People have been investing in real estate for a long time, and if you were lucky enough to be in a family that bought property a long time ago, you’ve probably seen firsthand how the value can skyrocket over time. The median price of a home sold in the US in 1970 was $23,600, today it’s $231,000 (source – Yahoo Finance). My guess is that you know someone who invests in real estate, and likely more than one, real estate investing has taken off as a way for people to make either a primary or secondary income.
There are popular television shows about buying real estate and then flipping it for a lot more than you paid in as short a time period as possible. The stars of these shows aren’t buying the property to live in themselves, they’re buying it to resell for a profit, and people around the world at watching, learning, and getting into the real estate investment game themselves.
Starting in the 1990’s, people started buying and selling domain names. Imagine going back to the early days of land ownership, before electricity, before just about every single creature comfort we have today. That’s where we are when it comes to digital real estate, it’s still a very new concept. There isn’t a single TV show about domain name investing, but blogs like DNJournal and DNW.com have been covering the domain investing world since the very early days and conferences like NamesCon and The Domain Conference bring investors from around the world together every year. The foundation is there, just think of real estate investing in the 1,500’s…these are still the very early days for domain names.
As a relatively new investment vehicle, domain names are still new territory when it comes to pricing, sales, etc. While there is a formalized system and appraisal approach used with physical homes, the same does not exist for domain names. The challenge is that the average person doesn’t realize there’s been an entire industry taking place around investing in domain names.
Instead, when most people think of people who own domain names, they think – squatter. Here’s the problem with that term. The same term applies in the real estate world, but it’s pretty easy to tell between a real estate investor and a squatter. Here’s the definition of a squatter:
DEFINITION of ‘Squatter‘ A person who settles in or occupies property with no legal claim to the property. A squatter is one who resides on a property to which he or she has no title, right or lease. A squatter may gain adverse possession of the property through involuntary transfer.
So if someone is occupying your property and unwilling to move but with no legal claim to it, then they’re squatting. Let’s apply this same term to domain names. A squatter would be someone with no legal claim to the domain name yet claims ownership and/or will not transfer it back to the legal owner.
Just like real estate investors aren’t squatting on the property they legally buy, domain investors are not squatting on the property they legally buy. It’s that simple. Yes – sometimes people squat on domain names just like they squat on homes, those are squatters. In the digital world squatting often means violating a trademark which means the owner doesn’t have the legal right to own the name. In the real world people squat in homes, in fact in some cases squatters make it next-to-impossible to sell your home/investment property (here’s an example).
I agree – squatters are suck. Let’s just make sure we’re clear on the term because just like we wouldn’t call someone who legally buys and sells real estate a squatter, we shouldn’t apply the same term to people who buy or sell domain names.
Or should we? You’ve heard my two cents, now I’d love to hear yours. Comment and let your voice be heard!