A (relatively) overlooked data point when looking at domain name sales

When I first started buying and selling domain names I used the current top domain sales as my inspiration. I saw some nice two-word .COMs that were selling in the five figure range and went to town. Of course I quickly learned that I had bought a bunch of junk, it wasn’t just all one-word .COMs or two-word .COMs, it’s the quality that matters. But with quality comes the understanding that to get top dollar your time horizon has to be a lot longer than most.

And this is where new domain name investors get confused when they’re looking at lists of domain sales. Yes – the sales numbers are real, but the data you’re not seeing is the amount of time the domain owner was willing to say no, be patient, and wait for the right buyer to come along. Mike Mann for example usually hangs onto a name for more than five years before it sells:

(One thing to remember is that Mike Mann needs to sell about $2.5+ million worth of domains per year to break even and that he is NOT a flipper. The average holding time for his sold domains is usually more than 5 years.) (Source – OnlineDomain.com)

So here’s what happens. People look at domain sales, try to buy very similar names, then get frustrated a year or two later when “they haven’t sold yet!” What you have to realize is that you might have bought a great name, but the right buyer isn’t there for it now…the question is did you buy the name initially with the idea of waiting five or more years for a buyer?

If not then you might not be completely realistic when you’re trying to industry pros are doing. Rick Schwartz, the Castello Brothers, and many other top industry veterans are known for waiting for the right buyer and not looking for a quick flip when it comes to their top sales.

The question is, are you being realistic with yourself when you buy a domain that looks “almost exactly” like a domain that sold for a small fortune last week? Most people are not, especially in the beginning, and I know I wasn’t being realistic for years.

What do you think? Should domain name investor be paying attention to how long someone had a domain before it sold when looking at domain sales?

Morgan Linton

Morgan Linton