Domain Flipping 101
Updated: November 19, 2023 – Bill Burniece
Domain flipping is a really interesting way to make money online.
Personally, it represents one of my favorite income streams online.
It’s arguably the easiest money you’ll ever make as long as you use a little creativity, do solid research, and have a knack for predicting future products and markets.
What Is Domain Flipping?
Domain flipping is the practice of buying domain names at a low price and then selling them at a profit.
It’s kind of like real estate flipping, but without all of the heavy lifting involved.
How Does Domain Flipping Work?
Flipping Domain Names: 6-Step Guide
- Domain Name Research: This is the critical first step to flipping domains for profit. If your research is poor, you will likely fail to make either a a profit or a sale. The most valuable domain names are short, catchy, and easy to spell. They can also be timely due to trending current events or news.
- Set Your Budget: Don’t just go shopping for domains without knowing what you are comfortable with spending. Like gambling, never bet more than you can afford to lose. If you are new to domain flipping, start small to limit your losses as you learn.
- Domain Name Acquisition: Once you find a domain name you’re interested in, make your purchase. This can be done through a domain registrar (such as GoDaddy) if the domain is new or unregistered, or in the secondary market if the domain is already owned by somebody else.
- The Value Addition Option: You can now simply ‘park’ the domain and start the process of selling it. Or if you would like to add value to the domain, and make it worth more, you can develop a website for the domain. You can also build a social media presence to make the domain more attractive to potential buyers.
- Domain Marketing: The next step is the start marketing your domain to potential buyers. You have many sales channels to choose from including selling the domain yourself (direct sales), domain auction sites, or domain brokers who specialize in domain sales.
- Negotiate The Price: The value of your domain is ultimately determined by what someone is willing to pay for it. Negotiation skills go a long ways during this process.
- Selling Your Domain: When a buyer is found. blah blah blah.
- Transfering The Domain: After the sale, the domain needs to be transferred to the new owner. This process is governed by the Internet Corporation for Assigned Names and Numbers (ICANN) and involves updating the domain’s registration to reflect the new owner’s information.
Domain flipping can be a lucrative business, but it also carries risks.
The value of domain names can be highly speculative, and there’s no guarantee that a purchased domain will be sold for a profit.
It requires a good understanding of current market trends, SEO, and sometimes a bit of luck.
Additionally, there are ethical considerations, as some practices in domain flipping, such as cybersquatting (registering domains to profit from trademarks or names of existing businesses), are illegal or frowned upon.
Most Expensive Domains Ever Sold
- Insurance.com – $35.6 million in 2010
- VacationRentals.com – $35 million in 2007
- PrivateJet.com – $30.18 million in 2012
- Voice.com – $30 million in 2019
- Sex.com – for $14 million in 2014
- Internet.com – $18 million in 2009
- 360.com – $17 million in 2015
- Insure.com – $16 million in 2009
- NFTs.com – $15 million in 2022
- Fund.com – $12 million in 2008
- Tesla.com – $11 million in 2014
- Hotels.com – $11 million in 2001
- AI.com – $11 million in 2023
- Connect.com – $10 million in 2022
- Fund.com – $9.99 million in 2008
- Porn.com – $9.5 million in 2007
- Porno.com – $8.8 million in 2015
- Fb.com – $8.5 million in 2010
- HealthInsurance.com – $8.13 million in 2019
- We.com – $8 million in 2015
- Diamond.com – $7.5 million in 2006
- Beer.com – $7 million in 2004
- Z.com – $6.8 million in 2014
- Casino.com – $5.5 million in 2003
- Slots.com – $5.5 million in 2010
- AsSeenOnTv.com – $5.1 million in 2000
- Toys.com – $5.1 million in 2009
- Korea.com – $5 million in 2000
Now I know what you are probably thinking…
“that’s cool, but all those premium one & two word domain names have been gone for decades now and I have no chance to get one myself”.
That’s true. But that doesn’t mean there aren’t other domain names that can fetch you a hefty price.
Consider these domain names that have sold more recently:
- Goliath.com $60,000
- Consules.com $50,000
- Suvs.com $30,000
- BuyShares.com $15,900
- BlowDryer.com $8,400
- TopTenVideos.com $7,888
- Refer.ly $4,900
- UsedGadgets.com $2,600
- MMAEvents.com $1,751
- ArtWork.info $1,600
Domain names similar to the set above are completely findable today if you put some good research into locating them.
Imagine selling just one or two of these each month on top of your existing affiliate income and other revenue streams you may have.
Where To Flip Domains
Flippa is the entrepreneur’s marketplace.
Flippa is the world’s number one marketplace for buying and selling websites, domains and apps.
Buyers love Flippa due to the extensive inventory to suit a range of investors.
In fact more than 1,000 new businesses are listed for sale on Flippa every single day.
As the first and leading marketplace for entrepreneurs, they’ve built a buying experience that is second to none, it’s simple and secure.
Sellers use Flippa due to it having the highest sales rate in the industry—primarily due to the massive size and quality of the Flippa buyer audience.
Every month on Flippa over $2m of businesses are sold.
How about some statistics?
- Over 600,000 users have registered to buy or sell on Flippa
- A bid is placed on a Flippa auction every minute
- More than 2,500 buyers and sellers are online every minute of the day
- In the last 12 months 300,000 bids were placed and nearly 23,000 business were sold on Flippa
- Alexa puts Flippa in the top 1,000 sites worldwide
Go check out Flippa.com right now and get in the game.
A Dose Of Domain Flipping Reality
Not to be a buzzkill but there are some truths you need to know about selling domains before you learn the hard way.
- Most of your domain names are probably unsellable
- Despite what you think your domain names are worth they’re only worth what a buyer is willing to pay you for them. You don’t set the end-price; the buyer does
- Finding lucrative domain names is much harder now than it use to be
- There is a lot of competition in the domain flipping arena and most marketers fail
So now that I’ve kicked you in the gut I want to point out that if you’re a bright, creative, and forward-thinking person and can develop a knack for selling domains you can make very good money doing it.
I know because I learned domain flipping myself and make a solid profit every month buying and selling domains.
Now lets get down to brass tacks…
How To Find Domain Names That Attract Buyers
Marketers frequently mention that aged domains are easier to rank than new ones, which is true, but it’s not so much the age of the domain as it is the authority (backlinks and PageRank) an aged domain may bring you.
I have a full page showing you how to find expired domains here: How to find expired domains.
2. Shorter is better but also harder to find.
One word domain names are long gone but good two-word and three-word domain names are still prevalent.
3. Careful with hyphenated names. I don’t believe the search engines penalize you for hyphenated domain names but many buyers will avoid them anyways because they can be a pain for internet searchers.
4. Be patient. Domaining is like gold mining.
You’re not going to pull endless gold nuggets out of the ground from day one.
But if you’re patient and put in the time to learn how to find good domains you’ll eventually find a winner.
On the other end of things, be a patient seller too.
Many people get impatient when selling domain names and end up leaving a lot of money on the table instead of waiting for the right buyer to show up.
5. Stay the hell away from trademarked names. This is the fastest way to get yourself in trouble.
The fines can be upwards of $100,000.00. Avoid something too similar to competing domain names and make sure not to violate others.
You can check for free on this website: trademarkia.com.
6. Stick with .com’s for the most part. It will always be the gold standard and thus the most valuable top level domain.
Unfortunately they’re also the hardest to find.
7. Predict future markets.
In my opinion this is where the real opportunity lies. Sure all of the good industry domain terms are taken but what about markets that don’t exist yet?
Since you can pick up a new domain name for about seven bucks its a low risk investment to try your hand at some of these.
If you get good at forecasting future markets you have the potential to make big bucks down the road.
Think about where technology is leading us and look at the evolution of markets to get ideas.
I think we all know where we’re going in the near future: everything AI, self-driving cars, robots, drones, 3-D printing applications, interplanetary travel, organ harvesting, advanced wearable technology.
Use your imagination.
8. Never pay for a domain appraisal. Period.
A domain appraisal has no value whatsoever. Remember that the price is ultimately set by the market.
Save your money and skip the paid appraisal. And if a buyer asks you to get an appraisal before they buy it – don’t walk but RUN the other way.
Some of these are schemes and scams perpetrated by scumbags only interested in separating you from your money and have no intention of buying your domain.
9. It’s OK to buy domains from domainers but never sell to domainers.
Focus on selling only to end users to ensure you get the best price for your domain.
Your best buyers will be people who not only know how to use your domain but will actually put it to use for their business and not just resell it.
You don’t even have to sell a domain name to make money on one.
There is another model called domain name leasing.
Domain leasing allows you to rent out a domain name for an extended period of time – typically a year or more.
In a domain leasing arrangement, a company or person will pay you to use one of your domains temporarily.
Now, you’re probably asking “Why would anyone want to lease a domain name instead of buy it?”
There are actually several benefits for the domain lessee:
- Access to premium domain name without a large upfront cost
- Being able to test the domain name using their model without the long-term risk of losing their sizeable investment in the domain. If the website doesn’t succeed they can simply terminate the lease
- You can offer them the opportunity to buy the domain in the future if their business is successful
As the owner of the domain, you will negotiate the terms of leasing including the payment amount and period (monthly or quarterly), a percentage of profits made from the website using the domain, royalties, or even an ownership percentage in the lessee’s company.
Domain leasing is a highly-sought-after arrangement that can pay you ongoing commissions for really doing nothing but loaning your domains out for a while.