How to Make Money by Flipping Domains

The popularity of domain names has introduced domain flipping as a viable and growing business opportunity that can provide you with a steady income. The year 1985 marks the beginning of domain names, with the first domain being registered as Symbolics.com. Since then, the number of registered domain names has grown to over 363 million in the first quarter of 2021.

In today’s article, we will explore domain flipping in more detail and go over the following:

Domain flipping is when you buy a domain name with the intention to sell it later on for a higher price than the one you originally paid for it and make a profit.

Domains are like online real estate, and domain flipping is similar to flipping houses. Domains have become a very profitable business because companies and individuals are willing to pay a lot of money for exclusive names, especially for the shorter ones.

Domain flipping is a completely legal process! Many people make a living, either full-time or part-time, by buying and selling domain names. The only issue domain flipping can bring you is if you buy a domain that is clearly related to an active business.

Unlike domain squatting, which is illegal and done in bad faith, domain flipping won’t get you into any legal trouble as long as you’re mindful not to buy copyrighted domains.

Learn how to find domain

The first step is to search for domains that have potential and are worth buying. Here, it would help if you focused on finding affordable domains whose price will increase in the future, making them profitable and worth flipping. You can use many tools to help you find quality domains at low prices, including Spamzilla, Domain Hunter Gatherer, Domainr, etc. You can also search for domains at domain auctions, where they are currently being sold. Additionally, you can look for expired or dropped domain names on websites like ExpiredDomains.net and JustDropped.com and choose the one you want from there.

Learn how to estimate the value of the domain

Next, you need to select the domains which will be worth more in the future so that you don’t end up overpaying for a domain that no one wants and will not sell at a profit. When picking a domain name, make sure it fulfills the following checklist:

• Length – Shorter domains are more in-demand and preferable and can sell for higher prices than longer domains. Pick the domain that has the shortest name for maximum value.

• Memorability – The domain names that are easy to remember and pronounce are the most valuable because people will remember the website more easily if its name is memorable. You can research examples of memorable names by googling which are the most demanded names and look for your domain name based on the results.

• Brandability – Brandable domain names have to have all of the listed features and are domains that are already registered but not used. They are created with the goal to be sold to a specific buyer and brand and are relevant for a particular business. You can find such domain names or look for ideas for brandable names on sites like Brand Bucket, Brandroot, etc. Brandable domains are the most sought-after are turn the largest profits.

• SEO friendliness – It’s vital that the domain name is SEO-friendly and includes the relevant keyword. These domain names tell customers exactly what the business is about, are more likely to get clicked, and help the site get a better overall ranking. If the domain name has a keyword with more than 200 searches each month and if people are bidding on it for Google ads, then it will sell for quite a high price.

• Extensions – Numerous extensions are currently available for domain registration. Just in 2012, ICANN introduced over 1200 new TLDs. The most used and preferred extension is .com, and the domains that have this extension are the most valuable ones. Out of the 26 million generic TLD domains, more than 52% of them are registered as .com. Next in line are the .net and .org extensions. However, many other extensions also offer great and short domain names that are already taken with the mentioned extensions. For example, you can use a country-specific extension and target local buyers by offering them a domain name that they cannot get with the .com or .net extension. The extensions here would depend on the country. For example, if you target Morocco, the extension will be .ma. Note that even though these are country-specific extensions, the businesses that use this type of extension can operate worldwide. Of course, not all of the newer extensions will have considerable value because of the multitude of options available, but some of them are definitely rising stars that are becoming more popular each day.

• The backlink profile – Is a collection of links that direct users to the relevant domain/site. The building of backlink profiles is costly and takes time, and having a domain with a robust backlink profile already in place will drive the price up significantly. You can use Ahrefs to help you evaluate the backlink profile of the domain to see whether it’s worth buying.

These domains are the most popular and will bring you the most considerable profit. Make sure to find or create a domain name that suits your budget and has some if not all of these points. If you want to find out which domain names are the most expensive, click here.

Buying the domain name

This process includes the following steps:

• Picking a reliable domain registrar – After examining the value and choosing the domain name you want, you need to pick the registrar where you will buy and register your domain. Make sure to check the prices for this service for multiple providers before you make your decision.

• Checking if the domain is available – You have to check whether the domain you settled on is available and is not trademarked or being used by someone else. For example, Verpex’s domain availability checker tool is located on the domain registration page.

• Buying and registering the domain – After picking your registrar, you enter your domain name in the search engine and buy it. With Verpex, once you type the name you want, it will give you the results, which will tell you if your domain is available and how much it will cost. The cost of registering a domain name with Verpex depends on the extension and billing period. It’s worth noting that you cannot own a domain permanently regardless of the registrar you choose; you can only rent it.With Verpex, for example, you pay annually, biennially, or every ten years to lease the domain name.

• Verifying ownership – After the purchase, your registrar will send you an email to the address you provide during the registration. All you need to do is click on the verification link in the email, and you can officially say that you own that domain

Finding the right buyer

Can be tedious, but it’s a very important step. You should do a proper search before you choose a buyer because you want to find someone who will understand the true value of the domain name and be willing to pay a fair price. Some of the most popular methods of finding buyers are:

• Domain auctions- Are the fastest way of selling, and they usually last about 30 days. Posting your domain name on auction sites can attract many interested buyers, and if by the end of the 30 days your domain doesn’t reach the price you want, you can negotiate with buyers after the auction ends. You can also set a reserve price to sell your domain for your desired price, but that prevents bidding. It’s worth knowing that you might have to relist your domain multiple times before selling it at the price you want. Some domain auction websites are GoDaddy, Sedo, Domain.com, etc.

• Contacting potential buyers directly – You can try to sell your domain name directly to the buyers, depending on the business your domain is relevant to. For example, if your domain name is comfycafe.com, you can directly reach out to café owners. To find potential café owners, you can use tools like YellowPages to narrow down the search.

• Domain marketplaces – Listing your domain on marketplaces is the most common way to sell your domain. It would be best to list your domain on multiple marketplaces, like Sedo, Flippa, GoDaddy, etc. However, before you do, make sure to research the policies and fees of each marketplace to see whether it suits your needs.

• Domain redirection – Can be used to redirect the visitors on your domain to the listing or auction where you’re selling your domain, which will increase their visibility, and more users will know that you’re selling the domain.

• Domain parking – Includes placing ads on your domain while you wait to sell it. You earn money each time someone views or clicks on an ad, and it can be pretty helpful if you’re using an expired domain that already has traffic. Some providers that offer parking are Sedo, 1and1, etc.

• “Domain for sale” landing page –By creating a landing page on your domain that informs visitors that it’s for sale, you create the opportunity for visitors to send you direct offers without knowing how much others are offering for your domain. You can include a form on the landing page that provides visitors with a way to contact you.

• Making your WHOIS not private – Will increase the visitors’ ability to reach you and ask about the sale of your domain. Taking this step would mean making your email and contact information available and easily discoverable for everyone.

Selling the domain

Comes after you’ve implemented the steps mentioned above and found a suitable buyer. Once the price is agreed upon, the next step is to sell the domain, collect the payment and transfer the ownership. Seeing as domain fraud is a prevalent practice, you need to take steps to protect yourself and make sure the transaction goes smoothly. You can hire an escrow service to help you with the process, which acts as a broker between you and the buyer and makes sure that both parties respect the agreed-upon terms. The process goes as follows:

• Buyers pay the agreed-upon amount to the escrow service.

• Once the payment is received, the escrow service will inform you to transfer the ownership of the domain.

• After you do so, the escrow service transfers you the amount paid, less the fee they charge for the service.

• If someone violates the terms that were negotiated, the escrow service handles the issue.

Some providers that offer escrow services are Escrow.com, MangoPay, ShieldPay, etc.

• Patience is key because it can take a long time before you sell even one domain and start turning a substantial profit.

• Always research new domain names and keep up with what’s new.

• Don’t expect to be swimming in money and keep your expectations modest and practical.

• Take the time to learn some skills and gain experience and work on your domain flipping instincts.

• Don’t make hasty decisions when selling your domain because you might end up missing out on bigger future profits.

• Don’t only buy domains with the .com extension and research other ones because you never know what the future can bring.

• Take calculated risks when buying and selling and don’t be afraid to break the norm, but do it carefully.

• Take the experience of others as motivation but do not expect to hit the same marks as they do; everyone has their own journey.

• Don’t get discouraged if you make a mistake and try to learn something new from every move.

Domain flipping is considered low-risk because it has a low barrier to entry and does not require huge investments or expensive equipment. Also, your losses will probably be low, amounting to the price you pay for the domains you purchase. So, focus on keeping your costs low and plan out your purchases carefully.

However, something you should be mindful of is setting your expectations too high. It would be best if you didn’t go into domain flipping expecting to sell a domain for millions because someone else has done it. Try to focus on making modest and attainable profits at first and build your experience as you go.

You don’t need a lot of money to start domain flipping. There are domains that you can buy for $10 and later sell for $100, $1000, or more. Or, you can buy a domain for $10000 and sell it for less. So, setting a starting budget can be tricky.

However, most domainers start out with a budget of $500. This amount will enable you to buy quite a few low-cost domains with high potential. So, until you get some experience, it’s best to treat domain flipping as a side-business and not spend too much money on buying domains. Keep your spending within your means, and carefully make your buying and selling decisions.

Website flipping is buying and selling complete websites with content, reputation, traffic, revenue, growth opportunities, etc. This is where the value for the website comes from and, therefore, for the website itself.

With domain flipping, the thing that matters most is the name. Website flipping includes selling the domain name as part of the website.

Domain drop catching is a common strategy where other buyers can buy your domain before you can renew the registration. However, there is a redemption grace period that can last from 30 to 90 days, where you can renew the registration.

You can use this to your advantage, though. Namely, when a valuable domain name’s registration expires, you can track it and seize the opportunity to buy it for yourself. These domains are called expired domains and can be bought for a low price because the owners are not interested in them anymore.

The profitability of domain flipping depends on you. Each person makes a different amount and has different approaches. The income depends on your experience, skill, and also on luck. Some domains can sell for millions, but that is not a frequent occurrence.

However, you can make money even by purchasing a $10 domain and selling it for $80. This is a profit of $70, which you can repeat multiple times and make a lot of money. And for a side-business, it’s pretty profitable.

Flipping domains can be very profitable once you get the hang of it. It’s a low-risk business that requires experience, skill, and some luck but is not difficult to understand once you get started.

If done properly, it can become a full-time job and bring you large sums of money. However, this takes time, patience, and consistency. But the pay-off can be really high, which makes it worthwhile.