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Why You Should Get a Domain Name Appraisal

Kristie Leong M.D. is a family physician with experience in affiliate marketing as the owner of a successful website.

A domain name appraisal can be a useful tool in negotiations when selling a domain name, or in determining the value of a domain name for insurance purposes. It is also a good way to get an idea of how much your domain name might be worth if you ever decided to sell it.

A domain name is considered an asset, just as a home or other property is, although it only exists online. If you develop a domain into a brand or use it to generate revenue, it's a type of intangible asset, and one you should know the value of.

Know What Your Domain Property Is Worth

A domain name appraisal can help you to assess the worth of your property and set the best price point in an open marketplace. It makes sense from a financial perspective to get an accurate assessment before you list or sell. Otherwise, you may not get the full value of your domain name. What determines the value of a domain?

Domain name pricing is subject to many factors, including:

  • How many people are searching for the domain, and how often.
  • How long the domain name has been registered.
  • How it ranks in the search engines (i.e., Google--freshness).
  • The length of the domain name (shorter is better).
  • Prior sales of the domain name.
  • How it is marketed online (i.e., website, email address, other ads etc).
  • The quality and level of content on the site (if any).
  • The amount of activity on the site.
  • Brandibility.
  • Whether it's a top-level domain (.com).
  • Keywords in the domain name.
  • Memorability of the domain name.

Knowing the appraised value of your domain shows you how to price it. You wouldn't sell a house without an appraisal, why would you sell a digital property without one? Beyond getting the full value of your online property, there are other reasons to get your domain appraised.

You Can Show the Value to Potential Buyers

Once you have an appraisal in hand, you can show it to prospective buyers to show them the domain has value. Likewise, if you're buying a domain name online, it would be foolish to drop a significant amount of money without a domain appraisal. An appraisal shows you have something of value.

You'll Know the Value of Your Domain for Tax Purposes

It's possible you own a high-value domain and don't even know it. When you're tabulating your assets for your own knowledge or for tax purposes, know how much it's worth. You bought it for a reason, right? Don't be in the dark as to its value.

How to Get a Domain Appraisal

Now that you know a domain appraisal is important, how can you get one?The most capable people for appraising domains are domain brokers, who specialize in determining the worth of a domain name. The appraisal is the broker's opinion of what the domain name is worth based on their experience and comparable sales.

Some domain brokers will base the cost on the number of name records you want assessed. It is important that you have a domain broker that specializes in this service, as they can offer expert advice on domain names in your category.

The more names you want appraised, the lower the price per record. Using professional brokers also ensures confidentiality, privacy, and integrity.

The Do-It-Yourself Approach

You can also perform your own domain "appraisal" by checking comparable prices with online auction sites like Flippa and Sedo. However, looking at single sales won't give you the full story. A domain broker has the experience, based on many appraisals and the advantage of knowing what hundreds or even thousands of domain names have sold for in the past. They're best qualified to give you an accurate appraisal. If you have a desirable domain name, it's worth tapping into their expertise.

Know Your Domain Name's Value

A domain name has value, yet most people have no idea what their domain name is worth. Don't sell yourself short. There may be a time when you want to sell it and need to know its value. Once appraised, keep a copy of the appraisal so you can show it to potential buyers in the future.

Even if the appraisal isn't exact, it will give you a sense of whether or not it's a valuable asset. If it's not, you can always sell the domain or let it expire if you don't plan on branding it or building a business around it.

References:

  • "Domain Name Broker." domainnamebroker.com/home.
  • "Appraise your name - Vip Domain Broker." vipdomainbroker.com/appraise-your-name.html.
  • "Domain Appraisals - Sedo." /sedo.com/us/services/domain-appraisal/.

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.