A tenants guide to the real costs of owning sims in SL versus what you pay in rent ... aka how much profit is your landlord making for whole, half, and quarter sims?

[Katherine Heartsong]

I am coming at this from a simple view of costs. I've considered renting larger parcels a number of times over the years, and while I am happy to allow for a certain amount of profit, I do get my knickers in a twist when it comes to landlords who are charging a bit more than seems fair.

Granted, everyone's definition of a "fair profit" in SL land dealings will differ (mine's about 10-12% if anyone's interested), but all I hope to do with the numbers below is inform potential renters ... who are looking to rent whole sims, half sims, or quarter sims ... what the cost of owning actually is in Lindens per week for the sim owner/landlord, and let you (the renter) make up your own mind if the prices they are asking in rent is fair to you. I've not seen this sort of guide before, so wanted it out there for transparency's sake.

I really want to stress that I've done this not to upset anyone, but to provide information for renters so that they can make better-informed decisions about what they are willing to pay for rent. Information about the actual costs makes for better decision-making by buyers, and that's my intent with the post.

Here are the basic things my calculations are going to be based on:

1. Using US$ for all my calculations.
2. Assuming the landlord is in the United States, and that VAT does not apply to their sim fees
3. Full (30K) sim cost = $349 to buy (one-time fee), $259/month
4. Full (20K) sim cost = $349 to buy (one-time fee), $229/month
5. Full (5K) homestead sim cost = $149 (one-time fee), $109/month
6. Current exchange rate (Nov 2, 2021) = $1 = L$241 (excluding $1.49 transaction fee)
7. For Linden calculations I always round to the nearest full L.

Important note here: I am going to do and then show two sets of figures:

1. Taking the cost of buying a sim and including that over the first 12 months of sim ownership. For example, in the case of the 20K full sim, that will mean the $349 is rolled into the full year of $229/month.
2. A second set of calculations that is for year two onwards, when the initial sim buy is all paid out, and therefore does not affect the cost of the sim ownership for the landlord any longer.

Finally, before anyone reminds me, I'll clarify two more points ... I am not taking into account any support costs, because these can range from none at all needed (if you have an even basic idea of landscaping, giving group memberships to other users, etc, to full on "what's a land impact?" types). And also I'm assuming flat grassland/sand sims being rented without extensive custom landscaping. Again, this one is tricky in that once a template is made for terrain shape (RAW file) and or landscaping, it's a simple task to duplicate these over and over, so the cost is largely in the landlord's initial effort.

I may get flack for taking both of these out of my equations, and I agree these are valid points to take into account, but my goal is to to show only quantitative costs, since both of these points (support, landscaping) are something a landlord/tenant will place a qualitative Linden value on, and the potential renter can agree or not that these two things are being offered at what they consider to be fair amount. But with my info below, the renter will know the exact costs for the landlord, and can make the purely qualitative judgements using their own metrics.

However on the flip side ... and again this bugs me a bit ... I have not met any landlords who offer to discount the rental price after a year of them owning a rental sim despite having made back their initial purchase price. In other words, landlords are often making much more rent profit after the first year without passing those saving onto their tenants. Please point me in the direction of those landlords who do though, if you know of any!

So, let's get into the math

Year One (where I amortize the costs of buying the sim into the numbers)

Costs (30K sim)	$/L$	Notes
Buy	$349	initial buy for a full sim
Cost / month	$259	this is $30 more than the "standard" 20K sim
Cost /year	$3,457	including the Buy price, thus = $349 + (12 x $259)
Cost / week	$66.48	(cost / year) / 52
Linden cost / week	L16,022	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L8,011 or L4,006	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (20K sim)	$/L$	Notes
Buy	$349	initial buy for a full sim
Cost / month	$229
Cost /year	$3,097	including the Buy price, thus = $349 + (12 x $229)
Cost / week	$59.55	(cost / year) / 52
Linden cost / week	L14,353	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L7,177 or L3,588	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (5K homestead sim)	$/L$	Notes
Buy	$149	initial buy for a homestead sim
Cost / month	$109
Cost /year	$1,457	including the Buy price, thus = $149 + (12 x $109)
Cost / week	$28.02	(cost / year) / 52
Cost / week	L6,753	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L3,377 or L1,688	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

 

Year Two+ (where the initial purchase cost of the sim is paid for, and no longer needed)

Costs (30K sim)	$/L$	Notes
Cost / month	$259	this is $30 more than the "standard" 20K sim
Cost /year	$3,108	12 x $259
Cost / week	$59.77	(cost / year) / 52
Linden cost / week	L14,405	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L7,203 or L3,601	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (20K sim)	$/L$	Notes
Cost / month	$229
Cost /year	$2,748	12 x $229
Cost / week	$52.85	(cost / year) / 52
Linden cost / week	L12,736	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L6,368 or L3,184	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (5K homestead sim)	$/L$	Notes
Cost / month	$109
Cost /year	$1,308	12 x $109
Cost / week	$25.15	(cost / year) / 52
Cost / week	L6,061	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L3,031 or L1,515	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

 

To summarize: The actual weekly Linden cost of a sim to their owner is:

1. Full 30K sim = 16,022 or 14,405 (after year one and the buy price is paid off)
2. Full 20K sim = 14,353 or 12,736
3. Full 5K homestead sim = 6,753 or 6,061

So, is that 16,999L/week 20K sim worth it to you, the renter, based on the actual cost of 14,353 or less? Now you can better decide.

Again, I've done this not to upset anyone, but to provide information for renters so that they can make more informed decisions about what they are willing to pay for rent. Information makes for better decision-making, and that's my intent with the post.

[Cecilia Dallas]

I love you lots silly one (and thanks for the skybox spaces over time), but you're gonna get it from all sides with this I think  

Hold on tight!

Edited November 2, 2021 by Giselle Kiyori

[Sylvia Tamalyn]

Maybe I missed it, but did you address somewhere in there that one cannot just buy a homestead sim from LL all by itself? You must own a full region as well, so it seems like that might affect your calculations somewhat, if someone is looking at the rent charged on a homestead and saying "rip off!" because they don't understand that the landlord has that higher price sim to pay for as well. 

[Katherine Heartsong]

I did not, specifically, no.

My (unspoken) assumption there was that yes, they would have had to also own a 20K or 30K sim. But that they probably rent that anyway (and if they simply own it to live on to live on it then cost isn't an issue) and therefore they're also making income from that that would be part of their income. I did take into account the cost of purchasing a homestead though in my one year calculations.

My point is to show the cost of a sim for the owner/landlord, and let people then see what those folks are asking in rent and compare the two to make sure they are getting the value they want.

For many people in SL the markup on rentals, especially after owning a sim for a year and paying off the initial buy, is hidden/unknown and that works greatly into an advantage for the landlords. I wanted to strip that mist away and provide information for renters so the playing field is a bit more level. The more informed a consumer is, the better decision they can make for themselves.

My example question re: a quantitative comparison that people should consider ... if a sim owner has held onto a 20K sim for a year, and they are charging you the equivalent of $305 for a month's rent (16,999 x 52 / 12 / 241) for something that costs them $229, do you feel as a renter that's okay? And the profit is higher than that $76 if they are renting portions, since I have yet to see a landlord simply break that 16,999 into four rents of L$4,250 if you are renting a quarter sim, it's often L$5,000 for a quarter sim ... or a total rent of that $229 sim of $359.

 

Edited November 3, 2021 by Katherine Heartsong

[Finite]

I thought most who buy sims to profit off of renting buy the grandfathered sims? 

[Marianne Little]

Running a rental business in SL, tenant pack up and leave suddenly and you can't rent it out for a week or a month. Does that mean your rental price was too high?

Not necessarily. SL is fluid and people quit over small arguments, break up, leave SL, loose interest...

If a landlord isn't doing it as a hobby and happily cover those weeks and months, then they add in a buffer, I would assume.If landlord does not get in enough rent, if he/she was optimistic and counted on 100% of the parcels rented out all the time, it ends with the region abandoned and all tenants has too move.

I would think the landlords want a profit too, not just go even.

Edited November 3, 2021 by Marianne Little
typo

[Exavor Diesel]

13 hours ago, Marianne Little said:

Running a rental business in SL, tenant pack up and leave suddenly and you can't rent it out for a week or a month. Does that mean your rental price was too high?

Not necessarily. SL is fluid and people quit over small arguments, break up, leave SL, loose interest...

If a landlord isn't doing it as a hobby and happily cover those weeks and months, then they add in a buffer, I would assume.If landlord does not get in enough rent, if he/she was optimistic and counted on 100% of the parcels rented out all the time, it ends with the region abandoned and all tenants has too move.

I would think the landlords want a profit too, not just go even.

This is a major point. Land can sit unoccupied for weeks or months before it is rented again, meanwhile the landlord has to pay tier or maintenance on their land usage while not receiving any income. These costs are real and unfortunately they have to be recovered somehow. Landlords cannot simply absorb all costs and nor should they be expected to.

I appreciate the OP noted that some landlords have to pay VAT but do not appreciate that the OP excluded these from her calculations. Not everyone lives in the USA and VAT is applicable to most if not all member states within the European Union. Similar taxes are also applicable in some non-member states too. I too have to pay VAT which means my tier costs me an additional 20% each month. 

[Chic Aeon]

Well THAT was a lot of work to do!

 

Aside from the can't own a homestead without a full sim issue which you acknowledged there is a giant elephant in the room which you may not even know  about.   The big land owners (land baron types) don't PAY the published rate that small owners do.  AFAIK no one has ever published the costs that they do pay. That may be an NDA thing OR it is very likely that the costs are not consistent even among land baron types -- different deals for different folks.  I have absolutely NO INTEL on the amount.    

 

The second questionable statistic (to me) is using the cost of BUYING lindens as your benchmark.  Assuming the landlord is using the rental fees as RL income they will not only have to convert BACK to linden dollars to pay the tier (and that is a pretty heft charge)  -- if they want to process their USDs out to Paypal there will be MORE charges (even heftier).   So looking at this only from the renter's cost point of view seem unfair to me.  A middle ground number between costs to buy and cost to sell and process would seem both more logical and more fair.

 

Let's look at my  my Moon Beach sim for example:

--- I pay $6488 a week (a homestead sim). I have been here well over a year and I am perfectly happy.  No hassles at all. I haven't even contacted the owners. And I rented another sim from the same people before that.  This was NOT the cheapest parcel  that I could find, but the less expensive one came with a  hill surrounds with bad  LODs and was "landscaped". I wanted a blank slate.     

 

So using your idea of Linden conversion that is   6488 minus 6061 which is somewhere in the $1.30US area (quick and dirty math) WITHOUOT TAKING INTO ACCOUNT conversion back to USDs and the fees for processing payment.   So VERY loosely that is $5.00 and change a month per sim.  And most of the larger land places have overhead to take into consideration too.  That's not a lot of profit as "published prices".  

 

    The last point probably isn't all that important to most folks but the reason that "I" am renting is the Tilia part of the equation.  I have yet to agree to the use and privacy policies and I have no plans to.  What I have  here now is a "savings account".  Should I ever be desperate (I don't foresee that but who knows) I may decide to give The Lab my SSN (granted they might already have it but "I" didn't give it to them and to me that is relevant). I may decide to cash out.   Until then it is just play money for awhile.   

 

 

 

 

Edited November 3, 2021 by Chic Aeon
moved a paragraph for better clarity

[Stephanie Misfit]

17 hours ago, Marianne Little said:

Running a rental business in SL, tenant pack up and leave suddenly and you can't rent it out for a week or a month. Does that mean your rental price was too high?

Not necessarily. SL is fluid and people quit over small arguments, break up, leave SL, loose interest...

If a landlord isn't doing it as a hobby and happily cover those weeks and months, then they add in a buffer, I would assume.If landlord does not get in enough rent, if he/she was optimistic and counted on 100% of the parcels rented out all the time, it ends with the region abandoned and all tenants has too move.

I would think the landlords want a profit too, not just go even.

Yes, I've always assumed that landlords have a buffer, higher prices to account for times that land will be vacant. How many landlords would have 100% occupancy, and tenants who don't run off unexpectedly?

In the case of estate rentals of smaller parcels, I know that I have rented 1/8 and 1/4 sims and it's just been me or maybe one other person the whole time I was there. That is a huge cost for a "greedy landlord" to swallow. With full sim and homestead rentals, who knows how many the landlord has vacant at certain times that he or she is paying tier on for no return.

I don't begrudge landlords for trying to run a business. I do really wish though that we could buy homesteads or a similar product without needing to own a full sim (though that might have a damaging effect on the mainland).

 

[Prokofy Neva]

On 11/2/2021 at 5:11 PM, Katherine Heartsong said:

I am coming at this from a simple view of costs. I've considered renting larger parcels a number of times over the years, and while I am happy to allow for a certain amount of profit, I do get my knickers in a twist when it comes to landlords who are charging a bit more than seems fair.

Granted, everyone's definition of a "fair profit" in SL land dealings will differ (mine's about 10-12% if anyone's interested), but all I hope to do with the numbers below is inform potential renters ... who are looking to rent whole sims, half sims, or quarter sims ... what the cost of owning actually is in Lindens per week for the sim owner/landlord, and let you (the renter) make up your own mind if the prices they are asking in rent is fair to you. I've not seen this sort of guide before, so wanted it out there for transparency's sake.

I really want to stress that I've done this not to upset anyone, but to provide information for renters so that they can make better-informed decisions about what they are willing to pay for rent. Information about the actual costs makes for better decision-making by buyers, and that's my intent with the post.

Here are the basic things my calculations are going to be based on:

1. Using US$ for all my calculations.
2. Assuming the landlord is in the United States, and that VAT does not apply to their sim fees
3. Full (30K) sim cost = $349 to buy (one-time fee), $259/month
4. Full (20K) sim cost = $349 to buy (one-time fee), $229/month
5. Full (5K) homestead sim cost = $149 (one-time fee), $109/month
6. Current exchange rate (Nov 2, 2021) = $1 = L$241 (excluding $1.49 transaction fee)
7. For Linden calculations I always round to the nearest full L.

Important note here: I am going to do and then show two sets of figures:

1. Taking the cost of buying a sim and including that over the first 12 months of sim ownership. For example, in the case of the 20K full sim, that will mean the $349 is rolled into the full year of $229/month.
2. A second set of calculations that is for year two onwards, when the initial sim buy is all paid out, and therefore does not affect the cost of the sim ownership for the landlord any longer.

Finally, before anyone reminds me, I'll clarify two more points ... I am not taking into account any support costs, because these can range from none at all needed (if you have an even basic idea of landscaping, giving group memberships to other users, etc, to full on "what's a land impact?" types). And also I'm assuming flat grassland/sand sims being rented without extensive custom landscaping. Again, this one is tricky in that once a template is made for terrain shape (RAW file) and or landscaping, it's a simple task to duplicate these over and over, so the cost is largely in the landlord's initial effort.

I may get flack for taking both of these out of my equations, and I agree these are valid points to take into account, but my goal is to to show only quantitative costs, since both of these points (support, landscaping) are something a landlord/tenant will place a qualitative Linden value on, and the potential renter can agree or not that these two things are being offered at what they consider to be fair amount. But with my info below, the renter will know the exact costs for the landlord, and can make the purely qualitative judgements using their own metrics.

However on the flip side ... and again this bugs me a bit ... I have not met any landlords who offer to discount the rental price after a year of them owning a rental sim despite having made back their initial purchase price. In other words, landlords are often making much more rent profit after the first year without passing those saving onto their tenants. Please point me in the direction of those landlords who do though, if you know of any!

So, let's get into the math

Year One (where I amortize the costs of buying the sim into the numbers)

Costs (30K sim)	$/L$	Notes
Buy	$349	initial buy for a full sim
Cost / month	$259	this is $30 more than the "standard" 20K sim
Cost /year	$3,457	including the Buy price, thus = $349 + (12 x $259)
Cost / week	$66.48	(cost / year) / 52
Linden cost / week	L16,022	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L8,011 or L4,006	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (20K sim)	$/L$	Notes
Buy	$349	initial buy for a full sim
Cost / month	$229
Cost /year	$3,097	including the Buy price, thus = $349 + (12 x $229)
Cost / week	$59.55	(cost / year) / 52
Linden cost / week	L14,353	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L7,177 or L3,588	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (5K homestead sim)	$/L$	Notes
Buy	$149	initial buy for a homestead sim
Cost / month	$109
Cost /year	$1,457	including the Buy price, thus = $149 + (12 x $109)
Cost / week	$28.02	(cost / year) / 52
Cost / week	L6,753	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L3,377 or L1,688	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

 

Year Two+ (where the initial purchase cost of the sim is paid for, and no longer needed)

Costs (30K sim)	$/L$	Notes
Cost / month	$259	this is $30 more than the "standard" 20K sim
Cost /year	$3,108	12 x $259
Cost / week	$59.77	(cost / year) / 52
Linden cost / week	L14,405	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L7,203 or L3,601	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (20K sim)	$/L$	Notes
Cost / month	$229
Cost /year	$2,748	12 x $229
Cost / week	$52.85	(cost / year) / 52
Linden cost / week	L12,736	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L6,368 or L3,184	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (5K homestead sim)	$/L$	Notes
Cost / month	$109
Cost /year	$1,308	12 x $109
Cost / week	$25.15	(cost / year) / 52
Cost / week	L6,061	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L3,031 or L1,515	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

 

To summarize: The actual weekly Linden cost of a sim to their owner is:

1. Full 30K sim = 16,022 or 14,405 (after year one and the buy price is paid off)
2. Full 20K sim = 14,353 or 12,736
3. Full 5K homestead sim = 6,753 or 6,061

So, is that 16,999L/week 20K sim worth it to you, the renter, based on the actual cost of 14,353 or less? Now you can better decide.

Again, I've done this not to upset anyone, but to provide information for renters so that they can make more informed decisions about what they are willing to pay for rent. Information makes for better decision-making, and that's my intent with the post.

I'm going to take your word for it just glancing at the basic numbers, but I don't rent out islands or homesteads for the most part so I can't speak to all the claims. I have one grandfathered island and one homestead; I charge $1/prim on the former ($1300/1300 for a 4096) and on the latter, I charge exactly what it costs me for a grandfathered homestead. Why? Because it's a very competitive market. So these prices are nothing like Mainland and I don't have the time to spell out all the issues on Mainland and their costs, but island or mainland, I have one word for you: Occupancy.

The profit that you apparently find appalling, although you say it's education, is the case if there is 100% occupancy. So in abstract terms, you may look at a sim and imagine the owner has "only" that tier to pay and since he has "all these rentals" it's price gouging...but does he? Every month? Year after year?

Even at 85% occupancy, the losses become so great that you are driven out of business unless you are willing to lower prices, cut costs, or put in your own money.

100% occupancy is a dream you rarely find in SL, even on Blake Sea, even in furry communities that have existed for 20 years.

Should land lords charge you this kind of price because they can't keep their rentals filled? Well, I guess they have to? and there is enough variety in SL that you don't *have* to rent from those charging a lot.

[Prokofy Neva]

6 hours ago, Stephanie Misfit said:

Yes, I've always assumed that landlords have a buffer, higher prices to account for times that land will be vacant. How many landlords would have 100% occupancy, and tenants who don't run off unexpectedly?

In the case of estate rentals of smaller parcels, I know that I have rented 1/8 and 1/4 sims and it's just been me or maybe one other person the whole time I was there. That is a huge cost for a "greedy landlord" to swallow. With full sim and homestead rentals, who knows how many the landlord has vacant at certain times that he or she is paying tier on for no return.

I don't begrudge landlords for trying to run a business. I do really wish though that we could buy homesteads or a similar product without needing to own a full sim (though that might have a damaging effect on the mainland).

 

It's not that the homesteads would have a damaging effect on the Mainland, because there are a lot of people for whom they are just too expensive. For those who can afford them, they have their limitations -- not enough prims, more easily laggable, etc.

It's that if the Lindens free up homesteads, land barons will buy bunches of them and flip them, give estate rights to the tenants, and go off and play Fortnite, leaving the Lindens with customer service which does occur as a need more often that you imagine. The Lindens went through this already originally with the Void sims; they then decided they don't want to be CS for your fabulous rentals biz and stopped it. Plus the wear on resources was big. If the Lindens claim that what seem like "only a few dozen sims" as void sim filling water between Mainland and Bellisseria or some other continent as  "burden" and "costly,"  then you can see that what they would get in terms of thousands of homestead orders as a burden.

[Prokofy Neva]

On 11/2/2021 at 9:31 PM, Katherine Heartsong said:

I did not, specifically, no.

My (unspoken) assumption there was that yes, they would have had to also own a 20K or 30K sim. But that they probably rent that anyway (and if they simply own it to live on to live on it then cost isn't an issue) and therefore they're also making income from that that would be part of their income. I did take into account the cost of purchasing a homestead though in my one year calculations.

My point is to show the cost of a sim for the owner/landlord, and let people then see what those folks are asking in rent and compare the two to make sure they are getting the value they want.

For many people in SL the markup on rentals, especially after owning a sim for a year and paying off the initial buy, is hidden/unknown and that works greatly into an advantage for the landlords. I wanted to strip that mist away and provide information for renters so the playing field is a bit more level. The more informed a consumer is, the better decision they can make for themselves.

My example question re: a quantitative comparison that people should consider ... if a sim owner has held onto a 20K sim for a year, and they are charging you the equivalent of $305 for a month's rent (16,999 x 52 / 12 / 241) for something that costs them $229, do you feel as a renter that's okay? And the profit is higher than that $76 if they are renting portions, since I have yet to see a landlord simply break that 16,999 into four rents of L$4,250 if you are renting a quarter sim, it's often L$5,000 for a quarter sim ... or a total rent of that $229 sim of $359.

 

I find it annoying to see islands (or worse, even homesteads) divided into 16 flat white sandy pancakes with the kind of rents you mention and an absentee landlord. I call these IHOP sims. People shouldn't rent from them and keep shopping -- but then, they often have the lowest prices (because the worst service.)

The customers get irate because problems develop, disputes between tenants develop (there are more of those than any problems with Lindens and their service), everybody has a story why their rent is late, etc. But there is no hands-on managing. Sometimes you look at the group and its founder/owner and find they are no longer even in SL or at least not in the People list. It's distressing. On the other hand, I see sims where the managers put in all this time and effort and I know it costs them. I spent four hours editing a house for a customer she then deleted. I did this because every once in awhile, I need to prove to myself the maxim that insane customer service demand is endless, and rudeness the only weapon you have against it. Accommodating it politely invites more; setting rules limiting it only invites whining and wheedling. This is why I have self-service and tell people who have taken an hour of my time that if at any time they are unhappy with the service they have served themselves, they can refund.

In real life, people drink overpriced lattes that cost $4.59 and aren't troubled at the markup involved from the lowly earnings that a Latin American coffee farmer gets much less high-priced Manhattan rents. They see it as "the cost of doing business". In SL, people constantly complain about prices of rentals even as they pay $2000 for a body or $3000 for a tree fat pack. It's all in what you value.

[Prokofy Neva]

10 hours ago, Chic Aeon said:

Well THAT was a lot of work to do!

 

Aside from the can't own a homestead without a full sim issue which you acknowledged there is a giant elephant in the room which you may not even know  about.   The big land owners (land baron types) don't PAY the published rate that small owners do.  AFAIK no one has ever published the costs that they do pay. That may be an NDA thing OR it is very likely that the costs are not consistent even among land baron types -- different deals for different folks.  I have absolutely NO INTEL on the amount.    

 

The second questionable statistic (to me) is using the cost of BUYING lindens as your benchmark.  Assuming the landlord is using the rental fees as RL income they will not only have to convert BACK to linden dollars to pay the tier (and that is a pretty heft charge)  -- if they want to process their USDs out to Paypal there will be MORE charges (even heftier).   So looking at this only from the renter's cost point of view seem unfair to me.  A middle ground number between costs to buy and cost to sell and process would seem both more logical and more fair.

 

Let's look at my  my Moon Beach sim for example:

--- I pay $6488 a week (a homestead sim). I have been here well over a year and I am perfectly happy.  No hassles at all. I haven't even contacted the owners. And I rented another sim from the same people before that.  This was NOT the cheapest parcel  that I could find, but the less expensive one came with a  hill surrounds with bad  LODs and was "landscaped". I wanted a blank slate.     

 

So using your idea of Linden conversion that is   6488 minus 6061 which is somewhere in the $1.30US area (quick and dirty math) WITHOUOT TAKING INTO ACCOUNT conversion back to USDs and the fees for processing payment.   So VERY loosely that is $5.00 and change a month per sim.  And most of the larger land places have overhead to take into consideration too.  That's not a lot of profit as "published prices".  

 

    The last point probably isn't all that important to most folks but the reason that "I" am renting is the Tilia part of the equation.  I have yet to agree to the use and privacy policies and I have no plans to.  What I have  here now is a "savings account".  Should I ever be desperate (I don't foresee that but who knows) I may decide to give The Lab my SSN (granted they might already have it but "I" didn't give it to them and to me that is relevant). I may decide to cash out.   Until then it is just play money for awhile.   

 

 

 

 

I have always heard dark rumours that land barons with more than 100 sims, or more than X sims, get a secret bulk discount. I have heard this from people with lots of sims, but not that many.

And why shouldn't they? In real life, most companies have bulk discounts and discounts

It amazes me that people who sell dresses and other things with customer service plans that are constantly chatting at you, "Spend $17,000 more with us and get up into the 2% discount level!" (they are always impossible like that LOL)-- find it somehow obscene that somebody in the island business, which is much more customer service intensive, gets a deal from the Lindens. Of course they get a break, and they deserve it.

But what is that number? More than 100? Or more than 50? More than 10? (nope, nothing there, the only discount I know is the public one, where after the first sim the rate is lower, but you have steep tier levels and it's annoying then to add a small amount between the tier levels).

And what kind of discount? It can't be that great; these prices exist to make Linden a profit after their own server costs to AWS, and that's fine.

So I'm not sure it exists, and frankly, I think if it did, we would know about it by now. Could it exist not as a numeric, but a practice only for certainly very beloved FIC? Sure. Just like dressmakers or artists will send you a free item now and then as you are a loyal customer. But how much? How often/

If it is indeed numeric, they should publish it -- it might help business and transparency is always good. So I tend to think it exists only in the form of a few special deals. I think the lion's share of the average island landlords don't have special deals. Those above 100 sims probably do have a deal. Yet people continue to compete against them. Why do you think that is?

[ChinRey]

9 hours ago, Prokofy Neva said:

But what is that number? More than 100? Or more than 50? More than 10?

More than 100. I happen to know of a group that bought 100 private regions to start a new rental business a few years ago and they did not get any special price. Needless to say, that venture didn't last long.

 

9 hours ago, Prokofy Neva said:

And what kind of discount? It can't be that great; these prices exist to make Linden a profit after their own server costs to AWS, and that's fine.

Nobody knows but it may well be very great. Judging by the prices from a commercial opensim grid (no name mentioned of course) that also happens to use AWS, hosting a fairly low traffic residental region shouldn't cost more than 20 USD/month, possibly less than 10. LL has other expenses too of course but even so, there's no doubt that LL has lots of room for discounts to big customers.

[Prokofy Neva]

18 minutes ago, ChinRey said:

More than 100. I happen to know of a group that bought 100 private regions to start a new rental business a few years ago and they did not get any special price. Needless to say, that venture didn't last long.

 

Nobody knows but it may well be very great. Judging by the prices from a commercial opensim grid (no name mentioned of course) that also happens to use AWS, hosting a fairly low traffic residental region shouldn't cost more than 20 USD/month, possibly less than 10. LL has other expenses too of course but even so, there's no doubt that LL has lots of room for discounts to big customers.

Why is it that these open sim projects always tell us they are paying $5 and charge us only $1, always fail? They ought to be literally doing a land office business.

 

[ChinRey]

3 minutes ago, Prokofy Neva said:

Why is it that these open sim projects always tell us they are paying $5 and charge us only $1, always fail?

Because the owners can't do the math.

The one I was talking about has been around for more than a decade though and seems to be doing fairly good business charging 15 dollars a month for a SL style sim.

[yestothis]

On 11/2/2021 at 5:11 PM, Katherine Heartsong said:

I am coming at this from a simple view of costs. I've considered renting larger parcels a number of times over the years, and while I am happy to allow for a certain amount of profit, I do get my knickers in a twist when it comes to landlords who are charging a bit more than seems fair.

Granted, everyone's definition of a "fair profit" in SL land dealings will differ (mine's about 10-12% if anyone's interested), but all I hope to do with the numbers below is inform potential renters ... who are looking to rent whole sims, half sims, or quarter sims ... what the cost of owning actually is in Lindens per week for the sim owner/landlord, and let you (the renter) make up your own mind if the prices they are asking in rent is fair to you. I've not seen this sort of guide before, so wanted it out there for transparency's sake.

I really want to stress that I've done this not to upset anyone, but to provide information for renters so that they can make better-informed decisions about what they are willing to pay for rent. Information about the actual costs makes for better decision-making by buyers, and that's my intent with the post.

Here are the basic things my calculations are going to be based on:

1. Using US$ for all my calculations.
2. Assuming the landlord is in the United States, and that VAT does not apply to their sim fees
3. Full (30K) sim cost = $349 to buy (one-time fee), $259/month
4. Full (20K) sim cost = $349 to buy (one-time fee), $229/month
5. Full (5K) homestead sim cost = $149 (one-time fee), $109/month
6. Current exchange rate (Nov 2, 2021) = $1 = L$241 (excluding $1.49 transaction fee)
7. For Linden calculations I always round to the nearest full L.

Important note here: I am going to do and then show two sets of figures:

1. Taking the cost of buying a sim and including that over the first 12 months of sim ownership. For example, in the case of the 20K full sim, that will mean the $349 is rolled into the full year of $229/month.
2. A second set of calculations that is for year two onwards, when the initial sim buy is all paid out, and therefore does not affect the cost of the sim ownership for the landlord any longer.

Finally, before anyone reminds me, I'll clarify two more points ... I am not taking into account any support costs, because these can range from none at all needed (if you have an even basic idea of landscaping, giving group memberships to other users, etc, to full on "what's a land impact?" types). And also I'm assuming flat grassland/sand sims being rented without extensive custom landscaping. Again, this one is tricky in that once a template is made for terrain shape (RAW file) and or landscaping, it's a simple task to duplicate these over and over, so the cost is largely in the landlord's initial effort.

I may get flack for taking both of these out of my equations, and I agree these are valid points to take into account, but my goal is to to show only quantitative costs, since both of these points (support, landscaping) are something a landlord/tenant will place a qualitative Linden value on, and the potential renter can agree or not that these two things are being offered at what they consider to be fair amount. But with my info below, the renter will know the exact costs for the landlord, and can make the purely qualitative judgements using their own metrics.

However on the flip side ... and again this bugs me a bit ... I have not met any landlords who offer to discount the rental price after a year of them owning a rental sim despite having made back their initial purchase price. In other words, landlords are often making much more rent profit after the first year without passing those saving onto their tenants. Please point me in the direction of those landlords who do though, if you know of any!

So, let's get into the math

Year One (where I amortize the costs of buying the sim into the numbers)

Costs (30K sim)	$/L$	Notes
Buy	$349	initial buy for a full sim
Cost / month	$259	this is $30 more than the "standard" 20K sim
Cost /year	$3,457	including the Buy price, thus = $349 + (12 x $259)
Cost / week	$66.48	(cost / year) / 52
Linden cost / week	L16,022	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L8,011 or L4,006	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (20K sim)	$/L$	Notes
Buy	$349	initial buy for a full sim
Cost / month	$229
Cost /year	$3,097	including the Buy price, thus = $349 + (12 x $229)
Cost / week	$59.55	(cost / year) / 52
Linden cost / week	L14,353	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L7,177 or L3,588	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (5K homestead sim)	$/L$	Notes
Buy	$149	initial buy for a homestead sim
Cost / month	$109
Cost /year	$1,457	including the Buy price, thus = $149 + (12 x $109)
Cost / week	$28.02	(cost / year) / 52
Cost / week	L6,753	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L3,377 or L1,688	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

 

Year Two+ (where the initial purchase cost of the sim is paid for, and no longer needed)

Costs (30K sim)	$/L$	Notes
Cost / month	$259	this is $30 more than the "standard" 20K sim
Cost /year	$3,108	12 x $259
Cost / week	$59.77	(cost / year) / 52
Linden cost / week	L14,405	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L7,203 or L3,601	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (20K sim)	$/L$	Notes
Cost / month	$229
Cost /year	$2,748	12 x $229
Cost / week	$52.85	(cost / year) / 52
Linden cost / week	L12,736	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L6,368 or L3,184	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

Costs (5K homestead sim)	$/L$	Notes
Cost / month	$109
Cost /year	$1,308	12 x $109
Cost / week	$25.15	(cost / year) / 52
Cost / week	L6,061	in Lindens, see exchange rate above
Cost / week for 1/2 or 1/4 sims	L3,031 or L1,515	(Linden cost / week) / 2 or (Linden cost / week) / 4

 

 

 

 

 

 

To summarize: The actual weekly Linden cost of a sim to their owner is:

1. Full 30K sim = 16,022 or 14,405 (after year one and the buy price is paid off)
2. Full 20K sim = 14,353 or 12,736
3. Full 5K homestead sim = 6,753 or 6,061

So, is that 16,999L/week 20K sim worth it to you, the renter, based on the actual cost of 14,353 or less? Now you can better decide.

Again, I've done this not to upset anyone, but to provide information for renters so that they can make more informed decisions about what they are willing to pay for rent. Information makes for better decision-making, and that's my intent with the post.

In your calculations, where does the sim owner actually recuperate the initial cost of the sim? Many of them don't even realize profit until the 2nd year. Sims now are cheap at $349 to buy in, but it use to be $1600+. People forget small details like this and the exchange rate fluctuates a lot! And to get Lindens out of SL, there's a 1.5% conversion fee, and also a 3% paypal fee.

[Jaylinbridges]

43 minutes ago, yestothis said:

And to get Lindens out of SL, there's a 1.5% conversion fee, and also a 3% paypal fee.

Those are obsolete fees. They are now a 3.5% conversion fee to dollars, and a 5% Paypal fee for the balance transfer. So 8.5% in fees to cash out.  Tillia also makes money on the buy sell spread as the broker, another 1%.

 

Edited November 5, 2021 by Jaylinbridges

[Prokofy Neva]

I think it's helpful to understand that you made this manifesto because you yourself decided to develop a property and rent it out, as we can read from the ads section. Even if technically you are giving boutiques away for "what people can pay," you still get something of value.  Not every value in SL is calculated in literal Lindens, so you get value from starting a shopping mall in other ways -- sales of your art, appreciation of your role in the community, etc.  It's not just that you are having an abstract discussion and lamenting in a theoretical way -- you're going into the development business yourself (whether for profit or not is not the point).

So this post, regardless of your sincerity, can only be seen as an advertisement that you would be different than all these other rapacious landlords -- and undercut them, by giving away stores to top designers.  And that you would also find the cheapest landlord to rent from, as you yourself didn't want to buy an island. No doubt you shopped around and even moved once after posting your notices so you were in quest of a better deal. 

And that can only be applauded, if you or others set out to make a more ethical renting system, or a philanthropy for quality creators,  but then after advertising your rentals on one location, you realized you didn't have enough prims, then bought another location -- and maybe you are starting to realize this isn't so easy and people charge a lot for a reason.

All that's fine, and even to be praised -- it's ok to learn by doing and more people should pay attention to all these issues than they do. But it does put your manifesto in context. And I have to say, after you walk a mile in the shoes that all of us have had to walk in, especially on Mainland, you might grow to have more respect and less scorn for people you view as greedy and rapacious cut-throat sharks -- that scorn is evident in your original post.

They've been through what you're going through now, and it has cost them a lot sometimes, and maybe they couldn't afford to be generous --  and it burned them out completely.

You write:

"I really want to stress that I've done this not to upset anyone, but to provide information for renters so that they can make better-informed decisions about what they are willing to pay for rent. Information about the actual costs makes for better decision-making by buyers, and that's my intent with the post."

You want THEM to be transparent or the entire industry to "become transparent" on the forums (not the best place); you're mad you had to pay high prices. Yet you didn't tell us that you yourself are now a landlord -- and undercutting other landlords with $0/low prices. That's of course your right, but it puts this exercise into perspective.

I think it's better to discuss this from your own concrete experience, not the abstractions you've concocted.

Your island landlord charges only 0.69/prim ($650/932 prims/2048 m) -- that's very cheap even for Mainland (I will go down to 0.66 or even 0.5 but those are essentially loss leaders, subsidizing newbies or new projects for a time). He has rented all but 2048 m2 so he is doing well. His land is divided into the flat pancakes I don't care for but it doesn't matter, you made your own 1/4 sim very nice and the view of the others is blocked.

If this were mainland, your tier would be US $67 per month if you did not own a whole sim, or US $44 per month as the rate goes down in the tier levels after the first sim, and they appear as quarters of a sim on your account. So if he gets $51.75 for the quarter sim and makes a $7.50 profit -- if it's Mainland, but it isn't. He charges only a nominal fee of L$40 to "buy" land. No doubt you researched him before buying and concluded he wasn't one of these island landlords people fear who flee and dump their lands, making their tenants who "purchased" land SOL.

We don't know what his tier is -- $259? $229 after that "first successful year" as you calculate it? $195 on a grandfathered sim? If he doesn't have a grandfather, he is losing money on 0.69/prim. At 100% occupancy, which he doesn't quite have (minus 2048), he can put together $207. (It's not clear also whether $69/prim is for the smaller lot, which might be cheaper or more expensive than a bigger lot). $207 is not $229 or $259. It's only US $12 over and above the grandfather tier.

That is a very vulnerable situation for you to walk into, unless he's a friend/philanthropist/makes money elsewhere on content or more expensive islands. His margins are too slim, his prices are too low to continue to make this an incentive to keep this place nice, control the clubs which are always unruly, etc.

Yes, I see two problems with this sim -- you are sandwiched between two clubs, one of which regularly had 7-10 green dots stacked up. So that means lag for that sim, and possibly so many avatars, that the spaces are taken up and you have trouble then getting in your customers. It's a vulnerability. Also the script usage is 8,408 active scripts -- no double due to the clubs, which have a lot of scripted items, not to mention the rest of the small lots (2048 each) which use up scripts. Anything above 5000 can start to get laggy. So the price is low, but other people looking for that low price -- clubs -- found it, and they're your neighbours. Neighbours who could hurt your business.

And yes, I realize that you are not even "renting" but giving away boutiques for free -- but only to some select people. And that's fine but you may move from having people "pay what they can" to actually charging more systematically when you see the costs involved and the recurring $51.75 every month. That doesn't seem like much, does it? I wonder why people complain so bitterly about the cost of SL when you can get an entire quarter sim for around $50 without any setup fees from island dealers. Ten friends could put $5 into the kitty each month. It really seems ridiculous to struggle on the Mainland or live in Linden Assisted Linden on a 1024 with 351 prims, complaining about how the Lindens never release standalone homesteads, when you can have a corner of a flat island paradise for $50 bucks. Maybe a little more. But it's out there.

But while your landlord may have virtually no work on this sim, his $31 profit (or is it only $12?) with full occupancy isn't really so terrific. He has cashout fees. He has to spend time administering rentals, buying equipment. He's not likely managing your virtual paradise from his yacht in the Cayman Islands, you know? He's probably a retired postman in Columbus, OH.

Yes, you have reason to scorn land barons from the antics of one in particular in a certain themed community, but I can cite some other use cases just today which are all too common and which make this entire space of the land business just a nauseating mess lately that are far, far worse. 

We've already discussed how vacancy kills the business and makes it all worthless -- quick. If you decide to vet all your tenants for quality or aesthetics as you have indicated  -- which is perfectly fine -- you will discover your land won't rent and your tier won't get paid. And if you give something for less than tier costs you, or even for free, you will eventually resent it, and the people to whom you were so magnanimous. Because they aren't grateful, and won't embark on a mutual favour bank system with you as you might expect. All this is ahead. Be honest about reporting it, please.

So even if you weather the problem of being sandwiched between two clubs, it's better to start a development with your customers already lined up to rent from you, whom you have already cleared -- this is how Anshe Chung did it and how she could take over every telehub  instantly after auction. She even had those customers' store buildings in her inventory to immediately plunk them down if they weren't online.

And it would have been better to gather 10 of your favourite artist friends or best designers you admire -- you know, like that themed community in distress now? And decided together how you would build, allocate, cover costs -- or not. When it's one person who does everything and decides everything, in the future is the clicking of the abandoned button.

Even if you are not charging anything or asking them to "pay what they can," you still will try to optimize traffic, cut costs, etc. And you may not be able to hold back resentment -- and justifiably -- if someone to whom you gave free space then undercuts you elsewhere in the market, or creates conflicts for you and others. There is something about a payment and a set of transparent rules and an open system where anyone can rent if they abide by a set of simple rules that in fact helps avoid the conflicts we see when people with high ideals or aesthetics go about development, scorning all the while those of us with lesser aesthetics and more pragmatic notions.

Life doesn't always go as planned, and I myself have started developments where I was induced to do so because other things went wrong -- the "natural disasters" of the Mainland -- with no tenants. Then I might get one or two. I might have to lower prices below what tier costs. Then I only get others because they've been forced out of other bad situations elsewhere. It is slow and torturous. I'm not kidding when I say that it can take a year to get land you bought paid for -- and even rented -- so you can't claim you are in the black likely for another year. Seriously. Prepare for this or be doomed. It's hard. Tier repeats every month, is merciless, and is not an "investment," it is a sunk cost.

Your idea that landlords who "made back their investment" after a year "should" lower costs for their loyal tenants is not one anyone can take seriously.  Ask any landlord, famous ones known for being creative and ethical such as Desmond Shang, for example. Vacancy is too hard a problem. There are too many unforseen problems. Try having your island down for 3 long days over a long US holiday when the Lindens are gone -- I'm lucky I can at least send my tenants from my one island to my mainland hangouts. Try having to deal with griefers -- clubs attract them. Please report honestly on where you are with this in 30 days, 60 days, 90 days, it's helpful and instructive. 

 

Edited November 8, 2021 by Prokofy Neva

[Prokofy Neva]

On 11/2/2021 at 9:31 PM, Katherine Heartsong said:

I did not, specifically, no.

My (unspoken) assumption there was that yes, they would have had to also own a 20K or 30K sim. But that they probably rent that anyway (and if they simply own it to live on to live on it then cost isn't an issue) and therefore they're also making income from that that would be part of their income. I did take into account the cost of purchasing a homestead though in my one year calculations.

My point is to show the cost of a sim for the owner/landlord, and let people then see what those folks are asking in rent and compare the two to make sure they are getting the value they want.

For many people in SL the markup on rentals, especially after owning a sim for a year and paying off the initial buy, is hidden/unknown and that works greatly into an advantage for the landlords. I wanted to strip that mist away and provide information for renters so the playing field is a bit more level. The more informed a consumer is, the better decision they can make for themselves.

My example question re: a quantitative comparison that people should consider ... if a sim owner has held onto a 20K sim for a year, and they are charging you the equivalent of $305 for a month's rent (16,999 x 52 / 12 / 241) for something that costs them $229, do you feel as a renter that's okay? And the profit is higher than that $76 if they are renting portions, since I have yet to see a landlord simply break that 16,999 into four rents of L$4,250 if you are renting a quarter sim, it's often L$5,000 for a quarter sim ... or a total rent of that $229 sim of $359.

 

Again, if you are going to take on the role of the Better Business Bureau of SL (so many have failed, and for good reason) or just the Consumer Report, then you should cite your own concrete experiences, and not abstractions. Not only your own shopping expedition and current project sim. But anything you've actually seen in world with a SLURL that anyone else can check.

You have no idea if all landlords are charging $305 a month. Do you have the figures for the 20,000 odd islands of SL, how many of them are rentals, how many are grandfathers? It's not like these figures are easy to get. How many islands did you shop at before deciding on your own project island -- which you then had to move once you saw the cost of buildings and how hard your prims got hit?

Some landlords buy those buildings and eat those prims, too, you know? Not all of these islands are flat pancakes divided into 16.

You can't "clear away mist" when you don't have sufficient evidence, and are building an abstraction based on some immediate experience you had of this or that sim. How many sims do you personally know that charge $305 per month?  Did you IM their owner and ask him any details? He may not wish to give them, but if you are going to purport to be doing a public service, you need to gather more data and be more transparent about your own motives -- you need a cheap island for your high-class mall.

And as I've mentioned, your notion that somehow people who worked for no salary (that's how to understand it, and even profit of $2000 per month is not enough to live on in major cities of the US), who absorbed all kinds of hardships and costs, now "owe the public" some kind of lower rent to "give back" what they now have, is simply absurd. They don't. That's how capitalism works -- it's an incentive. These are not NGOs; they are businesses. You can't expect this after spending a year paying off the set-up fee and tier for land that didn't rent -- it's more like 2 years in some cases. Of course as always happens with the forums, there aren't any large island dealers weighing in on what you are portraying as your "Consumer Report" that begs to become a sticky by a Linden. Did you poll them? Did you ask them why they aren't "giving back"? How many?

And how many island dealers in fact have to earn far less, because there are so many hobbyists giving away land and buildings to their friends for free?

You set up the proposition very tendentiously as if we are in a consumer rights battle against deceptive and greedy capitalists. But you're in an experiment of development yourself, and you should report on that honestly.

Edited November 8, 2021 by Prokofy Neva

[Prokofy Neva]

On 11/5/2021 at 12:17 AM, yestothis said:

In your calculations, where does the sim owner actually recuperate the initial cost of the sim? Many of them don't even realize profit until the 2nd year. Sims now are cheap at $349 to buy in, but it use to be $1600+. People forget small details like this and the exchange rate fluctuates a lot! And to get Lindens out of SL, there's a 1.5% conversion fee, and also a 3% paypal fee.

They sure do forget!

In 2004, I paid *US $1501* on the auction for the MAINLAND sim of Ravenglass. (There were hardly any islands back then; they functioned  poorly and those few who bought them complained loudly).

There was no map with point-to-point teleporting, and I had to fly 1,000 meters from the Waterhead Telehub to get to my land. That meant it was harder to rent than others who managed to snag land next to telehubs.

I paid builders to make custom houses before placing land to sale to make them more attractive; this was Philip Linden's innovation at the time, adding the ability to sell builds with land.

Then the people next door put a giant King Kong up in the water, but more relevant, they put a Starax statue of a fisherman being seized by a vulture right in front of one of my first customer's land -- the Lindens water parceling has been a chronic conflict vector. I bought back that customer's land because I was nice enough to build that into all my deals, unlike anybody else. I sold all of Ravenglass except the commons; I ended by buying it all back. That's the reality.

I sold a lot of the parcels but I couldn't say even in the first year that I "made back" $1500. For that, I would have had to sell 16 x 4096, let's say. This sim was not a full 65,536, either; it was coveted for its "Mainland Island" on one edge, and had a very nice Linden cove, but that mean some 7,000 meters of this "full sim purchase" were snipped out of it. But just for the sake of the numbers, look at what I had to resell that land for in theory: US $93 per 4096. That's assuming I would be willing to make an IHOP with 16 pancakes, but this was hilly land, roadside, a cove -- a challenge to parcel and sell. I put 10,000 m2 of park as a commons to make it more attractive and not feel crowded -- there's another cost eaten. I would have to find my notes but I believe I sold in fact 1024 or 2048 parcels -- I had this idea of having a larger community. So there was no "earning back" that $1500, not even after a year. Could I say I did after *15 years in SL*? No way.

Because selling Mainland is risky; people grief it by putting up giant refrigerators and Soviet palaces. If you try to be ethical and offer people buybacks to compensate for their risk, you end up buying back a lot. Then once the islands are perfected, people flee to them, and you are left with a Mainland sim that cost you more than the Lindens then charged for a new island set-up fee at that time: $1200. People forget that island set up fee of $1200 and look at the $349 today.

I then turn to rentals, which are also very difficult with the giant refrigerator, griefers crashing the sim, particle attacks, people putting out orbs when they are not allowed, etc. etc. I couldn't possibly say I "earned back" that $1500 when I had to keep paying tier each month! The tier was *higher* then than it is now. I'd be more than justified never to give back a penny in lower prices but in fact most of what I do in SL is non-profit projects like the land preserve or various galleries in Bellisseria, etc. I have always wanted the commercial rentals to pay for the non-profit ones, and this has become incredibly hard because of the constant devaluation of land by Linden policies of inaction or failure to enforce policies. It took us four long years to get the Linden policy against ad-farm cutting. 

People like me who came after the early beta test love fest (those who got a free 4096 and a special badge on their accounts) did not get any special status or deals or discounts and spent outrageous amounts of money on this boat, if you think of it. It was an experiment for them and us. They are called the Lab. We are called residents, like at an insane asylum. 

Once you have spent US $1500 to build your dream of virtual life, come talk to me. But that was only the beginning -- early in my rentals agency career, I spent US $350 on an 8192 to blow a laggy, obnoxious and griefy club out of the water so that I could have my tenants live in peace in Furness. It would have been nice to stay on one sim. I couldn't, as you must constantly "buy the view".

Edited November 8, 2021 by Prokofy Neva

[Rabid Cheetah]

Yep.  looks like November IS National Novel Writers' Month.

[Prokofy Neva]

 

In 2005, islands were so novel that there was no price list; you had to write to the Lindens and they promised to respond within two weeks. Then they became available on demand.

From November 5, 2006

Small islands are priced at US$1,250 for 65,536 square meters (about 16 acres), monthly land fees for maintenance are US$195.

Large islands are priced at US$5,000 for 262,144 square meters (about 64 acres), monthly land fees for maintenance are US$780.

We offer a discount to verified real world educators and academic institutions (e.g., universities/schools) or 501(c)3 non-profit organizations that will be using the regions to support their organization's official work. For these organizations, small islands are priced at US$980 for 65,536 square meters (about 16 acres), and monthly land fees for maintenance are US$150.

 

Do the large islands still exist? I don't think so. The discount for educators was ended some years ago, and I believe brought back when the pandemic broke out.

For November 5, 2006:

Second Life Time:    8:34 PM PST
Total Residents:    1,243,431
Logged In Last 60 Days:    512,746
Online Now:    13,390
US$ Spent Last 24 Hrs:    641,149
 

[Cube Republic]

I rent my homestead for 6250 a week. The landlord must have a lot of grandfathered stock or perhaps they get a discount from the lab for having a large inventory? 

[Prokofy Neva]

On 11/16/2021 at 10:42 AM, Cube Republic said:

I rent my homestead for 6250 a week. The landlord must have a lot of grandfathered stock or perhaps they get a discount from the lab for having a large inventory? 

The current tier for homesteads is $109 per month, and grandfathered tier is $99 per month. At current LindEx rates, $6250L is US $100. So either he has a grandfathered sim and doesn't mind earning only $1 in profit, or yes, he has a bulk discount -- but no one has ever confirmed this, it's just assumed.

He could also be someone who merely wants to get his costs covered in whole and in part and not seek further profit as he just enjoys providing this service.

Or perhaps he has very lucrative Blake Sea properties or other islands at commercial rates that generate enough profit that he can afford to be generous.

If he is a no-show landlord and has 50 or 100 of these hot cakes to flip, he still has $50 or $100 profit just from them, maybe that's enough.

There are so many different explanations for prices and different configurations of land business in SL that the OP's assumptions of heedless greed on the part of land dealers is misplaced. Sure, there are land sharks making bank in SL. But any SL land business is going to be 10 times harder to run than pages selling jewelry or stock footage or some other Internet business that it seems crazy. And is crazy. 

Edited November 28, 2021 by Prokofy Neva