Justice Soothsayer wrote:Let's talk about the practical implications for CDS. How does the reduced price for islands impact our expansion plans? Should we charge less for land? With islands now more affordable, will it change the market for folks considering joining us?
Good questions.
The most important note is that in the history of the CDS we have never given much thought to the price of land in other "comparable" areas of SL. There ARE no other comparable areas of SL.
Rather, as we have acquired each sim, we have calculated the price we must charge for each square meter of land based on the number of available square meters that we have allocated for private ownership. Using this number (divided into the total number of square meters on a sim: 65,536), we have arrived at a parcel sale price which will provide us with enough money to cover the purchase of the sim, plus a small margin (about 15% - 20%) which enables us to cover any shortfall we might experience because tier becomes due before all the land is sold, or, heaven forbid, some owner doesn't pay their tier.
In Jack Linden's post ( http://blog.secondlife.com/2008/04/07/q ... ng-update/ ) he indicates that mainland land averages about L$11/sqm and island land about L$3.6 (seems like an awfully big difference!). The original sale price, which is also the price that we sell abandoned land, in Neufreistadt was about L$8.3/sqm. Remember that Neufreistadt was bought before the sim price went up to US$1675... we paid US$995 for it.
I think our policy has worked well for us, and I think that means that if we end up paying US$1000 for a sim, our initial offerring price will reflect that. Most people here will end up buying from other residents anyway... and hopefully the market will set the rates, rather than the LL price tag. But as I said in my earlier post, their move does make the owners' assurance of a good resale price a bit more shaky... at least for awhile. Pray to god they do not make many more such drastic changes.
Bottom line is that as far as the factors for new residents, its probably important to have policies which try to minimize the issue of high land cost. If the marketplace pushes the resale price of land too high (i.e. if we are considered an extremely desireable and chic place to live, and our land prices skyrocket as a result), we can always add new land, or else subsidize the prices so that the seller gets what they want, and the buyer doesn't have too high a price to pay.
So yes, I would say that if we buy a new full sim for US$1000, our initial offerring price should be lower than if we had to pay 1675. The CDS adds to its coffers nicely through the resale of abandoned land, but in the long run thats not our business. I would say that fairness dictates that we look for a simple one time return on our investment in land, and look for the growth in the underlying financial stability of cash reserves in the tier that the citizenry decide to tax themselves (over and above the tier due to LL).
Sudane..................
that the price has gone down, and I suppose I would be unhappy if we shelled out $1625 last week for Alpine Meadows only to be told if we had waited a bit we could have got it for a lot less. But overall, darn good news for CDS.
