In the virtual real estate market, there are land owners who operate their estates as profitable businesses and those who do not. For the land buyer, it is important to understand this distinction, since an estate that is not profitable could disappear at any moment, resulting in a lost investment for the buyer. 

 

 

1- If you were to buy a full prim region (65,536 sqm with 15,000 prims) from Linden Lab® that region will cost you $1,000 USD. This applies to every single person wanting to buy a full prim region from Linden Lab®.

 

2- Here at the Costa Rica Sims, we do not profit from the land sales, we only recover the initial investment of $1,000 USD in order to buy another region and keep expanding our estate. Our revenues come from the tier fees. 

 

Here is an example of how the math works: 

 

$1,000 USD = approximately 270,000 L$.

 

A full region (65,536 sqm with 15,000 prims) is typically divided into 8 parcels of 8,192 sqm with 1,875 prims each.

 

The price for each of these 8,192 sqm parcels is typically 32,500 L$ or approximately $125 USD and includes the tier fee of 15,400L$ for the month. Note this approximation is due to the currency fluctuations in the market for linden dollars™.

 

If you multiply $125 USD by the 8 parcels, you get the total cost of $1,000. This means selling all 8 parcels of 8,192 sqm with 1,875 prims recoups the initial investment by the estate owner. This also means that we do not charge for the hours we spend subdividing, terraforming and landcaping a region before we put it up for sale.

 

 

Do you know of any successful business that would buy a product only to resell it at a cheaper price?

 

Do you think a company investing in X product and having losses is it a safe place to invest your money? 

 

Would you put your money in a bank in real life knowing that the bank is reporting losses every single month?

 

Would you invest in a real estate project when the owners of the project are losing money every month?

 

How long do you think this bank or real estate project will last until the owners call it quits and take everything you have invested with them?

 

 

4- The barriers to entry and the resources needed to create a Real Estate business in SL are low. This means that Real Estate businesses that do not have stable revenue streams can thrive for a short period of time before basic economic principles lead to their failure. Additionally, individuals who have no knowledge of the industry or how to run a Real Estate business can set up shop at anytime. When you see land being sold for 1L$ and similarly low tier prices, it is being sold for a price that will not generate a profit. This means the estate is being supported by the estate owner, not by the sales of land or the tiers. What this means for the land buyer is that the existence of the estate is more at the will and finances of the estate owner, not the residents who own the land. This poses greater risk for the land buyer since the estate will not be able to withstand changes in the market without a revenue stream and profits. Lastly, some of these 1L$ regions are on a class 4 servers, not on a class 5 server like all sims in our estate. This difference in class equates to a difference in performance and lag in the sim. The lower the class, the higher the lag and the lower the performance.

 

 

The Costa Rica Sims Estate is a viable and profitable business with land prices that are competitive with other estates offering similar services. In addition, we offer amenities and environments that are unique to SL, further reinforcing the added value of our estate in comparison to others.

 

So next time you are offered a 1L$ piece of land think about it and remember that every single person that wants to buy a sim from Linden Lab needs to pay $1,000 USD, which means that you are probably getting something for free with a lot of hidden costs, including lost land, lost prims, lost time, lost work, and lost trust.

 

Love & Light,

 

CEO

Costa Rica Sims