Domain Flipping: All You Need To Know About It In 2024

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domain flipping

Are you considering getting into the domain-flipping business to make extra income? Learn all there is to know about this lucrative business.

Domain flipping can be a very profitable means to make money online. It can be done as a full-time business or as a side hustle. Its process is relatively easy.

If you know about flipping an asset, like buying an old house, restoring it, and selling it at a profit. Flipping domains work in a similar fashion. You buy domains at cheaper rates and sell them high for probably thousands or millions of dollars.

This direct and productive business model is an excellent approach for individuals and small business owners. So, if you want to provide extra services to your clients while avoiding huge startup costs, you can go this route.

A lot of entrepreneurs are taking advantage of the high demand for domains by starting this lucrative business. But, domain flipping needs a strategic approach.

So, developing an understanding of domain valuation and domain investing is vital to becoming successful in the domain flipping industry.

As a beginner, you possibly have no knowledge of this. So that is why this article will provide a detailed guide on how to flip domains effectively. Most importantly, all you need to know about flipping domains. Now, let’s dive in.

What is a Domain Name?

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A domain name is referred to as the name of the website with extensions like .com, .org, .net, or others. For example, Grammarly.com, the domain name is Grammarly, while the extension is .com.

So, when you hear about a top-level domain, it means that the domain name has one of the best popular extensions, like .com, .org, .net, and so on.

What is Domain Flipping?

domain flipping business

Domain flipping simply is the means of buying and selling domain names for profit. A lot of research goes into this practice of buying domain names at low cost and reselling them at higher prices.

The major aim is to discover high-potential value domains and sell them directly to buyers who need them or sell them on a domain-flipping website.

Domain flipping is a naturally risky practice. This is because there are no guarantees that a domain will go up in value. So, doing your research is important to help you find likely profitable domains.

Some people hold on to domain names for longer periods to increase their return on investment. But, some people quickly convert them into profits in a short period, like within weeks or months.

Not all domains are good for flipping. If you want to maximize profit with a domain name, it is necessary to know which will be worth your time. So, in the next section, we will examine the kind of domains that are worth flipping.

Which Domain Names are Best for Flipping?

domain name

Regarding domain flipping, you can decide to buy a new domain or an expired domain. Although, it is not exactly clear which particular domain will generate higher profit.

However, knowing the benefits and shortcomings of each domain will help you make informed decisions.

When it comes to new domains, you can easily find and register them. Additionally, they offer more versatility when it comes to branding.

New domains do not have much history linked to them. This makes it look more genuine to potential buyers.

But to sell a new domain demands a lot because it does not have an authority connected to it yet. So, you will need a massive effort to apply marketing and search engine optimization(SEO) strategies.

For expired domains, buying them has its own perks. Most domain investors prefer to go for expired domains because of their good domain authority. Not only that, they also have a recognized link equity and traffic volume.

But the downside of expired domains is their limited availability. So, this makes them more expensive compared to the new domains.

When buying expired domains from a domain marketplace, consider making use of SEO tools like Moz or Ahrefs.

These tools will help you track the backlink and page authority quality. Also, carry out a check on the domain history to be sure it is free from illegal activities by the previous owner.

In the next section, we will explore profitable ways to flip domain names. Let’s dive in.

How to Flip a Domain Name?

flipping domains

Here, we will be exploring the ways you can start flipping a domain name. This will help you to know how to begin. Below are listed the steps to follow to begin flipping domains. Let us explore them in detail, one after the other.

1. Explore domain name ideas.

Coming up with ideas for a domain name can be overwhelming at the beginning. Several countless names and combinations are available for you to try. But the big question is, which one will become profitable in the end?

So, the best way to begin is to check how and what your competitors are doing. Simply searching online for domain flippers and examining their strategies can give you valuable insights.

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Going through the process can give added inspiration and knowledge as to the strategies your competitors are using to succeed. You also get an understanding of the strategies that aren’t working.

In addition, you can utilize SEO tools like Ahrefs to research keywords. Keywords with high search volumes mean a high interest level. So, any domain with such keywords can get buyers’ attention.

You can also monitor domain sales with websites like NameBio. They are also an ideal way to find ideas for domain names.

This site helps you to make informed purchases by letting you know which domain names are selling for higher prices.

2. Check trending domain extensions.

As you research for domain names, ensure to check trending and unique top-level domains (TLD). There are about 1500 TLDs available as of 2023 data, but only a few are used frequently.

Sources like InterNetX and Statista provide detailed statistics on the performance of domain extensions.

They allow you to check which top-level domains are presently giving potential for high profit. For instance, the findings on InterNetX emphasize on:

  • New trending general top-level domains (gTLDs). This includes .xyz and .online.

  • Potential popularity of GeoTLDs such as .asia and .africa, also city TLDs, like .berlin.

  • Country-code TLDs (ccTLDs), like .uk, .ga, or .ml, are also considered.

3. Look for domain names.

One of the trickiest parts of the domain-flipping process is searching for competitive domain names. You can get inspiration from a domain name generator. It helps you search for the best option.

In searching for domain names, look for high-quality domains with potential value. These kinds of domains are the kinds that yield higher profits.

The values of each domain differ significantly from each other. But the valuable ones usually come with the following:

  • High traffic rates: This already suggests that it has high demand. Some domains are very appealing to business owners because they are regularly visited. Business owners can take advantage of it to reach more customers, establish their brand, and build a high-traffic website.

  • One-word structure: Short and likable domain names are largely more profitable. They are appealing, improve recognition, aid brain credibility, and leave a minimal chance for user input errors.

  • Relevant keywords: Some domains incorporate keywords relevant to a kind of product, service, website, or location. These domains are referred to as descriptive domains. They offer businesses profit potential, which, in the end, pays you more.

  • Branding potential: Domains that can be branded are usually short URL pieces that are attractive, memorable, and created rather than descriptive. These kinds of domains don’t have keywords but use a distinct blend of letters. These letters could be branded later. Examples of these are bing.com, esty.com, and so on.

  • Backlinks: Domains that already have pre-established backlinks are usually more valuable compared to domains without any. One of the reasons this is so is because of the search engine optimization authority.

  • A good history: In reality, having a good history in previous jobs gives you a higher chance to land a new job during an interview compared to a fresh graduate without experience. So it is with domains. Existing or expired domains with good pasts are more valuable than new domains. Tools like WhoisRequest and URLTrends can be used to know a domain history.

Domain value depends on context. So, it is necessary to always go back to your findings from the research stage.

For instance, a domain name like ai.io may not have been of high value when artificial intelligence wasn’t in existence. But today, it is absolutely valuable today.

4. Evaluate domain names.

Once you have verified that a domain name is available, use an appraisal tool like EstiBot to examine its value.

Measure the authority of the domain using Ahref’s backlink checker and Moz’s domain authority tool. Then, use tools like URLTrends and WhoisRequesr to assess its history.

5. Purchase valuable domain names

Putting together all the results of your research, determine which domain names look like the most valuable. After you have decided, the next step is to buy them from high-quality domain registrars.

Ensure the use of a reliable, secure, and transparent platform. The platform should have an all-around-the-clock customer service. This way, you are able to cut down on delays when your domain registration encounters a problem.

With readily available customer support, someone on the other end can provide timely assistance. This will help you get back on track with your domain-flipping experience.

In addition, receiving prompt and attentive customer service from your domain registrar enables you to give your customers the best service possible.

6. Decide a pricing strategy

Several ways exist for selling domains you just bought. You can either sell through a domain auction, put out your offers, or list the domain at a flat price.

Auctions with flexible pricing have a high tendency to generate higher profits. Domains with flat prices can sell faster. The method of putting out an offer can generate unstable results.

As soon as you choose your pricing method, try using strategies that can boost your profit. Some of these strategies include:

  • Lure pricing: This pricing strategy is based on psychology. It entails going for prices that end in the number 9 instead of zeros. Based on reports from Konigle, this method has been proven to increase conversion and brand credibility.

  • Cost-based pricing: the prevalent approach entails calculating the cost of making a product and then adding a calm profit margin. Using cost-based pricing is an easy way to set an average markup for your domains.

  • Market-based pricing:  This method focuses on what competitors are charging for similar products. Consult the market prices for the same domains, then price yours in a similar range.

7. Choose how and where to sell the domains.

You can use domain marketplaces like Sedo and Flippa to sell domains. Consider key elements before choosing where to sell domains in marketplaces or auction sites.

The elements to consider are commission percentages, listing fees, user experience, traffic rates, and many other features they offer.

Examples of other features include notifications, domain transfer services, and user-friendly control panels.

On the other hand, you can work with a domain broker. This is an expert who helps you locate buyers and process sales. They charge a commission, but utilizing their expertise is worth it.

8. Create and post domain listings

Listing your domains on chosen selling platforms is the next step, especially if you are not using a domain broker. Apply the process below to create an improved domain listing.

  • Use banner ads: If you want your listing to draw attention, use banner ads. They redirect buyers to other domains in your collection. So, this boosts your authority as a domain seller.

  • Add related geographic keywords: Include the names of related locations in your listings if you are selling domains that will attract potential buyers and local business owners.

  • Create a brief description: Ensure that the descriptions of the domain remain straightforward and short. Add only the most relevant information. The details to add should resonate with your target audience and buyer’s personality.

  • Display your reliability: Add positive customer reviews, offer pricing transparency, put out clear and correct information, and display security specifications for your domains.

  • Make a parked domain: Build a beautiful and attractive landing page. The page should carry your link to the domain listing.

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Applying these methods, you are ready to post the listings. So, if you have chosen a high-quality platform to sell, the whole process should be easy.

Typically, all that will be required of you is to add your listing info, choose your pricing strategy, and name a time for each domain sale.

9. Update WHOIS for your domains

WHOIS is a public directory that saves information on who is responsible for which domains. You can report your contact information, identification, and domain name registrations.

It is vital to update WHOIS for your domains. Some domain flippers prefer to keep the information private. But, fulfilling this step makes it easier for buyers to reach out to you. This is a step closer to making a sale.

10 Aim and sell to top-quality buyers

Generate a buyer personality that represents your standard client. For instance, if your domain is attractive to IT agency owners and they operate near Austin, Texas, you can name it Techy Tom. This helps to easily remember it.

Properly creating this buyer persona will facilitate your search for businesses or individuals who may be interested in buying your domain. You can target potential customers by employing the following strategies:

  • Content marketing: Focusing on crafting content that is relevant to your audience is necessary for search engines like Google. This can be achieved by designing your content to fit a buyer’s personality and showcase your authority in the domain space.

  • Social media marketing: Prioritize making short-form video content. This type of content is basically created and shared across social media. As of now, this strategy is mostly preferred by marketers.

  • Email marketing: email marketing is another approach to gaining leads. Getting customers engaged via email is presently the second most common means for determining the success of content.

In essence, showcasing your domain strengths, especially as they relate to your buyer persona, can help attract prospective buyers.

For instance, specifically indicate the benefits of your domain to a particular business instead of randomly stating the benefits of domain names.

11. Sell and transfer domains safely.

Depending on your pricing strategy, you can negotiate to the highest price if you believe the buyer would pay.

Once they are ready to buy, end the deal with a domain sales agreement. The agreement should contain the terms and conditions.

The document should contain the following:

  • Relevant details of the domain, like registration date.

  • The buyer and seller contact information.

  • The sale price.

  • The transfer process of the domain.

This document is useful for a number of reasons. They are:

  • Avoiding fraudulent incidents.

  • Maintaining seller authority.

  • Avoiding legal problems.

  • Ensuring satisfaction on both sides.

So, as soon as a buyer buys your domain and the agreement is completely filled, give the buyer their own copy of the document.

You can use an escrow service during the domain transfer process. This helps to cut the risk of scammers and build trust in buyers.

The escrow service charges a tiny percentage of the sale. But, the peace of mind they offer surpasses the amount you pay.

Now that you know how to flip a domain, let us examine the advantages of flipping them.

Advantages of Domain Flipping

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Undoubtedly, domain flipping has a massive advantage that can’t be neglected. This is why it is a lucrative business to get into.

Here are some benefits it offers if you are considering it as an online hustle.

1. Make extra income

There is no doubt that many of us want to make extra income. Thankfully, domain flipping provides you the chance to achieve that extra income on a part-time basis. You can also run it as a full-time lucrative business.

So, the decision on which way to go is entirely up to you. What is important is that you make money flipping domain names from the comfort of your home.

2. Easy to begin

It doesn’t require much to start flipping domain names today. As long as you have a laptop, an Internet connection, and a credit card, you are ready to begin.

No prior experience is required. The most important thing is to understand how to value domains. Once you have that skill, you are unstoppable.

3. No skill is needed

For domain flipping success, a strong educational background or professional experience is not needed. It is easy, quick, and secure to buy domain names just as you do any other online purchase.

If you want to learn more about domain flipping, consider learning about domain research, domain valuation, negotiation, and networking.

So, begin by taking online courses on online educational platforms like Udemy or Skillshare. Several domain marketplaces also allow you to practice domain selling on their platform.

4. Involves low risk

This lucrative business is low risk. This is because of the little difficulty to begin. You don’t necessarily need to buy domains for thousands of dollars before you can make a profit.

So, you can begin by finding quality domains for $10-$15 and flip them. This process means that you begin with a low investment and you reduce any risk.

It also indicates that you can grow money for future investments and learn before you make huge investments.

With domain flipping, you can start small and grow while learning more. Until you are ready to climb high, there is no need to rush to invest a huge amount of money in it.

5. High demand for domains

Since the beginning of the commercial Internet, the demand for domains has experienced continuous growth.

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The past global pandemic has driven many people to adopt online activities. So this has fostered the expansion of the domain industry.

Businesses of all sizes are beginning to embrace a robust domain strategy and look for brandable domain names. This indicates that domain name flipping is a vibrant and profitable business.

Dangers of Domain Flipping

expired domain

Even though domain name flipping gives a lot of advantages, it is not without its own dangers. Domain flippers experience some typical dangers, which we will examine.

1. Be conscious of trademarks

Selling and registering a domain is a legitimate business. But, some issues can arise concerning their ownership.

If you buy domains that breach another business trademark, you can be wrongly accused of what we call cybersquatting.

So, before you buy and sell domains, check for copyrights, domain blocklists, and existing commercial names. You should also do a search on the United States Patent and Trademark Office database. This will help you verify the originality of your chosen domain name.

2. No guaranteed profit

As with any investment, there is no assurance that the price will go beyond the buying price. Some domain manes can be sold in a few weeks. Some may need months or years before they are sold.

The value of domains is much more personal and difficult to predict. So, if you are starting with domain flipping, first start with a low budget and increase it when you now understand the process.

3. Taxed earnings

The money you make from this business is taxable. So, ensure you keep a proper record of your sales and profits.

This will help you report accurate figures on your taxes. You can talk with a professional financial advisor to plan better investments.

Now that you are aware of the advantages and dangers of domain flipping, it is time to walk you through how you can build a good domain portfolio and increase profit.

How to Build a Great Domain Portfolio and Increase Profit

 domain investor

Understanding how to increase profit and grow your domain portfolio is important. So, below are some methods to apply that will help you gain the benefit of domain flipping.

1. Prioritize conventional domain TLDs

Find the everyday, conventional TLDs like .com, .net, and .org. This is because these top-level domains are the most recognized.

.com is the most common TLD. It is used by almost 50% of all websites globally. So, you will have an easier time seeing buyers if you look for .com domains.

2. Choose a niche

In simpler terms, choosing a niche means to pick a spot and stay in it. The niche you pick can be based on:

  • A specific TLD. For instance, focusing on .net domain sales.

  • A category of keywords in a topic.

  • A particular type of website, like eCommerce housing brands.

Focusing on a niche helps you develop a level of focus and expertise. As you continue practicing, you will learn how to identify domains that buyers will be interested in.

3. Strategically increase your domain portfolio

Some domain flippers prefer to expand their portfolio by creating a different portfolio. You can achieve this by selecting domains in different niche markets.

For example, domains with trending TLDs expired domain names, and high-value URLs for new sites.

The essence of a diversified portfolio is that it preserves you against unforeseen industry changes. Changes that can result in a reduction in value for some specific types of domains.

4. Purchase domain names that are already taken

You can purchase a domain name that is already taken instead of a new domain that’s available. You can do this by negotiating with the owners to buy active domain names.

Access the domain’s value to make the right offer for the domain. Offer an amount lower than your budget but not too low, so your offer can be worth considering.

5. Try a defensive domain method

This domain method is a profitable strategy that seeks to defend brands or businesses from their competitors.

A typical example of the defensive domain strategy is flipping domains with typos, plurals, or misspellings of a common brand name.

Brands are always interested in buying those domains to take them away from competitors and frauds.

Conclusion

domain flipping

Domain flipping can be likened to repairing a house or clothing. The only difference Is that it can be done from the comfort of your home.

If you are willing to invest time and effort into market research and monitoring trends, domain flipping can be an ideal way to make money.

With everything shared here, you now understand how to flip domains. So you can now begin growing a small business or provide the service to clients. You can also develop a profitable side business.

If you are eager and ready to go in the domain-flipping business and hope to stand out, have an aesthetically pleasing and responsive website.

FAQs

domain name

What is domain drop catching?

This is one of the domain flipping methods that implies buying expired domains and registering them again under your ownership.

A good expired domain naturally brings a higher price, particularly if it comes with SEO value.

Do you need a budget for domain flipping?

The price of domain flipping is determined by the domain purchase. The standard cost of a domain name is about $10-$15 per year.

This is based on the domain type and where it is registered. The method of sales also affects the cost of domain flipping.

How much can you make from domain flipping?

The amount of money you can make from domain flipping depends wholly on the price your domain can bring.

For a beginner, you can make around $100 to $10,000 by flipping domains. But, experienced domain flippers can flip underrated domains for millions of dollars.

How much can you sell domains?

There is no fixed amount for selling domains. You can sell domains from as low as a cent to as high as millions of dollars. The sales price depends on the buyer’s view of a domain value.

What makes domains worth money?

Valuable domains are usually short, memorable, and brandable. Domains that have a strong and positive history, relevant keywords, high traffic rates, and SEO authority are expensive.

Is domain business legal?

Yes, it is legal. The method of buying and selling domain names is entirely legitimate. Just be careful to avoid cybersquatting when flipping domains that have the same trademark or copyright phrases.

 

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Oladejo Elisha

I'm a Digital Marketer, Blogger, Content marketer, and SEO expert with proven results. I’m detail-oriented, results-driven, and dedicated to helping my clients achieve their goals.

Whether you're looking to increase your website traffic or boost your online revenue, I can help you achieve your goals. Let’s work together.

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