New Land Idea. What do you think?

With the ways things are going owning land is fairly outrageous when you look at the prices. I have been trying to think up a idea that might work to make land affordable to all players.

Here is was I was thinking up... It would be to create a land mass with small parcels at first, like "first land" set it to first land prices. The catch is that the land that is bought cannot be resold or transferred to another person, you would be able to abandon it and lindens would reclaim it and put it up for sale at a random time. This would prevent people from trying to resell it to others by abandoning it and trading it for lindens by to someone else quickly.

At first maybe limit this to 512m per account. As a experiment. If it works out maybe it can be expanded to owning more parcels next to one another, but not being allowed to split them up. Only when the land is abondoned the parcels return to there default sizes again. Eventualy the land in Second Life would be divided up into land that can be resold (Unrestricted Land) and land that isn't, basicly its for rent from Linden Labs (Restricted Land) by paying your tier fee and cannot be resold to other residents.

Only exploit I can think of are people trying to rent out the parcels. There should be some rules on what is permitted with the land. Would love to hear comments and feedback.

Remember this is a idea to provide affordable land to everyone.

sound familiar to me

Or a better idea is for the Lindens to release more land on the mainland. Add more supply and the price will come back down. They did it before when land prices where at this level.

I think this is a bad idea on many counts.

Many may support the concept of a controlled grid, in which all avatars are exactly the same, in which a creative and able user can't do anythng creative as it may upset the apple cart. In which the idea of capitalism is a terrible destroyer of all things good and where the mundane, same and unimaginitive is utopia, as then those without the skills, time or whatever wont feel left out, as they are not allowed to purchase items they want, and don't have the ability, for whatever reason to do make for themselves. Maybe extending the point of the original post, you may feel, but I disagree, if you dictate and control one area of the economy because of price, then it opens the floodgates to every area of the economy.

In simple terms, no one has the 'right' to products and services provided by others. There are plenty of free items available and individuals who will provide support and help as far as time permits, but that is not a right.

The 'right to own land' is a fallacy. Yes prices are high at present. Land only sells because people want it, not because they have to have it.

There is much criticism of land barons buying up land and making huge profits. There is a simple answer, don't sell it. As an alternative. if you want to move to a larger plot, sell the land privately and buy privately. Sell it cheaply privately and buy it cheaply privately. If you don't want the extra work this entails, then buy and sell on the open market, where land prices are where they are, because of supply and demand. Very easy to blame land baron alt accounts for the hike in prices, but the 512 sqm price hike does not cascade to a point where all plot size land prices have increased dramatically.

To have Linden Lab involved as some kind of State land owner, is a terrible idea. Linden Lab already distort areas of the market with their 'limitless supply' capabilities, this is seen in the Lindex, where market manipulation by Linden Lab means fair price transactions are curtailed. As has been pointed out above, Linden Lab could release more first land if they wished, they don't have to become a state landlord as well. They don't release more land because they don't want to drive down the price of mainland, as part of the new business model as per the economics blog by the new CFO, is to increase PI ownership. If mainland prices are too far below the PI prices then the model fails. However it appears they have pushed it too far and now have another consideration, could they push up PI prices further.

All an individual woud be doing with this proposed idea would be paying Linden Lab not only their premium account fee, but an additional land fee. Who is going to control Linden Lab pricing when they have already demonstrated they have no qualms in raising prices? (not a cirticism as I believe in the free market economy). Why does Linden Lab have to become yet another landlord competing against private landlords, where their limitless supply will once again distort the economy. This proposal is merely to create yet another landlord in the market place, only this one has the title 'Linden Lab' and I wonder therefore what is the point.

You admirably point out one aspect of this proposd system, it becomes possible to sublet. Why this is a negative point, I can't fathom, unless you are against all free market economics in the grid.

The idea to expand the plots to a larger size. This makes absolutely no sense. Linden Lab can only make land available (although I have earlier called it a limitless supply) when they have time and funds to add servers. How will people be able to expand their plots? If they are abandoned, then LL will sell them again, if you permit people to buy more than one plot, you are then depriving new people the opportuity to obtain this land.

As far as this type of proposal, there are private landlords who offer similar shcemes, cheap land rental for new users etc. There is no longer a Socialist Republic of Linden Lab, there is only yet another business with investors. The first land will be changed to maximise profitability for LL, not to maximise usability for beleaguered users of the platform.

LL are interested in getting into this market, not because they are unhappy for users to be paying so much, but because it is possible to sell a mainland sim for more than LL can sell a PI sim and as a business they can see they are missing a trick. More importantly the investors can see the Board of Linden Lab are missing a trick. Why do you think a new CFO was appointed?

Without pointing out whether you primarily sell, or primarily buy L$ the above isn't an unbiased statement. If you sell L$, it's only normal to disagree with something that gives you a less favourable exchange rate.

My own position on the Lindex is not relevant one iota.

If there is a market distortion that is exactly what it is.

My reasons for disagreeing with Supply Linden, are placed on record in the relevant LL blogs and have absolutely nothing to do with my own trading, but to do with macro economics and failed attempts by a micro economy to control global markets. This is clearly evidenced by, amongst other economic measurements, the increased activity by Supply Linden in the Lindex and the increased volume in trading, (not just hearsay) and financial transactions between avatars, which do not occur, in any sense in Second Life.

Of course it does, if you're in a position where a lower exchange rate benefits you, that's what you'll argue for, the same way the OP argues for increased LL action to lower land prices which in the end benefits her.

Supply Linden may or may not be causing a distortion, but I doubt anyone other than LL has the information needed to determine that. There isn't simply more demand for L$, there is new demand that didn't used to exist. Keeping the money supply the same while the population increases only encourages a starving effect by those who have some to spare; if all Supply Linden does is keep the ratio of L$/resident the same it has been in the past then it's a correcting effect and not a distorting effect.

We are in danger of heading completely off topic, but it relates as far as the market distortion through intervention.

I have to totally disagree with the comment, that 'I am bound to argue' for what is in my favour.

As someone based in the UK, the constant intervention by LL and the desire to peg to the US$ has played to my favour.

Just because someone believes in free market economics, does not mean they only agree with free market economics which help them. Neither does it mean that they are unaware of pitfalls in free market economics.

As an example, I absolutely support private landlords providing support and subsidies, freebies, free education and many other aspects of 'private individual goodwill' I do however object to distortive, state intervention. Which is effectively what this proposal achieves, it is without doubt the case in relation to the value of the L$

In regard to your specific question, does supply linden keep L$ / resident values at an even keel. Well that is a difficult to know exactly which 'resident' is to be couinted, but in essence under no calculation is this the case.

Further I refer you to the L$ held per resident figures, which shows an ever decreasing figure per resident. Be that in regard to any measure of 'resident'.

http://secondlife.com/whatis/economy-graphs.php

bottom graph.

Nowun is quite right that land is not a limitless supply. Linden Labs need to add more servers to make more land. This costs money in RL. I don't know all the ins and outs of LL's corporate finances but given that most of the growth in new accounts has been through basic (i.e. free) accounts, I doubt that LL are in a position to throw money around (although I'm sure they're making a considerable profit - and so they should) without some sort of guaranteed return on their investment. Selling land at first land prices may not be sufficient to pay for the new servers the land would require. I may be completely wrong, but that's the way I see it based on what little information we have.

Essentially, a return to the Victorian idea of the philanthropic venture capitalist, who (atleast in theory) helps his fellow man and happens to turn a profit on the side, is not such a bad thing. I'm no economist, but to assist the developement and growth of a community can surely bring great benefits to a business person in the form of greater economic growth and therefore increased commercial opportunities. So the philanthropists of the late 19th century learned - business and charity can not only go hand in hand but can infact have a mutually beneficial relationship; the idea of profitable charity is nothing new and perhaps SL can demonstrate to the RL business world that this older business model can benefit everyone - business itself included.

Back to the topic now

I have to ask the most simple question....

Who says land prices are outrageous?

Are you saying the prices are high? Well thats all a relative term. Certainly prices are 'higher' than they were a month ago... but that doesnt mean its 'outrageous'

As with growth anywhere, things become more valuable (or at least the perception of).

Everyone keeps saying how 'high' land prices are, but people keep buying land, so that must mean its at the right market level in tune with supply/demand. Until the demand drops or the supply increases, prices will continue to rise.

Its not even that, say someone joins SL today, and they see L$9k 512s, its the norm to them. Just because some in world have seen L$2k 512s doesnt mean a 9k 512 is 'outrageous', that simply means the market is growing, and a true accurate buyer based price is being established. We had L$2k 512s when there were under a million users, with maybe 3000 AVs on at a time. SL is approaching 3 million now, with 20,000 AVs on at a time, so natually the land is going to rise to fill the need.

Simply put, if you dont like the prices, dont buy - go rent something somewhere. IF you want to make an investment or have a solid place to call home, then buy land. If you pay $10 a month to play SL, having a 512 that you pay a one time fee of US$25 isnt really THAT big of a sacrafice when its something you own, and can resell later for more money.

I will agree that the term "outrageous" is a relative thing - and yes, I've been around long enough (almost 3 years) that I can remember "the good old days" when land was a lot cheaper. Personally I don't mind the current prices so much as I resent the *reason* that they are high - that being groups of resellers and land barons grabbing up land, jacking up the price (often without doing anything to the land) and putting it back up for sale, for the purpose of making a relatively easy profit. While I'm sure there are some that would contend that it's not necessarily easy since there is time and risk involved, the fact is that the end buyer (i.e. the person that wants to buy the land to actually build on and use) is forced to pay more without getting anything of value in return for the extra cost.

This, is my mind, is very similar to cybersquatting, where people grab domain names that they personally have no use for, in order to profit by selling them to someone who actually *does* has a use for it.

As a result, it seems that there are a lot of people who are looking for land in order to build on, but reluctant to pay the higher "outrageous" price, so therefore are waiting. This in turn inhibits development, creativity, social activites, etc. etc. while plots of land sit with For Sale signs on them. I can't see how this is good for Second Life at all.

Like others, I would like to see Linden Labs do something to discourage such practices. A time limit for reselling the land has suggested - perhaps that would work, or perhaps there would be better ways. Or perhaps, as with many other areas, LL will simply decide to step back and let the players work it out themselves.

One final side rant: I question the term "realtor" that the resellers often use. Unless I'm mistaken, a *real* realtor or real estate agent works for the property owner, and makes their commission in various ways, from giving advice on making the property more appealing, to bringing potential buyers to the view the property. Resellers of course do not do that here in SL - therefore it seems to me that there are other terms that would be more fitting *grins*

Bopete i can agree with your post as well.... however a 'time limit' isnt the way to go. SL is about user freedom, not restriction and a timelimit would never work

The solution is very simple, everyone overlooks.... LL needs to create more sims weekly, increasing the supply to meet the demand.

No one noticed last week, LL prepped and released 18 mainland sims, the sale price on land stagnated that week at around 15.2/sqm because of the influx of firstland and auction land. Now, no new sims or land is available, prices are on the rise, as of right now climbed to 16.0 as the low end of the market.

Its very easy to see whats going on if you look at the data given, instead of making guesses at the reasons

I dont think its cybersquatting, its more that a LOT of new users hear something in the news about someone making a perceived fortune, come into SL and dive right into the land market not knowing the market itself. I've seen it a lot with n00b land brokers. For example I've seen newbies buy firstland 512s and cut them into 32 16sqm plots because "they see others doing it and think it works" not knowing what kind of eyesore that eventually creates in the sim.

And I dont pretend to be a 'realtor', i buy and sell, thats what i do

I think the land crunch, personally, will be coming to an end VERY shortly. So I'd imagine soon we'll start to see a decline in land prices. Keep an ear to the ground and you'll hear all kind of things... and we'll just be calling the last 2 months the "land boom of 2006" and 2007 will be something else - all in all it'll be intersting to see why and who is complaining when mainland drops to 5-6/sqm and everyones crying because the bottom fell out of the market Cant please all the people all the time

Just as a little aside, the term "Realtor" is a registered trademark of the National Association of Realtors, so unless you are a licensed Realtor, you can't call yourself a Realtor.

There just needs to be more land or less demand. Those are the only options that will bring the prices back down on the mainland.