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Domain name appraisal

Posted on 2004-09-22
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Last Modified: 2010-04-27
I'm not sure if this question belongs in this thread or not so feel free to move it.

I have a domain name that I've had a few offers to buy for anywhere from $1000 - $8000. My first question is how do I know what is a fair price? I understand it's a lot about how bad the prospective buyer wants it but there has to be some other way to get an idea.

Also, once I decide to sell it, how do I make the transaction without getting ripped off? Obviously I'm not going to take Joe buyers check and hope it clears. I looked at escrow.com but that looks like a safeguard more for the buyer than the seller.

Any ideas?
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Question by:webweever
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humeniuk earned 150 total points
ID: 12124453
You could use a domain name appraisal service, like www.adnappraisals.com or www.accuratedomains.com/index.php.  Remember, though, that appraisals are merely guidelines and the true value, as you pointed out, is the market value - ie. whatever you can get for it.

In general terms, some of the key elements to determining value of a domain name are:

- the extension - .com is worth more than .org or .net, which are worth more than .cc, .us, etc.

- number of letters and words - the shorter the domain name, the more it's worth, a one word domain name (ie. homes.com) is worth more than a two+ word domain (ie. buyhomes.com)

- specificity - if the words/names in the domain name are very specific to a product or subject matter of the website, the value is increased

- is it memorable - if a domain is memorable (whether because of the reasons above, ie. simplicity, or any other reason), it will be worth more

- correct use of words - domains that correctly use real words (such as 'easy' instead of 'ez') are more valuable than those that don't.

In terms of making sure you don't get ripped off, I think Escrow.com is a good option that will afford you both some protection.  You could also use a domain broker like www.domainmart.com.

Alternatively, you can make sure that payments is recieved and verified (ie. if you have to wait for the cheque to clear) before transferring the domain name.  For the protection of the buyer, prepare a letter outlining the terms of the arrangement, sign it, and send it to the buyer.  Then, the buyer will have a signed letter outlining the terms from you and the cleared check to verify any claim of ownership.  Most registrars would take that pretty seriously.  It would be far easier for the buyer to claim ownership of the domain name under this scenario than it would be for you to collect the unpaid money.

I hope this helps.
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by:duz
duz earned 100 total points
ID: 12125810
webweever -

>My first question is how do I know what is a fair price?

The concept of a 'fair price' is a mythical one :) There is only one price and that is the 'market price' i.e. what someone is prepared to pay for it.

If you want to sell it you have to 'tell' the market it is for sale and then the market will determine the price for you.

So the first thing to do is to advertise it.  The best and hottest places to do that can be deduced from studying the 'Where Sold' column on this page and it's archives http://www.dnjournal.com/domainsales.htm also ask in forums devoted to the subject - there is a list of forums  on that site as well.

>how do I make the transaction without getting ripped off?

Use escrow.com and insist the buyer picks up the charges https://www.escrow.com/index.asp

- duz
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