When you buy a domain as an investment, what’s your expected hold time?

Hold Time Domain Investing

Here’s a question that I’ve seen come up a lot over the years and just came up again from a new reader so I thought it was time for a fresh post about the topic. What I’m talking about is how long you expect to hold a domain name before selling it, hopefully, at the target ROI you’re looking for.

Now before I share my answer to this question I’ll note that there really is no right answer here, but like most topics, there are plenty of opinions and well, this is my blog so where better to share mine right? 🤷‍♂️

Most of the domains I sell move in the $2,500 – $7,500 range and I’ve typically found the average hold time for these is around five years. While I think you probably could set a lower hold time for yourself, you’d likely also have to lower your pricing a bit, my guess is you could cut that time in half if you decided to focus on the $1k – $2k range.

Of course, this data isn’t that useful unless we share the type of domain, and for me it’s two-word .COMs, that’s been my focus for years and I don’t see it changing anytime soon. Over the last 5-6 years I’ve added .IO and .CO to the mix along with a few .VC names here and there but I can’t say I have enough data to really know what the true hold time is for names in those extensions.

I do think the hold time for a domain investment varies based on two critical factors:

  1. The domain itself
  2. Your expected ROI (and floor)

Investors I know with one-word .COMs will often hold for 10+ years before selling a domain whereas people I know that want a quick flip will go for two and three word .COMs priced in the $100 – $200 range. There’s no winning formula for domain investing, just different paths you can take.

All that being said, I’m curious to know if there is some overall number investors have in mind when they buy a domain when it comes to liquidity? I feel like I’ve been settled on the five year mark for a while now but I know I could change that in one direction or the other if I changed the type of domain I invest in and the ROI I’m looking for.

So now I’ll hand the mic to you – when you buy a domain, how long to you expect to hold it for before you sell it? I want to hear from you, comment and let your voice be heard!

Disclaimer: The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.

{ 8 comments… add one }

  • Ed Keay-Smith July 6, 2021, 10:41 pm

    Hey mate

    My typical hold time before a sale is 2-5 years and occasionally under 2 years hold time.
    I just sold a LLLLL.co for US$10k this week which I am waiting on the money coming through but will update once cleared.

    Most of my sales are in the .com.au space between US$2 -10K and mostly short 2 word domains.
    Occasionally I will sell some .co.uk, .co & .in domains to but only a few a year.

    Cheers

    Ed

    Reply
    • Morgan July 6, 2021, 11:19 pm

      Thanks for sharing Ed and congrats on the $10k sale 🙌 Not a bad way to kick off the month!

      Just don’t tell more people about .COM.AU, better to tell people the market sucks and there’s nothing to see here 😂

      Reply
      • Ed Keay-Smith July 7, 2021, 1:09 am

        Thanks Morgan

        The com.au space is a tricky space to participate in due to its regulations so no worries there.

        I like to have a variety of domains so always some .com, .co. .net & .io in the mix too.

        I hand registered NonAlcoholicGin.com about 10 days ago and it gets type in traffic. It doesn’t happen often but happy when it does.

        Cheers

        Reply
  • Matt Ledingham July 7, 2021, 12:27 am

    Five years. Most of my names are two-word .coms as well. Of course, I have many names that I have been holding much longer.

    Reply
  • Bar July 7, 2021, 4:24 am

    My average sale time is 334 days … so basically a year. While that’s the actual data, I expect to hold onto names for 3-5 years before they sell. Some much longer if I paid a lot for them and am asking a lot.

    Reply
  • Gregg July 7, 2021, 4:32 am

    Forever.

    Reply
  • Jeff Schneider July 7, 2021, 7:42 am

    Hello Morgan,
    Our emphasis, has always been a reverse psychology, when compared with others in the (.comEPA) space. We purchase stand alone Business oriented names rather than Industry category names,. Its our preferred niche.
    Our collection of names are Legacy in nature, and Created, for the most part, in the late 90s.

    So our holding time parameters are very different parameters than others in the Industry. We from day one, let the secondary market in (.comEPA’s) dictate our holding periods, All our Platforms are long term in nature. We don’t negotiate on anybody else’s terms, through E-mails, Texts, or any other, truly Quasi-forms of Non-direct Communication. Suitors need pick up the phone and call us, for live interactive Communications or Direct Eye to eye Contacts. We do not make outbound Calls, and very early on in point contacts with Suitors, We make it very clear, Diplomatically, they need to initiate call backs if interested, We are not in the game of chasing them down.
    Our overall negotiating style, is how our Platform can solve their needs in a cooperative manner. We don’t pull any punches, and are direct about what our needs are for Closure.
    We Qualify them, not the other way around. JAS 7/7/2021

    Gratefully and Respectfully, Jeff Schneider
    (Contact Group) METAL TIGER
    Former: (Rockefeller I.B.E.C. Strategic Marketing Analyst/Strategist)
    (Licensed C.B.O.E. Hedge Strategist)
    Domain Master: ( UseBiz.com ) / ( USeBizcom )

    Reply
  • Jose July 9, 2021, 1:10 pm

    Hi Morgan,
    You know me very well, I have been very stubborn for the belief that two to three years was the best, and it was not like that.
    I was losing money and not making up for it.
    My strategy changed when I met a Digital Marketing Startup in Spain, we talked and reached an agreement, I delivered my portfolio of domains with CPC $ 5 and higher and make a lot of money through landing page.
    Then remember your comments that you made me in my beginnings and change the strategy again only 1 year for domains with CPC lower than $ 5, so on according to the CPC 2, 3, 5 years and right now I have more than 10 domains (Com) That exceed the CPC $ 40 in the long term although in fact I want to sell through Domain Broker.

    By the way next Monday they give me the first Pfizer vaccine.

    Good weekend.

    Reply

Leave a Comment