How domain investing actually works: what it costs to hold names, where good names come from, how they sell, and the mistakes that eat most beginners' budgets. Written from a working portfolio, without the hype.
Disclosure: I run SelDomain and Zero IQ, which makes Dométric and DotHold, two apps mentioned below. Everything else here applies whichever tools you use.
Most guides to domain investing open with a story about a name bought for ten dollars and sold for a fortune. Those sales happen, but they are the exception that keeps people trying, not a picture of the business. After about five years and a portfolio of around 270 names, this is the guide I wish I had read first.
What domain investing really is
Domain investing is buying names you believe someone will want more than you do, holding them while you pay renewals, and selling some of them for more than their total cost. The key word is some. In most portfolios, only a small share of names sells in any given year, and some never sell at all. The sales that do happen have to pay for everything else.
That makes it closer to a slow inventory business than to trading. Your results depend less on finding one brilliant name and more on three habits: buying carefully, controlling holding costs and pricing realistically.
The cost nobody puts in the headline: renewals
A domain is not bought once; it is rented year by year. Every name you hold costs a renewal fee every year until it sells or you let it go. Those fees look small per name, but across a portfolio they become your biggest expense.
Two rules have saved me money:
- Know the renewal price before you buy. Promotional first-year prices and registry-premium names can renew at much higher prices than you expect.
- Review the portfolio every year. For each name up for renewal, ask: would I register this today at this price? If the answer is no, let it go. Dropping weak names is part of the job, not a failure.
I built Dométric partly because tracking renewals, costs and sales across hundreds of names in a spreadsheet stopped working for me. Any system will do, as long as you can see what each name has cost you so far.
Where names come from
There are three main ways to acquire names, each with a different risk profile:
- Hand registrations. Registering an unregistered name at the standard fee. Cheap per name, but most hand registrations never sell, so they work best when you have a specific reason: a new technology term, a new extension that suddenly means something (as .si did in 2026), or a name with an obvious buyer type.
- Expiring and expired names. Names that owners did not renew, bought through backorders, drop catching or registrars' expired-domain auctions. Competition is strong, but this is where many aged, previously used names come from.
- The aftermarket. Buying from other investors or owners. You pay more upfront, but you are buying names that already passed someone's filter, and you can study comparable sales before you bid.
Beginners tend to over-register. A few well-chosen aftermarket names are often a better use of a small budget than hundreds of speculative registrations.
How to judge a name before buying
The factors are the same ones buyers use: length and simplicity, the extension and its liquidity, real meaning, pronounceability, demand across extensions, a clean history and the absence of trademark problems. I go through each one in [10 Factors That Increase a Domain's Value](/blog/10-factors-that-increase-domain-value).
A quick filter I use before any purchase: can I name a realistic type of buyer, and can I find a few recent sales of similar names? If I cannot answer both, I pass.
Trademarks: the fastest way to lose money
Names that only make sense because of someone else's brand are not investments; they are liabilities. Under ICANN's UDRP, a trademark owner can have a bad-faith registration transferred to them, and you lose the name and what you paid for it. Some countries also allow damages.
Generic words, phrases and invented names with many possible uses are far safer. When a name happens to match a brand in one industry, sell it passively rather than pitching it to that company.
How names actually sell
Most of my sales have come from buyers who found a name on their own, not from me finding them. So the job is mainly to be easy to find and easy to buy from:
- List names on marketplaces with a clear price or a sensible minimum offer.
- Point every name to a for-sale landing page, so anyone who types the domain sees that it is available and how to buy it.
- Offer lease to own where it makes sense. Young companies often can't pay a large price upfront but can pay monthly.
- Use outbound carefully. Contacting companies that could use a descriptive name can work, but keep it relevant and never target trademark owners.
Pricing: wholesale or retail
Every name has two prices. Investors pay wholesale, because they need room to resell. End users pay retail, because the name is worth more to the business that will build on it.
Both are legitimate; the mistake is mixing them up. I've received investor offers that were a fraction of what I'd ask an end user. From their side, those offers were reasonable. Decide which buyer you are waiting for, and price accordingly. If you price for end users, accept that sales will be slower.
A free estimate can help you find your bearings. Our [Domain Appraisal](/appraisal) tool shows both a wholesale and a retail value, and DotHold does the same on iPhone, but treat any estimate as a starting point, not a promise.
Riding a trend without getting burned
New trends create real opportunities. In 2026, .si suddenly gained a second meaning as shorthand for super intelligence, and the aftermarket followed with notable sales. But trends also bring a flood of new registrations, and many speculative names will never sell.
My approach: buy a few of the best names early, price them on actual comparable sales rather than headlines, and don't renew the weak ones once the excitement fades.
Mistakes I'd avoid if I started again
- Registering too many names too quickly. The renewals arrive whether the names sell or not.
- Ignoring the extension's liquidity. A great word in an extension with few buyers can wait years.
- Pricing on hope. Asking prices that ignore comparable sales mostly produce silence.
- Skipping trademark checks. One dispute can wipe out the profit of several sales.
- Not tracking costs. Without knowing what each name has cost, you can't tell which parts of a portfolio actually make money.
Is it worth it?
Domain investing can be profitable, but it rewards patience, discipline and honest pricing far more than luck. Start small, buy names you can explain to a buyer in one sentence, keep your renewal list under control, and let the evidence, not the headlines, set your prices.