The most important thing about successful free homesteads is that they don't easily let everyone in. Sorry to say for those who are looking for a free home, but that's the way it is. This can be achieved in two ways.
One is mandatory group membership. And the group has to be invite-only. At least, you have to ask one of the group owners to add you. This is the case with Tropicana, it's also the case with Nautilus IIRC, and it's the case with the various Neverworld homesteads. That way, the group owners can decide for themselves whether or not to let someone in.
This can be combined with mandatory grid membership, i.e. only offering homesteads to grid residents to keep Hypergrid cybersquatters out. But seriously, renting free land on the Hypergrid can only be a last resort at best anyway. You can't even really use it as your home because you can't have your avatar rez outside your home grid upon logging in.
Even the Dune project on Metropolis which consisted of multiple huge sandbox varsims for everyone to settle on and take as much land as they want was group-only. That group was the group of verified grid residents, the one that you had to pay for. Without that group membership, there was nearly no place on the grid where you could rez (except Neovo's changerooms) or set home (except the main landing sim).
Dorenas World goes another step further: The grid itself is invite-only currently. You can't simply make an avatar there. It's up to Anachron and Dorena to decide who joins, and they prefer people whom they actually know, whom they're certain they can trust. Again, only grid members may be assigned a plot of land. And even then you need a group membership to be able to rez which, again, is only given to trustworthy grid residents. The only thing that's missing are rental boxes.
Squatting only happens rarely, if at all, as far as I can see. It's simply too difficult. Some tenants are excused for not showing up at our community events because they're living in a timezone that doesn't allow for it, and all our events are on weekdays. But I think even those living overseas log in and visit their land every once in a while. It does happen that people don't show up anymore for a whole year in which case their plots may be cleared. It also happens that people really stop being interested in living on the grid without saying so, regardless of whether it's because they don't want to hurt the "grid parents" or because they just don't care.
One plot next to mine was cleared only after I talked to the former tenant who had moved elsewhere, didn't want to come back and couldn't even bothered to clear the plot. And I think it hurts the "grid parents" more to find it out through third parties like me.
Getting back to rental boxes, there are various systems. The not-so-good ones let you rent for a whole month, but only for a whole month. There is no way to extend it. You have to either wait until your rental period is over and then re-rent in a relatively short time frame or terminate and re-rent. The former means you have to show up on one specific day out of two or three, the latter is an ugly kludge and may or may not mess up your prim count.
Tropicana and Nautilus use a better variant: You can rent for up to a month in steps of one week, and you can extend to a full month whenever you're home.
The rental boxes I've seen on Neverworld are similar, but with up to three months in steps of one month. I think they can only get away with this because they've got so much land to take that someone neglecting their land for a quarter of a year isn't too bad.
As said earlier, community building is always somewhat difficult because it highly depends on timezones, sometimes also on languages. For example, the community events on Dorenas World all happen on weekdays and usually start at 8:00 PM local time which is rather inconvenient for Americans; in EST, that's early afternoon, in PST, that's before noon even. Vice versa, events that are scheduled for the afternoon or evening in America are past midnight for us. And the language barrier is probably too high between a US-based, English-speaking community and Brazilians who only know Portuguese and even have to run OSW through Google Translate to be able to use it.
I hope the system that Tropicana uses works reasonably well. I remember the times when Tropicana had over 100 rentals, all with buildings on them which made clearing them somewhat more difficult. There were people who came from SL, joined OSgrid (maybe also because that was the only grid they knew), found Tropicana, rented a house, dropped down some stuff, decided that OpenSim sucks (and be it because OSgrid had difficulties) and went back to SL, never to be seen again. Mike and the Tropicana staff had to go around, check expired rentals for remaining objects and remove them if there were any. If you have over a dozen varsims with over a hundred rentals, that's truly tedious.
Even the Tropicana system only works as long as Mike knows which parcel is rented and by whom. You could theoretically ask Mike for a group membership, rent a parcel and then not tell him what you've rented because you've stopped reading or following the notecard at the point where you got your piece of land. Then the Tropicana staff will have to go around and try to find out for himself what you've rented. And Tropicana is building more and more rentals again, many being islands on varsims.
This is easier for Anachron and Dorena. They only offer a few parcels on two standard regions, both connected to the mainland with its street network. They know who lives where because they decide who lives where. And they can easily see if someone has built something because the parcels are empty by default.
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