D3 Auction House Blues

Diablo 3 has been unleashed and it is wreaking havoc on our sales because so many that play WoW have gone to the dark side to play Diablo 3.  Mists of Pandaria is on the horizon, most progression raiding has come to a halt and now the release of Diablo 3.  It is the perfect storm!  Sales have slowed, prices have fallen and for those that are willing to invest in the market, there will be plenty of opportunities to buy, buy, buy!

This particular combination of events has combined to give us a unique look into supply and demand at work.  Most people know that when supply is high and demand is low then prices fall, when supply is low and demand is high then prices rise.  A lot of people don’t know what happens when supply and demand meet in the middle, this is called equilibrium.  Basically this means that we have hit an unusual point in time in the AH, where we see the equilibrium of prices for the goods we sell because the demand and the supply are balanced.

This also means that we are about to shift, meaning that the market is about to move in a direction from here based on the laws of supply and demand.  The question is whether it goes up or down.  I believe that prices are about to down because I see demand slowing for a while and supply rising. 

This is considered a tipping point.  Why do I think this?  Diablo 3 will keep people busy for the next few weeks, and then slowly they will come back to WoW and put more time into WoW, we have seen this before so the pattern has already been established.  But raiding will still be slow, so what do people do when raiding is slow?  They start ALTS!  That’s right, more toons!  Most people think this means demand will go up on items, and it is true we will see some spikes here and there, but many of these toons will will have farming professions of mining, herbalism or skinning.  That’s means we will see supply increase for all levels, demand will not catch up and prices will drop.

Oh, and one more thing, summer is here which means kids are out for the summer and they will be logging in more than ever to play which will also increase supply.

I see the following weeks as an opportunity to stock up when prices are at low points, in many cases these low points have not been seen since last expansion.  Relist when the opportunity presents itself but do not go overboard because you will find that there will plenty of others listing under your price.  Do not let this discourage you, be smart, buy smart and stock up!