Picture a plumber's nephew who notices his uncle's company is stuck on a clumsy web address. He finds the clean version sitting unregistered for about $12, buys it, and a year later a rival firm pays him enough to cover his renewals for a long while.
Maybe you want something you can do from a laptop in the evenings with very little cash. Your wages have stalled, the bills keep growing, and the side hustles everyone pushes on social media look crowded. Domains feel different because they reward knowledge of a trade you already have.
There is pressure here too, and it is about discipline. Every obvious dot-com went decades ago, and the good names left in your trade get registered a few at a time by people who search before you do. Those who learn valuation and renewal discipline now keep their best names. Those who buy in bulk on hype end up paying renewals on names nobody wants.
Fresh names cost about $12 each, and $50 to $1,000 buys a first batch small enough to track. At a 1.5% sell-through, a portfolio of 200 domains produces three sales a year, and a decent hand-registered name selling for $1,800 is a good outcome. One to six months is the time to profit, the range on this page starts at $500 a month, and long quiet stretches sit in between.
Tonight, write out ten short names, under about 12 characters, from a trade you already know, then check at any registrar which ones are still free.
The pitch you have probably seen leaves out the hard part. Those headline sales sit on top of the real business: a portfolio of names that mostly do not sell, carrying an annual renewal bill, against a small number that do. Whether you make money depends almost entirely on two numbers most guides never mention: your sell-through rate, and the minimum commission your marketplace charges.
This guide walks you through both, along with the fee structures, the legal exposure, and the specific situations in which domain flipping is a bad idea for you.
Marketplace commissions are quoted as percentages, which makes them sound proportionate. In practice they bite harder on small sales, because the major marketplaces also enforce a minimum.
Sedo, one of the two largest aftermarket platforms, publishes its terms openly. Its marketplace commission is 15% on a sale from a Make Offer listing, an auction or a Buy Now listing. Its price list sets a minimum SALES PRICE of 20 USD/EUR/GBP on Category I TLDs, the category containing .com, .net, .org, .co.uk, .io, .ai and .com.au. There is no minimum commission on those. The 60 USD/EUR (45 GBP) minimum applies to its second category of TLDs, and the common ones are exempt.
Let me work that through with you. You register a domain for roughly $12, list it, and sell it for $100. A headline eight-fold return. The commission on a $100 marketplace sale of a .com is $15, the 15% rate. You receive $85, and after a $12 registration your profit is $73. Sell the same domain for $60 and the commission is $9, leaving you $51. A parked Buy Now listing runs at 10% rather than 15%.
The real drag on you is renewals. Every year a name fails to sell costs you the renewal, and most names never sell at all. Cheap domains are hard to flip profitably because the carrying cost compounds while the sale probability stays low. The minimum commission sets a hard floor beneath which the platform takes everything, which means the viable business is in names that sell for four figures or more. And those are much harder to acquire for $12.
Sedo's published fee list carries several other charges you should know before you list:
Afternic, the other major platform and part of GoDaddy, is harder to pin down. Third-party comparisons published in 2026 disagree with each other: some report a flat 20% commission reduced to 15% if you use Afternic nameservers, others describe a tiered structure of 20% under $5,000, 15% plus $1,000 between $5,000 and $25,000, and 10% plus $4,000 above that. Afternic's own pricing page did not serve a readable response when this guide was written.
If a buyer offered you $100 tomorrow, do you know to the dollar what would reach your bank account? If not, work it out for your chosen marketplace before you list a single name.
So you have seen what the platforms take off the top of a sale. What comes next decides how often there is a sale for them to take it from.
Sell-through rate is the share of your portfolio that sells in a year. Experienced domain investors track it closely, and beginners almost never calculate it.
Sit with that for a moment. At a 1.5% sell-through, a portfolio of 200 domains produces three sales a year. Those three sales must cover the renewal cost of all 200.
If your names are the kind that sell for $100 to $300, your portfolio loses money every year, quietly and predictably, while still feeling like a business because sales keep happening.
This is how most domain portfolios fail. The cause is plain arithmetic, far more often than a bad name or a missed sale.
How confident are you, honestly, that your average name would fetch close to $950? If you hesitate, start with fewer names and better ones.
Renewals at $12 a name are the bill that never stops arriving, so keep your portfolio small enough that a year of them comes out of a normal month without you noticing. That way a quiet year costs you a few evenings of research and leaves the household budget alone. Drop the names you would not buy again today.
That is the arithmetic settled. The question now is which names land on the right side of it.
Buyers of aftermarket domains fall into a few groups, and knowing who they are tells you what to buy.
Think about the trade you know best. Which business in it is still trading on a clumsy name, and what would they want instead? That gap is where your best ideas will come from.
Think about what one good sale could do. It could clear the overdraft, pay a term of your kid's music lessons, or simply cover every renewal in your portfolio for the year. One sale out of many names, chosen because you knew the trade better than the buyer's last web designer did.
The upside of expired names is that many carry existing backlinks and traffic. The downside is that you are bidding against professionals with better tools.
Every day, someone types the name you meant to register into a search box. Good hand registrations are rare and go to whoever looks first, while expired names get caught the instant they drop. If you know a trade well, start searching it this week, before the few clean names left in it are gone.
You have somewhere to look for names now. Putting a price on one is a separate skill, and getting it wrong costs you either the sale or the margin.
Automated appraisal tools give you a number instantly, which is exactly their appeal and exactly the problem. They are trained on aggregate data and are poor at the thing that sets value: whether a specific buyer wants this specific name.
Appraisal tools routinely value worthless names in the thousands. Sellers then price accordingly, list, and wait years. The tool is answering a statistical question that has little to do with an actual sale, so its number feels precise while telling you very little.
Use comparable sales instead. NameBio keeps a searchable database of publicly reported domain sales. Search for names built like yours: same length, same pattern, same category, same extension. The spread of those real completed sales is a far better guide than any generated estimate.
Two cautions on comparables. Reported sales skew high, because large sales get publicised and small ones do not. And a comparable tells you what someone paid once; it promises nothing about what the next buyer will pay.
Pick one name you like and find five completed sales that look like it. Did any of them sell for more than the $950 average you would need to break even? That single search will tell you more than any appraisal tool.
The Legal Exposure Most Guides Leave Out
Registering a domain containing someone else's trademark is a recognised category of dispute, with an established process for resolving it against you.
The Uniform Domain-Name Dispute-Resolution Policy (UDRP) lets a trademark holder file a complaint against a domain registration. If the complainant shows the domain is confusingly similar to their mark, that you have no legitimate interest in it, and that it was registered and used in bad faith, the domain is transferred away. You do not get your money back, and you pay your own costs.
Registering a name specifically to sell it to a trademark holder is close to the textbook definition of bad faith. So is registering a variant of a well-known brand, or a common misspelling of one.
This risk is real, and the complainant does not even need to sue you in court. Before buying any name that resembles an existing company, search national trademark registers: the USPTO in the United States, the IPO in the United Kingdom, EUIPO across the European Union. And do not buy if there is a plausible conflict.
Nothing here is legal advice. If a name is genuinely valuable and you are unsure, an hour with a solicitor costs little against losing the asset.
The Admin You Cannot Skip
Transfer locks. A newly registered domain, and a domain whose registrant details have recently changed, is locked against transfer to another registrar for 60 days under ICANN policy. This catches sellers who agree a sale and then cannot deliver in the time the buyer expects. Plan for it, and tell the buyer if a name is inside the window.
Escrow. Never accept payment for a significant domain by direct bank transfer or PayPal without escrow. Escrow.com is the established option, and marketplaces build the same protection into their own transfer process. The fee is trivial next to the risk.
Privacy. WHOIS privacy is standard and usually free, but a domain listed for sale needs a contact route. Use a dedicated email address rather than your personal one.
Tax. Domain sale proceeds are taxable. Whether they count as trading income or a capital gain depends on your jurisdiction and how you operate, and the difference can change what you owe a great deal. Keep records of acquisition cost, renewal cost and sale price per name from the start; rebuilding them later across a large portfolio is miserable.
A Worked Example
Here is a realistic first year, run honestly.
You hand-register 50 names at an average of $11, spending $550. You research each one against comparable sales rather than an appraisal tool, and you avoid anything resembling a trademark.
At a 2% sell-through, you sell one domain. Suppose it goes for $1,800. That is a good outcome for a hand-registered name.
Commission at 15% is $270. You receive $1,530. Against $550 of registration cost, you are up $980 for the year.
That is a real profit, and it is also roughly minimum wage for the hours you spent researching 50 names, listing them and handling enquiries. Meanwhile 49 names come up for renewal, and you must decide which to keep paying for.
Now run the same year where the sale is $300 instead of $1,800. Commission is the $60 minimum, you receive $240, and against $550 of registrations you are down $310.
Both years took the same effort and the same skill. What separated them was whether the name that sold happened to be worth four figures.
When the $1,800 year happens, decide in advance where it goes. After fees and next year's renewals, a sale like that could be the long weekend away your family keeps putting off, booked the week the escrow clears. The worked example also shows a $310 loss, so book the trip only after the cash has landed.
Could you take the $310 year without it touching your family's budget? If the answer is no, the first batch should be smaller than 50.
So waiting has a price, small and quiet. Another month where the clean name in your trade stays free for someone else to find. Start tonight with ten names and no spending at all, check them, and register only the one or two you would happily renew next year.
Who should skip this
You need income within twelve months. The sales cycle is long and the timing is out of your hands. A domain sells when a buyer appears, and you cannot make one appear.
You cannot afford to lose the registration costs entirely. A portfolio is a set of options that mostly expire worthless.
The headline sales are what drew you in. Voice.com was a lottery result, and it teaches you nothing about what a normal portfolio does. Treating it as evidence of an achievable outcome is the most common error in this field.
You find it hard to let names go. The discipline that makes a portfolio work is dropping names that have not sold, and that is psychologically harder than buying them.
You hope to automate it. Bulk-registering names generated by a tool is how portfolios pile up renewal costs without piling up value.
Domain flipping suits someone with real commercial instinct for how businesses name themselves, patience measured in years rather than months, money they can leave tied up, and the discipline to cut losses every year. That is a narrower group than the marketing suggests, so decide honestly whether you are in it before you spend anything.
Your First 90 Days, Realistically
If you are still reading, you have decided this one suits you. Here is what that first stretch asks of you before any money arrives.
Weeks 1 to 4. Learn valuation before you buy anything. Study completed sales on NameBio until you can predict roughly what a name sold for before you look. Register nothing.
Weeks 5 to 8. Buy no more than ten names, hand-registered, each with a written note of why you think it will sell and which specific type of buyer would want it. That note is what you will grade yourself against later.
Weeks 9 to 12. List them. Compare marketplaces on total cost including minimum commission, on top of the headline percentage. Set prices from comparable sales. Then wait, and track sell-through from day one.
Expect no sales in the first 90 days. That is the normal outcome, and it says nothing bad about you or your names yet.
Scams Aimed at Domain Sellers
Owning a domain that is publicly listed for sale makes you a target. The schemes below are well documented and come round again and again, and the first one catches more new sellers than every other risk in this guide combined. I would hate for it to catch you.
The appraisal scam. You receive an unsolicited offer, usually far above what the name is worth. The buyer is enthusiastic and moves fast. Then they explain that before going ahead, their process requires a formal appraisal, and they name a specific service. You pay the appraisal fee, typically $50 to $200. The appraisal comes back, and then the buyer either vanishes or says the valuation revealed a problem.
The appraisal service is controlled by the scammer, or simply pays them a referral. The domain was never going to be bought. Once you know the tell, you will always see it: a genuine buyer never requires you to pay for anything before a sale. They may want their own valuation, and they will pay for it themselves.
The general rule: never pay an upfront fee of any kind to complete a sale. Verification fees, transfer fees, release fees, certificate fees, legal processing fees: all are inventions.
Fake escrow sites. A buyer agrees terms and proposes an escrow service you have never heard of, or a site that looks like a known one at a slightly different address. You transfer the domain on confirmation that funds are held. The confirmation was fake and the site belongs to the buyer.
Escrow.com, which handles a large share of legitimate domain transactions, publishes guidance on spotting fraudulent escrow sites: hastily built pages, missing or false company information, and customer service numbers that ring out or answer with a generic recording. Insist on an escrow provider you chose yourself, or use the marketplace's own transfer process.
Fake broker approaches. A scammer registers a domain resembling a well-known brokerage, turns on WHOIS privacy to hide who owns it, and contacts domain owners claiming to represent a corporate buyer with a big budget. The approach is flattering and specific. It ends with a request for a fee.
Check a broker independently: find the firm's real website through a search rather than a link in the email, and contact them on the number published there.
Fraudulent renewal invoices. You receive an official-looking invoice for domain renewal from a company other than your registrar. Paying it either buys nothing or, worse, starts a transfer of your domain to the sender. Renew only by logging directly into your registrar, never through a link in an email.
Overpayment and reversal. A buyer pays more than agreed and asks you to refund the difference, then reverses the original payment. This is why irreversible settlement through escrow matters more than payment speed.
What all of these share is manufactured urgency plus an unusual payment step. A real transaction is slow, boring, and runs on infrastructure you chose. If a message makes your heart race, would you be willing to sleep on it before replying? That one night is usually all it takes for the scam to show itself.
Parking: Small Money, Still Worth Knowing
While a domain sits unsold, it can show advertising. Parking services including Bodis, ParkingCrew and Sedo's own parking product serve ads on the page and share the revenue with you.
Keep your expectations low. For a typical portfolio of speculative hand-registered names, parking revenue is negligible: often a few dollars a year across the whole portfolio, because nobody types those addresses. Parking only becomes meaningful for names with genuine type-in traffic: former active websites, common misspellings of popular destinations, or generic terms people type straight into a browser.
This is one reason expired domains with existing traffic sell at a premium over freshly registered names. A domain earning $30 a month in parking revenue pays its own renewal many times over and can be held indefinitely while you wait for a buyer, which changes the portfolio arithmetic entirely.
Two cautions. Parking a name that resembles a trademark strengthens a UDRP complaint against you, because showing competing ads is evidence of commercial bad faith. And parking revenue has been falling for years as browsers changed how address bars behave.
The Expired Domain Lifecycle
Knowing what happens when a domain is not renewed is what separates the people who pick up good expired names from the people who watch them disappear.
For most generic TLDs the sequence runs roughly like this, though exact periods vary by registrar and registry:
Expiry. The name stops resolving. The registrant can usually still renew at the ordinary price.
Auto-renew grace period. Typically up to 30 to 45 days, during which the original owner can reclaim the name at standard cost. Many expired names are recovered here, usually by an owner who forgot rather than one who gave up.
Redemption period. Around 30 days. The name can still be recovered at a much higher redemption fee, often $80 to $200 on top of renewal. Most names that reach this stage are genuinely abandoned.
Pending delete. Roughly five days. Nothing can be done; the name is queued for release.
Drop. The name becomes available. Anything desirable never reaches the open market. Drop-catching services fire registration attempts at the moment of release. If more than one service has interest in the same name, it goes to auction between their customers.
What this means for you: you cannot simply wait and register a good expiring name. You need a backorder placed with one or more catching services, and you should expect competition on anything genuinely valuable. Services differ in which registries they are effective at, which is why serious buyers place backorders with more than one.
Before you bid on any expired name, check its history. A domain once used for spam, adult content or a penalised site carries that history into your ownership, and a buyer doing diligence will find it. The Internet Archive's Wayback Machine shows what the site used to be, and it takes two minutes.
Are you prepared to compete in an auction against professionals for a name you want? If not, hand registration is the calmer place to begin.
Negotiating a Sale
Most domain sales are negotiated rather than bought at list price. A few principles hold every time.
Do not open with your floor. Buyers expect to negotiate, and accepting straight away tells them you priced too low.
Ask what they plan to build. A buyer with funding and a launch date behaves differently from one browsing. Asking is plain qualification, and it is fair. It also tells you whether you are talking to a business or an intermediary.
Do not say what you paid. It has nothing to do with the value of the name, and it drags the buyer's number down.
Be willing to walk away. Your strongest position in a domain negotiation is genuine indifference, because your holding cost is roughly $12 a year. That is a real advantage over the buyer, who wants this specific name and cannot swap it for another.
Read a low first offer as information. An opening offer of $200 on a name you priced at $5,000 usually means a small business rather than a funded company. That can still be a good sale. It is simply a different sale, at a different number.
Consider instalments for larger sales. Marketplaces support payment plans, which can close a deal a buyer cannot fund all at once. The trade-off is that you hold the name until the final payment.
Payments from a four-figure name sold on instalments arrive in pieces, and that suits one particular use well. Each instalment that clears could cover a month of your parents' phone and electricity, and they hear from you that this one is handled. Later payments can still stop, so offer help from cash already received and read the plan terms before you agree.
When a buyer says $200 and you were hoping for $5,000, what will you say back? Write your reply now, while no one is waiting on you.
Regional Notes
United States. The deepest aftermarket, with dot-com dominant. Sale proceeds are taxable; whether they are ordinary income or capital gain depends on whether you are treated as a dealer, and that depends on how often you sell and why. Talk to an accountant before your first significant sale rather than after.
United Kingdom. Dot-co-uk has a real domestic aftermarket, though prices sit well below dot-com equivalents. Nominet runs the registry and operates its own dispute resolution service, separate from UDRP and in practice cheaper and faster for complainants. So trademark exposure on a dot-co-uk is, if anything, easier to enforce against you.
Australia. Dot-com-au historically required an Australian presence and a connection to the name, which held back pure speculation. Eligibility rules have been reformed and keep changing; check current registry policy before you buy, because a name you cannot lawfully hold is a name you cannot sell.
Canada. Dot-ca requires a Canadian presence to register. That restriction narrows the buyer pool and also narrows competition among sellers.
Everywhere, the same rule applies: a country-code domain sells into that country's market. Do not assume a British buyer for a name that only makes sense in American English.
Keeping Records That Survive a Tax Enquiry
A domain portfolio creates a large number of small transactions across several platforms, and piecing them together years later is genuinely hard. Set up your system before you need it.
For every name, record the acquisition date, acquisition cost including any auction premium, registrar, renewal date, every renewal paid, and the eventual sale price with commission deducted. A spreadsheet is enough; your discipline matters more than the tool.
This matters beyond tax for two reasons. It gives you your sell-through rate and the true cost per name, which is the only honest measure of whether the portfolio works. And it forces each yearly renewal decision onto evidence rather than attachment.
Keeping all your registrations at one registrar makes the record-keeping much easier, at the cost of putting your eggs in one basket. Most investors accept that trade.
Could you tell someone right now, without looking, what your names cost you to hold last year? If not, the spreadsheet starts tonight.
Pricing a Name, Step by Step
Pricing is where most portfolios go wrong in a way you cannot see for years. Price too high and nothing sells while renewals pile up. Price too low and the minimum commission eats the sale. Here is a method that holds up in practice.
Step one: find twenty comparables, where most people stop at three. Search completed sales for names that match yours on structure rather than meaning. If you hold a two-word dot-com combining a common adjective and a common noun, search for other two-word dot-coms of that shape. Pattern matters more than meaning, because buyers are pricing a category.
Step two: throw away the top and bottom. The highest comparable sold to a buyer with an unusual reason, and the lowest went to someone who caught a motivated seller. Neither predicts your outcome. Work with the middle of the spread.
Step three: adjust for extension honestly. A dot-net or dot-org equivalent usually sells for a fraction of the dot-com, and the discount is bigger than sellers want to believe. If your comparables are dot-com and your name is not, cut the price substantially; a token reduction will fool only you.
Step four: set the Buy Now above the middle, and a floor you will genuinely accept. The listed price works as an anchor for the buyer, and nobody should read it as a forecast. The floor is the number below which you would rather keep paying $12 a year. Decide it before a buyer appears, because deciding it mid-negotiation leaves you with regret whichever way you go.
Step five: check the floor against the minimum commission. If your floor is $150 and the marketplace minimum is $60, you are netting $90. Ask yourself whether that justifies the years of renewals. Often it does not, which tells you the name should never have been registered.
A note on Buy Now versus Make Offer. Buy Now converts more sales and converts them faster, because many domain buyers want to complete a purchase without a conversation. Make Offer keeps open the chance of a higher price from a buyer who really wants the name. The honest trade-off is that Make Offer brings you more enquiries and fewer sales, and many of those enquiries are the scams described earlier.
For most portfolios of moderate names, Buy Now at a researched price beats Make Offer, because your time answering enquiries has real value and the upside on a $2,000 name is limited.
The Portfolio Mistakes People Keep Making
Buying on volume. Registering 500 names because each is only $10 creates a $5,000 yearly bill for a portfolio you cannot justify name by name. Quality does not average out; renewal costs do.
Falling for keyword tools. Software that builds available names by combining high-search-volume keywords produces exactly the long, unpronounceable, multi-word names that never sell. Search volume for a phrase says nothing about whether a business wants to be called it.
Mixing up traffic and value. A name with type-in traffic has parking income and a plausible buyer. A name with search volume for its keywords has neither, unless a business wants the brand.
Renewing everything. The yearly renewal is your portfolio's only pruning tool. Using it properly means letting go of names you were once excited about, which is the hardest discipline in the field and the one that decides long-term profit.
Ignoring the extension's renewal price. A promotional first-year registration at $2 that renews at $45 is a trap, and a common one among newer TLDs. Check the renewal price before the acquisition price, because you will pay the renewal many more times.
Selling too cheap out of relief. After two years of silence, a $250 offer on a name you value at $2,000 feels like vindication. Holding is usually better, because one buyer arriving is weak evidence that another never will, and your holding cost is trivial.
Treating an unsolicited approach as validation. Most unsolicited offers on a listed domain are lowballs or the appraisal scam. A genuine buyer usually comes through the marketplace listing; a personal email out of nowhere deserves suspicion.
Which of these mistakes do you recognise in yourself from other hobbies or investments? The one you nodded at is the one to write on a note and keep beside your renewal list.
What Your First Sale Teaches You
Nearly everyone who completes a first sale reports the same two surprises.
The first is how much the fees take. A $1,200 sale becomes $1,020 after a 15% commission, then less again after payment processing, and it arrives weeks after the buyer agreed. Thinking in net figures from the start saves you that disappointment and, more importantly, changes which names you buy.
The second is how ordinary the buyer turns out to be. You picture a corporation with a budget; usually it is a small business owner who wanted a better name and negotiated hard. That is useful to know, because it tells you what to buy next: names ordinary businesses need, over names that merely sound impressive.
Domain flipping rewards patience, arithmetic and a willingness to be wrong about names you liked. It punishes volume, urgency and attachment. If that trade appeals to you, start small, track everything, and judge your portfolio on sell-through rather than on the one name you are certain about.
After You Accept: How the Transfer Works
The sale only happens when the name is delivered, and sellers lose deals here all the time because they do not know the mechanics.
A domain moves in one of two ways. A registrar push moves the name between accounts at the same registrar. It is fast, often instant, and the smoothest option when you and the buyer happen to use the same provider. A full inter-registrar transfer moves the name to a different provider and takes up to five days, and it requires you to lift the transfer lock on the domain and supply an authorisation code, sometimes called an EPP code or auth code.
Before you agree a completion date, check three things. Whether the name is inside the 60-day post-registration or post-contact-change transfer lock. Whether WHOIS privacy needs turning off for the transfer to go through, as some registrars require. And whether your registrar adds its own hold after a payment method change.
Where escrow is involved, the sequence is: the buyer funds escrow, escrow confirms funds are held, you start the transfer, the buyer confirms receipt, and escrow releases payment. Do not transfer before funds are confirmed, and never accept a screenshot as confirmation: log into the escrow account yourself.
If a buyer you met on a marketplace pushes to finish the deal outside it, say no. Marketplaces charge commission partly to handle exactly this, and that request often comes just before the buyer fails to pay.