Domain Flipping: Our Tips For Buying and Selling Domain Names For Profit

written by

Joe Uddeme

Joe Uddeme

Domain Flipping: Our Tips For Buying and Selling Domain Names For Profit

What Is Domain Flipping?

Domain flipping is the simple practice of buying a domain name for as low as possible and selling it for as high as possible. The idea is to buy a domain, hold onto it for some time, and sell it at a profit.

People invest in all sorts of assets like real estate, stocks, commodities, and bonds. A domain is another “alternative asset” that you can successfully invest in if you have the patience and skills to pick the right domain names.

You may have heard stories about domains that were purchased 30 years ago for $100 and are now being sold today for millions. Sounds amazing, but is it really as low odds as winning the lottery? Or is it easier than that?

In this article, we go over some tried and true tips you need to help you start making money by buying and selling domains.

Go-To Tips For Buying and Selling Domain Names For Profit

When it comes to trying to make money with domains, it pays off to know what you’re doing. Read through some of our tips and suggestions to get you pointed in the right direction.

Set Your Budget

Define a budget that’s suitable for investing in domain names. While some people can spare only $100, others have no worries investing $10,000. The rule of thumb is to only invest an amount you can lose without headaches. Every investment carries risks, so avoid putting critical amounts into assets.

Look For Names That Have Value

Simply put, you want to find domains that would be a valuable asset to your buyer.

If you were buying a domain for your business or company or hobby, what would you look for? Is the domain you just bought something that you would actually use? Try to put yourself in the buyer’s position to make sure that any domain you buy is actually something that will have value.

It is also helpful to stick to an area that you’re familiar with. Remember to ask yourself, what kind of domains are other people in this industry buying? Would you buy this name if you were in that position? How much would this domain help them get found online or give them authority in their industry?

The top-level domain (TLD) also contributes significantly to a domain name’s value. “.COM” is the most common TLD, and domains ending with this suffix tend to be more valuable than others because of high demand. However, there are other valuable TLDs, such as .NET, .CO, .CC, and .ORG.

What are the best types of domain names to buy?

The types of domains that increase your chances of succeeding in domain name flipping include:

  • Local: Domain names tied to specific locations, e.g., cities and towns, tend to have higher demand than others. You should target such domains because you’re more likely to find a willing buyer and make money flipping domains. For example, if you reside in Caldwell, you can target domain names like Caldwellcoffeeshop.com, Caldwellrestaurant.com, Caldwellbakery.co, etc.
  • Short: Shorter domains command higher prices than longer domains because they are easier to remember. Customers find it easier to recall shorter domains, so businesses are willing to pay more for them.
  • Keyword-Focused: Domains containing keywords are more likely to sell than those without. Look for domains containing keywords about different businesses and services, e.g., AffordablePlumbing.com, CheapPhoneRepairs.net, CarRepairs.com, etc.

Stay Focused

You’re aware that there are already millions of domains registered. But there are also endless combinations of available domains to register. If you’re looking for a key tip in regards to buying and selling domains for profit, you should start by narrowing your focus a little bit.

Like we mentioned above, you should start by thinking about a topic or industry you’re already familiar with. Are you in the healthcare industry? Do you love cars or animals? Your job of searching for domain names gets a lot easier if you already know about the topic, because you already have an understanding of the value.

Here’s something you should not do: Don’t just target buyers based on who you think might be wealthy. If you’re only targeting lawyers or doctors because you think they’ll have more money, you might be missing an opportunity in an area you know better. Also, if you don’t have knowledge of that industry, you might end up buying domains without knowing there are industry-specific rules that limit buyers.

Our advice is to stick with what you know. If you stay focused on those industries and areas, you’ll be much more successful and offer a lot more value.

Determine if the Domain is Available

A key step in the process is to make sure that the domains you want aren’t already taken. Here at Name Experts, we can help you with this entire process. If the names are taken, which is common, you can check the marketplaces to either buy from people who own them, or rebuy domain names that are expired.

Consider the Price

You’ve found the name you want. It’s available. But how do you know if you’re getting a fair price? You can use sites like namebio.com to compare the name you want with similar ones. It has interesting features like entering keywords and finding a list of names that are close to yours that includes what they sold for and when.

At Name Experts, we can also help you make sure you are getting the most bang for your buck. We have experts who can appraise the domain to find out what it is actually worth, so you know if you’re getting a good deal, and what it might be worth to potential buyers.

Buying Your Domain Name

You have successfully evaluated your domain name and determined a fair price. Now, it’s time to buy it. Your preferred domain can be purchased through a registrar, a marketplace, or a domain broker

When buying through a registrar the key is to choose one accredited by the Internet Corporation for Assigned Names and Numbers (ICANN), the nonprofit overseeing domain names. Follow this link for the full list of ICANN-accredited registrars.

If you want to buy from a marketplace there are many to choose from. These are our top 5 marketplaces and a quick Google search will yield many other options.

Finally, if you want to have someone else handle most of the effort in the buying process for you, hiring a domain broker will be your best option. Here’s what a domain broker does and how they can work for you.

Attract Attention To Your Domains

After buying a domain name, you need to attract attention to increase its value. A dormant domain doesn’t achieve much nor will it increase in value. Sure, you can find examples of dormant domains that made significant profits for their owners when sold, but that’s the exception and not the rule. Doing something with your domain increases your chances of selling it for significant gain.

What can you do with a domain? There are many answers. You can create a website with it to attract users. It doesn’t have to be a website you actively manage every day. You can fill it with content you only need to edit occasionally. For example, if you acquire “SchoolsInTexas.com,” you can write a detailed list of the best schools in Texas and add it as the homepage. Anyone who opens the domain might like the content and share it with others. As more people flock to the domain, its monetary value increases.

In the above example, you could even place advertisements on the content and make money from your domain. The ideal advertisements would be for the schools listed on the page. This example applies to many scenarios.

You can advertise your domain on search engines like Google and Bing or social media platforms like Facebook and X (Twitter) to draw attention. The good thing about online advertising is that you can do it even with a low budget. The idea is to gather eyeballs to your site to increase its value.

If you place content on your domain, ensure it’s optimized to rank high on search engines with search engine optimization (SEO). This optimization involves including relevant keywords, formatting the article neatly for humans and search engine crawlers, and writing helpful content for your audience. It also helps to get inbound links to your site from other similar, authoritative websites, i.e., backlinks.

With enough attention and audience, you can proceed to sell the domain.

Determine Your Domain’s Value

You have successfully attracted attention to your domain and are ready to sell. First, you must determine a fair value for the domain. You don’t want to underprice the domain and leave much money on the table or, inversely, overprice the domain and not find a willing buyer.

Here are critical questions to help you determine your domain’s value:

  • Does the domain receive any traffic? The higher the traffic to a domain name, the more valuable it is. Showing proof of high traffic can fetch your domain a substantial price.
  • Does it generate any income? If your domain name already generates income from advertising or any other method, it becomes easy for an intending buyer to value it. You can sell the domain for many multiples of its revenue.
  • Does it have any search engine authority? Your domain’s search engine visibility largely contributes to its value. Domains with quality backlinks have more value than those without. Check your backlink profile to evaluate how much your domain name can fetch. If you feel they aren’t enough, you can build more backlinks before listing the domain for sale.
  • Is the domain name brandable? You’re more likely to fetch a higher price for a domain that’s easily brandable. Such domain names tend to be short and easy to recall. Businesses pay top dollar for brandable domains because they draw more online traffic.
  • Does it have a popular TLD? Domain names with popular TLDs like “.COM,” “.NET,” and “.ORG” are more valuable than those with less popular TLDs.

Pro-tip: If the answer to all the above questions is yes, you’re on the right path of flipping domain names for profit.

Selling Your Domain Name

You’ve determined a fair price. Now it’s time to sell it. Consider how you want to sell the domain and evaluate which will give you the optimal price. Your best options for domain name flipping include:

  • Private Sale: Sellers can negotiate one-to-one deals with intending buyers. You’re free to approach an individual or business you think might be interested in your domain name and negotiate a price.
  • Marketplace: You can list your domain name on a dedicated domain name marketplace. It’s easier to find buyers this way because the marketplace already has domain name investors looking for good deals. The marketplace will take a cut of your sales for their service.
  • With a Broker: Another effective way is to hire a domain name broker like Name Experts to negotiate a deal for you. Domain brokers are experienced in evaluating the value of domain names and can fetch you the best possible price. The broker handles the negotiations, and you only need to authorize the domain transfer.
  • Auction: Auctioning your domain name is another way to sell it. You’ll place the domain up for auction on a marketplace, and the intending buyer with the highest bid will get it. Domain auctions usually last several days, so there’s ample time to find a willing buyer and profit from domain name flipping.

After deciding how to sell your domain name, the next steps include:

Use An Escrow Service

It’s advisable to use a third-party escrow service when selling your domain name. The escrow service holds the money paid by the seller and releases it after confirming that you’ve transferred the domain. It prevents you from falling victim to fraud, e.g., a buyer refusing to pay after you’ve transferred your domain.

Transfer the Domain

Transfer the domain as agreed to the intending buyer. You’ll request an authorization code from your registrar and transfer the domain to the buyer’s registrar account. Note that most registrars require a domain to be at least 60 days old to be eligible for a transfer.

Building Your Domain Portfolio

You can become an expert investor specializing in domain names if you’re willing to learn about it and create long-term value. Domain names are like any other asset to invest in, but you must do it carefully. Follow these tips to build a good portfolio and make money flipping domains:

  1. Understand your strategy: Domain name investors either follow the “quick flip” or “buy and hold” strategy, and these phrases are pretty explanatory. Choose which strategy you want to follow, or use a mix of both.
  2. Diversify your portfolio: The portfolio’s value should not be tied up in a single or few domain names because of concentrated risk. Feel free to acquire more domain names to balance your risks.
  3. Never overpay for an asset: Don’t be the inexperienced investor who overvalues and pays excessively for an asset. Ensure you get third-party evaluations before paying for a domain. This will help you to maximize your profit when you sell the domain.
  4. Study and gain knowledge: The domain name investment scene is flexible and dynamic. New events occur every day that affect the value of domain names, so ensure you stay up to date with industry news to avoid getting left behind.

Risks of Flipping Domains

Domain name flipping doesn’t guarantee profits. It carries risks just like any other type of investment. The main risks include:

  • Low Liquidity: Domain names don’t have as much demand as other assets like stocks, bonds, and commodities. You’ll likely need to wait a while after listing a domain before you find a willing buyer. It’s not something to invest in if you want short-term liquidity.
  • Unexpected Valuations: Domain name valuations can swing high or low on a whim. You might buy a domain, wait a while, and list it for sale, and the offers will be significantly less than you paid for it. Domain name valuation is not as technically grounded as in other assets like stocks and bonds; the value depends significantly on a buyer’s intuition, so be aware of the risks.

Other Ways to Make Money with Domains

Buying domain names to resell isn’t the only way to profit from them. You can make money in other ways, such as:

  • Domain LeasingRenting your domain name to another party for an extended period. You’ll be paid at specific intervals, e.g., monthly, quarterly, or yearly, giving you steady income for as long as the lease lasts.
  • Parked domains: You can keep a domain and make money by placing ads on the homepage with a strategy called “domain parking.” You might also redirect the parked domain to an existing website you operate that generates revenue.
Subscribe for More Domain Buying & Selling Advice

Related posts

Default alt text
The 3 Types of Domain Names and Common Domain Extensions

A domain name is an address you type into your web browser whenever you want to visit a website and is the most important property for every online business. While ‘domain name’ is an all encompassing term, a domain is actually made up of multiple parts. What are Domains? A domain name is a human-readable address that directs you to a particular website available on the internet. It’s akin to the address for your official residence or workplace. When someone wants to visit you, they come to your address. Similarly, when someone wants to visit a website, they type in the domain address in their web browser. Any domain name has four main components; Domain name: The name of the domain itself. Top-Level domain (TLD): The suffix that appears after the domain name, e.g., .COM and .NET. Subdomain: A domain that is part of another primary domain. It is also known as a third-level domain. Protocol: The system that specifies how information from the domain is transferred to your web browser. It is either HTTP (insecure) or HTTPS (secure). Take https://www.nameexperts.com/, for example. NameExperts is the domain name .COM is the top-level domain WWW is the subdomain HTTPS is the protocol The 3 Types of Domain Names There are three main types of domains, including: 1. Top-Level Domains A top-level domain (TLD) is the final section of a domain name. It is the last segment of text appearing after the dot symbol. For example, in Google.com, .COM is the top-level domain. Ever since the world wide web’s inception, .COM has been the most common top-level domain. It was originally used to designate commercial businesses but has become the de-facto TLD for most websites. Another popular TLD is .NET. It was initially meant for internet service providers and networks but is now available to anyone who wants it. Because NET signifies network and technology, this is an ideal option for technology companies. Yet another well-known TLD is .ORG, which was originally used to designate not-for-profit organizations. Till today, most people associate this TLD with non-profit organizations and social causes rather than commercial businesses. There are two main types of top level domains; Generic TLD A generic top-level domain refers to domain name endings with three or more characters, the type that you’d most likely recognize. .COM, .NET, .ORG, .INFO, and other common domain endings fall under this category. Before 2011, there were barely two-dozen domain extensions classified as generic. That year, the Internet Corporation for Assigned Names and Numbers (ICANN) expanded the number of generic domain extensions from 22 to over 1,200, opening up more opportunities for individuals and businesses to acquire domain names. Country-Code TLD As the name implies, these are domain extensions associated with specific countries. ICANN assigns country domain endings to each formally recognized nation and sovereign state, and these nations collect a royalty on every sale of their assigned TLD. For example, Tuvalu, a small island nation, earns 1/12th of its annual income from its .TV domain extension. Other popular examples of country domain endings include .US for the United States of America .AU for Australia .DE for Germany .CA for Canada .CC for Cocos Islands .AE for the United Arab Emirates (UAE), etc. 2. Second-Level Domains A second-level domain is directly below a top-level domain in the domain hierarchy. It is the part of the domain name that comes right before the top-level domain. For example, in NameExperts.com, NameExperts is the second-level domain. The second-level domain is usually a combination of words describing the business or service of the domain name owner. In the above example, NameExperts describes the business of a professional domain name broker that helps customers to acquire valuable domains. A second-level domain can include letters, numbers, and hyphens. Symbols are not allowed. 3. Third-Level Domains The third-level domain, or subdomain, is the part of the URL that comes before the second-level domain. The most common subdomain is www., which refers to the world wide web. Third-level domains are not mandatory, so you can have a fully functional domain name without the www part. Some website owners create third-level domains to represent a different section of their website. Examples include: Shop.mywebsite.com refers to the e-commerce section of a website. Blog.mywebsite.com referring to a blog attached to the website. Support.mywebsite.com leading to the customer support section of a website. Understanding Domain TLDs A domain name is the most important property for anyone who conducts business online. Hence, it’s crucial to understand what they are and the different types of domain name extensions to use for a website. The information above should help you figure out how to structure your domain, but if you need help, we’re experts at domain selection and helping you buy the perfect domain.

Default alt text
Make Money on Your Domain With Domain Leasing

What Is Domain Leasing? Domain name leasing refers to renting a domain name for an extended period, usually a year or more. An individual or business pays to rent a domain name owned by another individual or corporation. This arrangement allows the lessee to use a domain name for a long time without paying a substantial sum outright. Domain leasing is usually done for valuable domain names that are too expensive for the lessee to acquire completely. How Does This Compare To Renting? Renting and leasing are the same thing, except for the latter being for longer periods. Domain leasing agreements usually cover at least one year compared to typical renting, which covers a few months. What Are the Ways You Can Lease Your Domain? You can lease your domain through the following ways: Periodic payments: The lessee can pay for their lease at specific intervals. For example, they could pay monthly or quarterly for the period the lease lasts. This method gives the domain owner stable income they can count on during the leasing period. Percentage of profit: You can agree to take a percentage of profits the lessee makes from the website using your domain name. This method is riskier, as there’s no guarantee the website will be profitable. However, there’s a higher upside if the website becomes a profit-making enterprise. Royalties: You can collect a fixed percentage of the lessee’s net revenue for as long as the lease runs. Ownership percentage: You can request a percentage of shares in the domain lessee’s company. This method is risky but can earn you significant income if the website becomes a viable business that another corporation eventually acquires. Benefits Of Leasing For Domain Owners Provides Another Way To Monetize A Domain Monetizing a domain is better than having it sit idle. If you have a valuable premium domain you’re not using, leasing it out can earn you passive income. You can always reclaim your domain once the lease expires. Opportunity For Investors With Domains In Their Portfolio Many investors specialize in acquiring domain names for profit. Investors with a portfolio of valuable domain names can lease them for a long time and get stable income. Consistent Revenue Stream Renting out a domain for periodical payments generates consistent income for the owner. The owner is sure of getting a specific return on the capital they spent acquiring the domain as long as the lease lasts. The Domain Value Increases Due To Usage Active domains are more valuable than inactive ones because of online traffic. The higher the traffic to a domain, the more valuable it is. Leasing out a domain increases its value in the long term, which the owner can realize by selling it later. Long Term Financial Advantage Receiving periodic lease payments can generate more revenue in the long term compared to selling your domain for a lump sum. It’s why many owners lease domain names out despite getting lucrative purchase offers. Benefits Of Domain Leasing For End Users Spend Less Money Upfront Valuable domain names can run into tens or hundreds of thousands of dollars, which is risky to spend upfront. Leasing allows you to build a business with the domain and make periodic payments from the revenue you generate, which is cost-effective. Lesser Burden If the website you use the leased domain for fails, you can terminate the lease and return the domain to the owner. If you owned the domain outright, that means having another asset you must keep renewing or find a potential buyer for. Opportunity To Buy the Domain In the Future Some lease terms include an option to acquire the domain outright later. This way, you can start the website to see if it succeeds. If it does, you can acquire full domain ownership and gain more control over your website’s fate. Access To Premium Domain Names At A Lower Cost Domain leasing lets you use very valuable domain names for lower costs. These valuable domain names can draw more organic traffic to your website. Avoid Legal Liability Issues Leasing a domain name means avoiding any legal liabilities concerning the domain’s ownership. Any legal dispute is the concern of the owner and not the lessee. Downsides Of Leasing A Domain No ownership Not having full ownership of your domain is a risk. The owner can terminate the lease anytime and pay any agreed monetary penalties for early termination. It could be at a crucial time when your website is booming, and losing the domain would affect it negatively. Less Control You have less control over your website than the domain owner. Let’s say your website grows big and becomes valuable, its fate lies more in the hands of the domain owner than yours. They could use that leverage to extract concessions from you. The Domain Value You Build Is Never Yours Drawing traffic to your website increases the value of its domain name. Yet, the owner will capture that value instead of you working hard to maintain the website. Where Can You Lease A Domain Domain Marketplaces Many domain name marketplaces allow owners to list and lease their domain names. This method is beneficial because owners can easily find customers to lease domain names to. The domain leasing services generate a lot of traffic, giving you higher chances of finding an interested lessee. Domain Brokers You can approach a domain broker to lease your domain for you. Domain brokers are experts in negotiating domain deals and can fetch you the best possible price. They’ll collect a fee for their service, either a flat rate or a percentage of the lease value. Word Of Mouth You can spread the word to your social and business circles about a domain name you want to lease out. You may find a trusted lessee this way and negotiate a good deal to earn a stable income. Forums You can join webmaster forums and post about the domain name you want to lease. You may find a buyer this way, but ensure you use a transaction escrow service because you’re dealing with a stranger. Leasing versus Buying a Domain While leasing a domain might be a good option for some businesses, buying your domain outright continues to be the safest and most secure option for guaranteed success. If you’re interested in acquiring your perfect domain, we make the entire domain buying process easy. Contact us for more information about our domain buying service.

Default alt text
Most Expensive Domains Ever Sold

If you’d had the foresight to register a domain name like golf.com or hotels.com when the internet first started, you’d have been sitting on a goldmine. Domain name valuation expert and broker Joe Uddeme investigates.   What Are The Most Expensive Domains Ever Sold – An Expert Analysis In the vast landscape of the internet, domain names serve as the digital addresses that guide users to websites. Think of a domain name as the online equivalent of a physical address; it’s how people find you in the vast expanse of the web. Whether you’re a business, a blogger, or an individual, having a memorable and relevant domain name is crucial for establishing your online presence. Domain names are not just about being found; they are about being remembered and trusted by your audience. Domain names sell for a wide range of prices, from just a few dollars to millions, reflecting their value and market demand. A relevant domain name can improve a site’s visibility and attract organic traffic by aligning with users’ search behaviors and preferences in different search engines. In this guide, we’ll look at some of the many factors behind domain name values and explore those that sold for the highest prices. Key takeaways: Serious bidders always assess the potential return on their investment before bidding. The most expensive domain name ever sold for just under $1 billion. Short, memorable names command a higher premium than ever. Domain names can be traded like shares – with fortunes being made (and lost)! What Makes Valuable Domain Names? A domain name’s value is influenced by several key factors. First and foremost, rarity plays a significant role. Just like rare collectibles, domain names that are unique and scarce tend to be more valuable. Demand is another critical factor; a domain name that is highly sought after by businesses or individuals will naturally command a higher price. Revenue potential is also a major consideration. A domain name that is easy to remember and directly relevant to a business or brand can drive significant traffic and, consequently, revenue. Brand recognition and online presence further enhance a domain name’s value, as a well-known name can attract more visitors and establish trust. The concept of an ’empty domain’ highlights that true value lies in memorable and brandable domains rather than random letter combinations. The length and structure of a domain name are also important. Shorter domain names, especially those consisting of a single word or a combination of two words, are generally more valuable. Avoiding hyphens, underscores, and other punctuation can also help maintain a domain name’s value. Market conditions, however, can make seemingly meaningless combinations valuable, as seen with some of the most expensive domain names sold in 2023. Lastly, the domain extension, or top-level domain (TLD), can impact value. The most valuable TLDs are .com, .net, and .org, as they are widely recognized and trusted by users.

Why Work with Name Experts

Name Experts offers personalized domain brokerage services, assisting clients in buying or selling premium domain names with expert appraisal, negotiation, and complete transaction management while ensuring confidentiality.

Some of our most
successful stealth acquisition and sales

Aid.com

Fit.com

Mine.com

GLD.com

Jeff.com

Fora.com

Nori.com

Secure.com

Guitar.com

F*ck.com

Radian.com

MetaData.com

Prize.com

Link.com

Loop.com

Programs.com

Claim.com

Quince.com

Hook.com

QXO.com

NQ.com

Rest.com

Humani.com

Max.com

Need help buying or selling your premium domain?