I’ve been reading some of the domain blogs and unless I missed some articles it seems like there’s only been two gTLD domains that resold that have been talked about, X.Ventures and Tire.Guru. There has now been over 100,000 gTLDs purchased, and less than a handful of resold domains. Usually when something new and exciting comes out that people desire there is a lot of flipping at the beginning (think when the iPhone released, or a stock IPO, etc..). This is not exactly a great statistic of having a handful resold out of 100k+ bought. I have purchased a few gTLDs but they are ones which I plan to develop unless I get an unexpected great offer (I do think that a gTLD domain could look good in Google’s SERPS and would help drive clicks by looking trustworthy to people). I would expect the resale market go be very very slow for these gTLDs and I’ll tell you why…

I believe a huge chunk of the domains bought have been bought by investors/speculators. The best of the domains where the domain makes sense using the right of the dot with the left of the dot (example: something like Flawless.Diamonds) were probably purchased at premium prices. What kind of multiple does an experienced domain investor expect? If he spent $3k on a Day 2 purchase he is most like going to hold out for what? $20k, $30k or around there at least if not more.

If an end user was going to pay $30k for the domain then they would have bought it for $12k or $3k or whatever in the first place, but if they didn’t then why would they pay $30k a month later? Because they didn’t know about the extension and didn’t have a chance to grab it you might say. If they didn’t know about the gTLDs and now they do, good luck convincing them to drop tens of thousands on one. Is it possible, yes, but more likely not for a few years and only if the extension goes mainstream for their industry.

So what will happen? The domain owners who paid a good chunk to preregister the domain early, and who have to pay some sort of renewal premium are then going to raise their asking prices. In Year 1 they may have wanted $30k, by year 5 they may be asking $40-50k. As the price goes up the number of potential buyers goes down.

There are over 600 new strings coming out. My advice is don’t drop all your cash on these. People are rushing in now but by the time the 600th string comes out how many people will still have cash to spend? If you want to get in on the gTLDs then you might find better value later on as people use up their cash on domains that I think they will have a hard time selling (at least in the short term and quite possibly in the long term too).

6 comments on “So Is 2 Sales a Good Sign?

  • None of these 2 were resold.
    X.ventures is not yet sold and tire.guru (and a few others) were go daddy pre-registration auctions.

    Finde.singles was sold at Sedo for 2000 Euro. I have heard of a couple more but not confirmed.

  • I view the new TLDs as very risk for the average domain investor. They should only constitute no more than maybe 2 percent of a portfolio and even then only by very carefully evaluating the keyword/tld combination (does it make sense for a business), acquisition cost, renewals and seriously discounting the potential end user price given that these will not yield anywhere near .COM or more established TLD end user prices. Thus far I have not acquired any but I reserve the right to register a few.

  • X.Ventures- Typical new tld “hot air” with this name. Expect a lot more of this kind of stuff and would throughly research every claimed sale because there will be a big inceptive for people to “prime the pumps” given the lack of sales right now.

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