Investment in a Sim

[Dante Seminario]

Hello, So I was thinking about buying a sim and renting it out, however I'm wondering if it will even be worth it and if it's even a good investment?

In the past I know you could rent out sims for rougly $100 per month profit but I'm sure that has changed within time, even if it were that it would take about a year to pay back what you paid for the sim, to gain interest on it.

What are all of your thoughts on this? Would be even better if I got input from some one who has bought a Sim and rented it out.

Thanks.

-Dante

[acidphyx]

I have been looking at doing something similar and have been curious about the same economic feasability. 

I would think that with a really well placed, multi sim connected, location with alot of in-sim/on-site entertainment (may take a few people working together). Possibly two adject and connected sims, one for residential and one entertainment/comercial.   Adult Living Oriented without being whoely pornographic. Movie Theatre, Off-Shore Cruise Party Yacht with access via helicopter. Large beach access with loads of free rezzable personal water-craft, and paid Mooring space. These are just some ideas. I'm sure there must be alot more as well.

I currently rent a 1/4 sim, have been looking to rent the 1/4 sim next to mine. But I would love to look at the prospects of multi owner large community situation. 

My overall thoughts being that I myself tend to rent one place only for a couple months, either due to landlords moving or the place just becoming stagnant. I also see lots of places around me switching renters frequently as well. I think if a place was created with entertainment, Living E.T.C It would encourage people to stay within for most of what they need. Then it would be more viable these days. 

[Knowl Paine]

I have not purchased a Region nor have I offered land for rent.

I think that buying a single Region for the purpose of renting it out for profit is a bad idea. You could learn and build a customer base with a much smaller investment on the mainland. Starting with a full region is a lot of obligation. On the mainland, you could abandon part of your tier liability if you had to and your tenants wouldn't be disturbed.

If you know you can afford it, then go for it. Give yourself 90 days to become self sustaining. If the rentals aren't paying the tier by then, consider hiring help or throwing in the towel.

You could buy an existing region to save money.

If I were to buy a region, it would be for fun. If there was extra land that I wasn't using, I might try to rent it. 

 

[Amethyst Jetaime]

Buying a single sim and renting it out is not as profitable as it was at one time.  Your rent must be competitive and you are competing against large estates that get a discount on their tiers or own grandfathered sims and pay less to LL than you will have to pay.  A number of these estates can charge rent that is the equivalent of your cost and make a profit.  To make  profit you have to charge more than your cost.

Even once you have established your business and rented your land out to stable tenants you will still have vacancies from time to time as not many people rent land and stay for a long period of time.  So you will end up having to paying part of the tier out of your own pocket some months or lose your sim.

Starting a rental business can be an uphill battle too.  You will find it difficult to find reliable and stable tenants at first simply because a lot of people don't want to rent from someone who has not been in business long enough to establish a good record as a landlord.

You must be prepared to offer excellent customer service in a very timely fashion.  This extends to not only being able to help your tenants with the actual rental process, but also assist tenants who don't know how to set up media, therefore, or do  wide variety of things.  You also may have to diplomatically arbitrate between neighbors that have issues with each other, even issues that have nothing to do with the land.  Disputes can arise where people are nasty to each other to the point it effects your other tenants who won't put up with the drama.  They'll just leave.  Providing good customer service takes time so you must be willing to give up some or all of your own free time to provide it or pay experience employees to handle things for you.

Never agree to allow another estate owner to locate their sims next to yours, unless you have a RL contract spelling out all the specifics and contingencies and are willing and able to take them to court to enforce it.  Even so, the other owners may have insurmountable RL issues forcing them to sell their sim to someone who you may not get along with at all.  I've never seen one of these arrangements work out well unless you have that RL contract, you have known and trusted the person for long time, they are financially stable in SL and RL and have plenty of cash reserves in RL or you are able to help with their tiers if the worst happens and they have a RL financial emergency.  LL will not help you enforce any agreements you have without a court order and if things fall apart will not separate the sims unless someone pays the $150 US dollar fee for each sim to be moved.

If you decide to try this out, draw up a realistic business and marketing plan, purchase your sim on the secondary market for as low a price as you can afford, have and maintain a cash reserve to able to pay at least 3 to 6 months tier on your own, Also offer things large estates don't to add value to your higher rent charges to be competitive and be willing to give up your free time and work very hard at first to establish your business.

 

[acidphyx]

Thanks for the input. It sure is alot to consider. :-D