What is Domain Flipping and How to Make Money Flipping Domains

You’ve probably heard of the term; real-estate flipping. A process where someone purchases some real estate at a low price makes some renovations to the property and then sells it at a higher price, or rents it out with the aim being to make some profit on that property at the end of the day. That is exactly what domain flipping also means. You buy a domain name at a low price, keep it for some time and eventually sell it to make a profit.

You’re not sure what a domain is? Not to worry, domains are things you use every day to access various websites. They are addresses specifically made so humans can easily remember them rather than trying to remember IP addresses that are just strings of numbers. Domains are made up of the website name and an extension. Examples are twitter.com or even google.com. The extensions here are the .coms. There are, of course, other extensions like .edu, .gov, and so on.

Just like real-estate flipping, and as you can probably guess from the title of this article, domain flipping can be a very profitable venture. Let’s get into how you can make money by domain flipping!

How You Can Make Money by Domain Flipping

Currently, there are more than 140 million domain names with the .com extension already registered. Imagine that. Only .coms, not website names with other extensions. This means is that the internet is becoming more popular (sounds impossible, right?) and a tool more people are now willing to use. New websites and domains are, therefore, registered every day.

When a business (or anyone really) intends to get a website, they very often have something specific in mind. Domain names should ideally represent the general brand or an idea they intend to pass to site visitors. And most times, they are more than willing to purchase those domain names if they are already owned by someone else.

In truth, there are only two main steps to flipping a domain. These are; getting a domain name and selling it.

  • Getting a Domain Name: Again, there are two ways to add a domain name to your “portfolio.” You could come up with something new and then register it or buy an already existing one. Let’s cover each of them.
  • Coming up with a new domain name: This could be tough, especially when you consider that well over 200 million domains are already registered. However, if you manage to come up with something new, and brandable it could increase your potential profits. On the other hand, you can’t just come up with anything. You want something people are most likely going to want soon (I go into what makes a profitable domain later on. Keep reading!)

For now, let’s assume you have a great domain name idea, which you believe you could flip. How do own it? Easy! There are three services we would recommend: Bluehost (best for blogs and websites), Domain.com (if you want to register a domain name without having to create a website), and GoDaddy, the largest domain name registrar in the world. For all of these services, all you need to do is search to see if the domain name you’ve thought of is available and register it in your name.

  • Buying a domain name: If you intend to buy a domain to flip it, the best way to get that domain would be through an auction. Domain auctions are the same as regular auctions, except it’s all on the internet. When bidding for domains, make sure you do not overbid. When trying to bid for domain names check out GoDaddy Auction, Flippa Marketplace, and NamePros Forum. Sedo is also a great platform to buy at a fixed price or anonymously negotiate with a seller. Note that domains you are buying at auctions and anywhere else are also sold to you by someone who is trying to flip that domain, so when biding, be sure that the domain is worth it.
  • Selling a Domain Name: After purchasing a domain, there are some common ways to allow a new buyer to find it. However, before we go into that, you should always always wait for the interest in a domain to grow before you even think of selling it. Sometimes, this could take years. Flipping a domain is not always a fast process.
  • Setting a Price: After getting a domain, you can list it for sale at a set price. The price you set it at should be something that gives you enough profit, and you are comfortable to wait for. It should be a price that even if it takes a year for a buyer willing to meet your price to show up, you’re comfortable with that. Sedo is a great platform to set a fixed price when you want to sell a domain.
  • Minimizing Your Effort: This is another strategy where you buy to hold. It requires the seller not to make any visible effort to sell the domain, apart from making the registry this public. This way, even though the seller is not saying anything, they have put their information out for buyers to contact them. As a seller, when a prospective buyer reaches out, you can then negotiate with the person.
  • Creating a Landing Page: This method is quite common these days. Sellers create a landing page for the domain, so visitors can immediately see that the domain is for sale. Most times, the landing page also contains some information on how to contact the seller.
  • Listing at an Auction: This is one of the fastest ways to sell a website. It’s not always as profitable as the rest, but if the domain name is good, you could still make a profit up to four times the amount you spent to get the domain name. If you’re looking to auction, check out GoDaddy Auction, Flippa Marketplace, and NamePros Forum.

Is Domain Flipping a Profitable Venture?

Generally, domain flipping comes with its risks, just like every other business. However, the good thing is that it all depends on you. According to SEC filings, cars.com was sold for $872 million. Not just cars.com, other domain names have also been sold for similarly insane prices; carinsurance.com sold for $49.7 million, insurance.com for $35.6 million and these are just a few. So, there’s profit to be made, but at the same time, you need to spend time understanding which domains to invest in to generate substantial profit.

Another thing to be very conscious of while domain flipping is timing. Knowing the right time to buy and the right time to sell a domain is very important. The best time to purchase a domain is just when interest begins to gather around that particular subject. For instance, if you bought a domain related to electric cars back when a lot of conversation started building around that, it would have been perfect. To sell the domain for maximum profit, it’s best to wait for when interest is at the peak, and your domain is related to an area everyone is looking to get in.

What makes a profitable domain?

There are some factors that could increase the possible profitability of a domain name. Let’s take a look at them

  • Easy to remember: No one wants a website their customers can’t remember. If you own a website, you’d want something customers can easily type in to visit. For that reason, when you are getting domains you hope to flip, they should be easy to remember, simple, and short if possible.
  • Niche related: Domain names should mean something, relate to a brand or a business. However, be careful so your domain name is not too related to something that is already trademarked, a lot of court cases have come from that.
  • New extensions: Domain names that have extensions which have just been created are usually very profitable. Why? A lot of people want one. If you are quick enough to register some, you could make some good profit from that.
  • Keyword focused: Domain names that are focused on specific keywords could be very profitable. When people search for that keyword, the website with that domain is likely to pop up, so a lot of people would love to get that domain name.
  • Geographical: Domain names that refer to a specific geographic locality like a town or city combined with a possible business are usually very profitable. A good example could be NewYorkCars.com or PhillyBurgers.com.

Expired Domains

Expired domains are usually very profitable because they might have some SEO value, depending on the quality of backlinks they have. Yes, by the way, domains expire if they are not renewed. When a domain is about to expire, the owners still get a 30-to-90-day renewal period. Should they fail to renew it within that time, new buyers can pick it up. This is usually referred to as domain-drop catching and, it is a very popular practice. If you would like to find some expired domains or domains about to expire, you should visit justdropped.com and expireddomains.net.

Maintaining a domain

Domains are generally not difficult to maintain. After registration, all you have to do is always renew before they expire. Also, make sure to lock your domain name to prevent it from being transferred without your permission.

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