When I first wrote this article, I was reading it back to myself and realized it was very generic, it did provide some great insight, but really didn’t explain how, so I decided to rewrite and give as much of a detail to buying and selling domain names for profit as possible, so for some this might seem a little tedious, but I remember when I stated and had no idea what I was doing, and I searched for hours trying to find something, where to buy, how to sell, how do you value the domain, so hopefully we can answer those questions for anyone trying to break into the business.

The art of flipping domain names for profit can be a great way to get into the virtual world of real estate, just like with real estate, the idea is to buy low and sell high, as the old saying goes, location, location, location, which is the case of virtual real estate, that would be .com, .net, .biz, lets not forget about buying a fixer upper and adding value to it before selling it, there are many ways to do that as well, so lets get into the details.

Getting Started:

We must first start purchasing and or creating domain names, there are many places to do this, Godaddy.com, NameSilo.com Dynadot.com just to name a few. Now for me when I try to create a new domain name, it’s tough because most of the good simple names are already taken, it doesn’t mean they are being used, just that someone has purchased them, waiting for their values to increase. To create we must get creative and brainstorm, think about a niche that you are familiar with, like clothing, well we all  know clothing.com is taken, but that gives us a starting point, you can narrow it down from there, until you create the perfect name. Now to purchase domain names there are many choices here too, you can buy from private parties selling their domains like Smart Choice Domains, or there is ebay auctions, flippa auctions, and one of my favorite places is godaddy auctions, using these methods I have purchased domains for as little as a penny, but on average about $5.00, still a good price if you can sell that domain name for $25.00 or more. Just to give you an idea, right now at GoDaddy auctions I can buy xpresscreditrepair.com for $5.00 plus one-year renewal and it has a current value of $1,002.00.

Adding Value:

Now we need to add value or create value for the new domain name we just created or purchased, there are several ways to do this but I am just going to go over a couple of them, it’s a little like putting new flooring and paint on a house before you sell it. So, in the same sense creating a logo and ideas of what the domain name could be, might be all that is needed to add the extra value or extra incentives to sell at the higher price. The other which takes a little more work and time, is to complete a full rehab on the virtual property, what I mean is to build a website or pay to have one built, you can find great simple websites builders on fivver or Upwork if you need. Please understand this is not a get rich quick internet business, there is a lot of work that goes into being successful at flipping domain names, and can take years before you see a profit, the days of buying candy.com for $10.00 and selling it for $1,000,000.00 have past us up, not saying the one couldn’t get lucky, but the odds have dropped. There is a little more work than putting up a "for sale" sign and waiting for the money to roll in.

Pricing Domains:

Now the most important part of the business, pricing the domain name for sale, how do you figure out what to price the domain? Its not like real estate where you have thousands of homes in the area that have previously sold, every domain name is unique. There are several factors that go into valuing a domain name, age, traffic, length, and popularity. There are several sites that help with the value now, like Godaddy Appraisal, FreeValuator.com, and Estibot.com just to name a few. In the end though it’s only worth what someone is willing to pay for it, the more attractive it is, the better the chances are for a higher price.

Where to Sell:

Where do you sell those domain names? There are many choices on the market today, if you have just a couple at a time, you could use ebay or flippa or a site like SmartChoiceDomains, pretty inexpensive options, as your business grows though you might want to consider your own platform like efty.com or dan.com. I tend to always forget to mention social media, as I just expect everyone to know this already, but social media can really help sell your domain names quickly.

Bonus Tips:

Don’t sell yourself or your product short, just because there is only a low offer on the table, does not mean that you have to accept it, unlike Real Estate the holding costs are relatively low.

Low hanging fruit, I said I would bring it back around to that, I call it that in all businesses, because you always have that quick and easy sale, might not be the most profit, but its like one of those guarantees, I call that the low hanging fruit, quick and easy everyone wants the quick and easy, so it creates more competition and typically increases the prices. My point is just because it may seem quick and easy doesn’t always mean that it will be, sometimes the more work you put into it, the greater the returns.

If you still have questions please do not hesitate to leave a comment below or contact us if you would prefer, info@smartchoicedomains.com

1. Avoid These Domains at All Costs!

While good domain names can be hard to come by, do not make the mistake of buying a domain name that contains a lot of dashes. For example, [www.dog-training-tips.com]. While this might be a reasonable site you use if you are developing it yourself, the resale value of the domain itself is going to be minimal. However, with this particular domain name, it is currently for sale for $1,095.00, I would not consider that minimal, but it has not sold either. Google recognizes domains with lots of dashes as lacking the authority of domains without dashes. This greatly effects the search engine optimization capabilities of this domain. It is best to avoid domain names with even one dash, as it is likely to drastically cut into resale value.

2. Find Domain Names with Less Than 20 Characters

I use 20 characters as a rule of thumb, though this number is not set in stone. Generally speaking, domain names that have high value are going to be short and sweet. A few examples: loans.com recently sold for $3 million, cinemas.com sold for $700,000, and asseenontv.com sold for $5 million. These domains are simple and to the point. Granted, there are not a lot of domain names like these left, but you can imagine the resale value of cinemas.com as compared to thebestamericancinemas.com. The longer and more convoluted the domain name, the lower the resale value. AutoSurvivalKits.com is under 20 characters, but is very close to the max, but considering what it says, it is very descriptive and can serve several uses depending on your product, could be a auto repair kit, auto safety kit, or a survival kit for being stranded on the side of the road or in snow.

3. Misspelled Domain Names

Buying domain names that are common typos is a dangerous path to take. This is often called "cyber squatting" or "typo squatting." There is now legislation to protect trademark and service mark owners from this practice. In order for a domain name to fall under this category, it must be "identical or confusingly similar" to some other trademark or copyrighted service.

A recent court case found a man guilty of "typo squatting" on over 5500 domain names that were variations of copyrighted terms. To make matters worse, when unsuspecting surfers arrived at his web pages, they were re-directed to pornographic web sites. This gentleman was sentenced to two and a half years in prison and forced to pay huge fines. The moral of the story: Do not be a "typo squatter!"

These are three of the most common mistakes people make when buying and selling domain names. Fortunately, there is an exact formula for domain flipping that has made a lot of people rich. The best part is, you do not need to be an internet professional or have any experience in running a business to make money from buying and selling domain names. Follow the blueprint and you will be well on your way to becoming a "domain profiteer."