Domain Name Valuations and Appraisals
Hey everyone! Thank you so much for joining me on today’s DNAcademy podcast. My name is Michael Cyger, and I’m here to help you become a more profitable domain name investor.
Four words for you when you are doing domain name valuations or appraisals:
Domain Name Valuations and Appraisals Roadmap
Characteristics => Comparable Sales => Pricing
If you don’t remember anything else about domain name investing, domain name valuation and domain name appraisals, start with those four words.
Because if you remember those four words, you can likely fill in all the other gaps in your investing knowledge.
Let’s start with an example we can all relate to: physical real estate.
When you’re in the market to buy a house, you run comparable sales to determine the fair market value for the house you want to make an offer on.
Domain Name Valuations and Appraisals Example
Let’s say you like this house in the Queen Anne district of downtown Seattle, a short, 1.2 mile walk to Amazon.com’s headquarters. How do you determine if the asking price of $2.2 million is fair?
You look at comparable sales for that house, of course.
But in order to search for comparable sales, you need to determine the characteristics of the house you want to buy so you can find similar houses that have sold, right?
It doesn’t make sense to pull comps for houses that sold on the banks of Lake Union with a water view, if the house you’re looking at is land locked.
And if the house you’re looking at is two bedrooms, why would you pull comps for four or five bedroom homes?
If you were a Realtor or real estate broker, you know that there are a lot of factors to take into account when valuing or appraising a house and finding comparable sales. Characteristics like location, age, house size, number of bedrooms, number of bathrooms, total room count, property size, amenities, style of the house, quality of public school district, and curb appeal, among others.
The same is true for domain name valuation and appraisal.
Domain Name Valuations and Appraisals Characteristics
There are 23 characteristics that define the quality of a domain name.
Domain name characteristics include: the top-level domain, word count, character count, search volume, keyword type, radio test, pre- and appending, plural and singular, and word placement, among others.
Going into the details of each of the characteristics is beyond the scope of this video, but suffice it to say that each characteristic is a lesson in itself.
Domain Name Valuations and Appraisals Comparable Sales
Identifying how a domain name meets each of these characteristics then allows you to find PROPER comparable domain name sales.
Domain Name Valuations and Appraisals Pricing
From that point, once you have the right set of comparable domain name sales, you can then calculate what the retail price of your domain name should be.
In DNAcademy, I also teach you how to determine the likely maximum value — if the stars aligned and the highest and best use case buyer came inquiring about the domain name.
And I also teach you how to determine your wholesale value, which is the price you should aim to buy the domain name at. Which is also the likely price you could liquidate the domain name for in the future to another investor.
Once you understand the 23 characteristics, how to find proper comparable sales, and how to determine your retail, maximum and wholesale values, you will never again ask for help in valuing or appraising a domain name. You will know how to properly properly do domain name valuations and appraisals.
Domain Name Valuations and Appraisals Summary
If hope you found benefit from this video and it’s been helpful to you in your domain name activities.
If you want a structured methodology with a step-by-step roadmap and set of tools that teaches you to invest more analytically, consider signing up for DNAcademy.
Thank you so much for making the decision to watch or listen to the DNAcademy Investor Insights blog.
My name is Michael Cyger and I’m here to help you become a more profitable domain name investor. Please subscribe to this podcast, and I’ll see you in the next episode.