First I have to quantify this post by saying I don’t know anything about domaining so these are my thoughts on the subject but that doesn’t mean anyone should take it as advice or the like 😉
Domain names, well certainly the good one’s, brandable one’s and generic one’s are all snapped up, more and more people come to the internet each day looking to make money, build websites and start businesses. It seems to me that perhaps it is early days now but the domain market will mature at some point.
Good domains should rise in value, I think most people would agree with that, I also think there should be a lease market that will develop at some point. Think about the high street in any major city that you know of, how many for sale signs do you see up in the main shops? Very rare. People/businesses that own shops know that rather than sell a shop in a prime location for a quick buck they can lease their shops to generate an income, all the time owning an asset that can continue to rise in value.
Side street shops come on the market just like poorer less desired domains but high street premium real estate shops & also domains are rarer. I don’t think it would actually cost that much money to build a portfolio for the future and become an internet landlord.
Sticking with .co.uk domains you can get good domains that would fit a specific niche for £50-£300 quite easily, I bought replica weapons on Sedo last night for a couple of hundred, that type of domain fits the bill for what I plan to test out.
Get some decent domains that you can lease, they have to be the obvious & best domain in their niche and in a market that lends itself to selling nationwide and of course online.
Do some research, look for specialist magazines and especially companies that advertise in these magazines but don’t show a website address. If you think everyone has a website of some form nowadays, you’d be wrong.
Contact companies offering them the prime online real estate in their genre for a fair set monthly fee.
Couple of initial thoughts spring to mind;
What would the length of the lease be?
Lease the domain for 1 to 2 years at a time with a renewal option to give security to both sides. Possible option or first refusal to buy the domain should it ever be for sale. Termination penalties or lack of would have to be agreed upon.
What if the person leasing the domain uses it poorly and gets the domain banned?
If I bought a domain for £200 I would be looking to lease it out for around £50 per month so the domain should long since have paid itself back, although misuse & provisions against certain content could be written into a contract. Advice can be given to avoid misuse by mistake.
How to add extra value to a domain for lease?
Get it indexed and ranking for it’s main term. If someone wanted to sell led bulbs and I had ledbulbs.co.uk for lease and it ranked in the top 10 in Google.co.uk that would have to be an attractive proposition.
I’d be happy to hear your thoughts on this, probably to early in the evolution of the internet for it to be mainstream but I will be taking a few of my domains and I will do research and legwork to see if I can lease any of them out, I’d rather try it and fail than not try at all and wonder.
Rather than park domains or develop them it would be very satisfying to own 50 leased domains that rose in value and generated an income that wasn’t dictated by Google or rankings, why sell a domain for a quick cash injection when you could lease it to recoup your full investment and still own the domain that rises in value. It would also solve the problem of finding real content for domains.
Ach..I’ll give it a shot… to infinity and beyond!