extra prims; better customer support; better terraforming capabilities; and more. BTW, how many land-flippers have you noticed on private sim land?

As to the risk involved in buying land from a private sim owner, in my opinion some private sim owners are more trustworthy than LL itself.

The reason why private sim owners "sell" land is so they can just keep on buying new sims without investing any of their own money into it. A sim owner selling their private land at a "fair" price just means they'd rather invest your money into buying a new sim rather than their own. The other reason is to make sure you're not likely to move out, because you have to first sell the land (assuming that's even possible) because most won't refund you for it. All in all, far from an honest approach.

Lower than purchase price isn't a scam by default either, in a lot of cases the purchase price is simply the first week/month worth of rent.

The only honest deal is a pure rental solution where you pay weekly/monthly and then most money you could be out is a week's or month's worth of rent.

I'd have more faith in a covenant that clearly spells out that at no point can you assume that you have any claim or right to the land on their sim, than one that tries to trick people into believing they're doing anything than throwing their money out the window.

sigh

You can sell and rent land to someone, quite legally. It is called "leasehold". Hong Kong (yes, that famous one) is perhaps the most famous example of such a contract.

I'll give you a couple of good tips..

1) Dont rent. (you just paying someone else's bills until they want rid of you)
2) Walk away from anything with a covenant. (cant do this cant do that etc, still not yours)

Just buy your own land, its hassle free, you can do whatever you want and when your done, just sell it on and get your money back.

I got a problem with most of the responses so far to this thread........as I've had the same problem with responders in previous threads on the same subject. All these offerings of "do your homework" or "research" before you buy.........how tier and rent work after the purchase of any land whether it be mainland or private land. Just how the heck is someone who has joined SL a week or maybe even two months ago supposed to know all these pitfalls and "watch out for the scammers"? I've been here for quite some time and still finding things to beware of in the land buying part of SL..........there is no control over Linden Labs property. Every sim..........private or mainland is the property of Linden Labs. They own it..............and ultimately no one else does nor can they ever own it unless LL decides to alllow private servers in an open source platform. No one is protected from unscrupulous land "owners". And there's no reliable way of knowing who are the bad guys or good guys.

I have a good friend in SL who "bought" a 1024 plot on a private sim. She pays the equilalant of $7 USD a month to the sime "owner". She paid $7000L upfront to "buy" the plot. Had she bought a similar plot of mainland (but mainland is very rare at a reasonable price) her monthly tier would be $5USD. The owner is making an aditional $2USD a month off her. She did not fully understand that when she bought the land..............and I helped her find the land and I was unclear on it too. The sim "owner" is not doing a thing wrong as far as SL is concerned.......but in my eyes he is. He is gouging. There is nothing that can be done either except to "sell" and go homeless.

Now tell me that land purchases in SL is anything more than a crap shoot. You'll never convince me. And ONLY Linden Labs can put a stop to it. But we all know they won't. It is a shady business.

I don't know if the land your friend is paying 7 usd a month for has a covenant, but if so, your friend is paying that 2 usd a month premium for the security of knowing that no one who would break that covenant can get in. If that covenant means no camping chairs, casinos, or clubs in there, that is a very good deal in my opinion.

Spot on.
When I rent out part of my server resources to friends so they can have a website or shoutcast stream, they wouldn't claim to own any part of my server, regardless of any up front fees (not that there is any).

I rented on the mainland when I was new and couldn't stand it for more than 2 weeks as a club went up next door and that was the end of that.

I bought my first parcel on a private sim and then I sold it last month for a profit and bought a bigger one. Just like on the mainland. Yes, the estate owner could decide tomorrow to leave SL and I would need a find a new place to put down my prims but with a little research, you can find very well managed private estates with respectable landlords. I dunno, it suits me just fine. I definitely don't see it as a scam. I pay my tier to the estate owner and she pays LL in kind.

I read the covenant. There is no protection against clubs though there is a restriction on camping (if I remember correctly). All plots were initiallly sold as 1024 only...........I thought that was a good thing actually since it would make it a little harder for someone to get a 512 lot and put a club on it and buy over plots to cover the prims. But the point is the "seller" presented the land as land that the "buyer" has total control over (within the covenant) and that the "tier" could be paid in linden or through PayPal. And my friend opted for the lindens...........which fluctuates according to the linden to USD exchange rate on the due date. That's a sneaky way of making the "tier" appear attractive.

It may be a good deal in your eyes.......but it's wrought with loopholes and unclear possibly unfair ways of getting a little more out of the "buyer". My friend admits the owner has not lied to her............but he sure skirted the facts at the time of sale. I call that barely legal.............and unethical. Had the "seller" told her that she would be paying him additional $2 USD for the service he is providing then I would not have a problem.........he did not. I was there with her and read all the open chat to both her and me.

I'm not saying the "seller" did anything wrong. I'm saying that Linden Labs, without any "covenants" of their own make it very possible and even likely that "buyers" will get ripped off. And no new user of SL has a way of knowing that. Yeah, that new user will learn............the hard way.

A 1024m² plot actually costs a private sim owner $3/month ($195 / 64).

So the $7 USD a month is really a $4 USD mark up? LL actually put in a profit for the sim owner? That's a good thing as I see it.........but for the sim owner to double that profit margin without telling the buyer just doubles my argument. Land buying in SL is wrought with potential abuse. And Linden Labs just washes their hands of it.

So the OP's contention is true. It is illegitamate business practices.

The mark-up isn't necessarily an evil thing, it all depends on what kind of service the sim owner offers.

In theory, renters on a private sim should be turning to the sim owner to deal with any problems concerning their land or the sim in general (griefers, prim littering, bad lag, restart, day to day questions, etc).

In practice, a lot of people use live help anyway, or some sim owners actively encourage them to go to live help because "Lindens will fix that for you" resulting in them getting upset and confused when they're referred back to the sim owner again.

Beside $195 tier, some of the owner is also paying 299 tier for island bought after the price increase. which is close to 4.7

One other thing that teh markup pays for is the sim owner's investment risk - they don't have any guarantee that they will be able to keep it filled with sub-tenants. Or are you suggesting they have no right to expect to profit from it?

To be fair, the way you describe it, it doesn't sound like the kind of covenant I would want to rent in. However, the covenant was provided upfront, and you agreed to it. It isn't as if the landlord actually lied in any way or broke taht covenant is it?




It seems the landlord told the tenant that the fee would be 7 usd per month, and you do not appear to be disputing that. I don't recall any law that says your telephone company is obliged to break down exactly how your electricity bill money is being spent by them. Why should a landlord be any different in that regard?