Second domain lease in the bag!

Phew, lot’s of emails and lot’s talking back and forth with business owners has taken a small step forward today with my second lease now signed and sealed.

I have a small furniture domain that I found for sale last year, I emailed the seller and he said he was open to offers, thankfully my first offer of £450 for it was accepted right away and it was added to the portfolio.

There are quite a few companies that specialise in specific types and styles of furniture and this domain was a type of wood, I sent out around 25 emails for this one to the top ranking sites and those using Adwords and had 2 interested companies within 2 days, this domain isn’t ranking yet so perhaps a bit early but I though worth trying.

As I am learning and speaking to people the details of the contract evolve so that everyone is happy, so the main changes I had to make and agree to were

  • A 3 year lease on the domain name
  • First refusal at renewal so they knew another company wouldn’t take it
  • Maximum 50% increase in the lease fee at renewal

Those are pretty acceptable terms and I was happy to write them in, the lease fee I decided upon was £75 per month. That means for a domain that cost £450 I will get £900 in the first year and £2700 over 3 years while still owning it.

Why £75? I would usually intend to get the cost price of the domain back within the first 12 months, so started at a price I could negotiate down from if needed.

What’s next?
A bit early as most of my domains are not ranking, I had one agree to £250 per month on another furniture domain that was ranking top 10 but it’s lost it for now so put that on the back burner and I have another someone is considering for £100 per month. Just yesterday I did manage to buy

  • ashfurniture
  • redwoodfurniture
  • cherryfurniture

All for £300+VAT and all .co.uk domains so they would be good candidates for this type of deal, on the whole I have found many quite responsive to the leasing option, I still got asked if I would sell and to give a price but sticking to my guns I prefer not to sell assets that I find too difficult to value, I’d rather lease for 3 years and see where the world is then and in the meantime build an income that is stable and create a business that is profitable and rich in assets.

Domain lease income : £575 per month

About Scott Jones

Scott hails from the north east of Scotland and started earning online at the end of 2000 building websites for local businesses during which time he won an award from Lord Alan Sugar for Excellence in Enterprise. After having quite a bit of success with domaining Scott mainly runs educational evergreen websites which generate over 3 million visitors per month but is always on the lookout for a fresh thinking out of the box way to turn a buck. Follow on Twitter.

Comments

  1. Nicely done. Sounds like an excellent deal!

    Was just wondering whether you lease the domain itself only, or you create a bit of content, get some rankings and then let them lease the domain and content?

    • Thanks Mike, I tend to put up a page with some text/info to get the domain ageing and possibly ranking but it’s of no value and the lessee would be welcome to use it, the contract is for the domain only.

  2. Good stuff. Nice strategy – never really considered leasing domains but I’ve got a few I might dust off and test the water. Thanks for the insights :-)

  3. Well done Scott… Understanding that the domain is not ranking well yet, and that as you say the lease is for the domain only… Are you going to get involved also in ranking the domain?

    • Not that one Jav, once leased I am finished and it’s zero maintenance income for 3 years, I will try and rank one’s I have in my portfolio to create more value and therefore get a better lease price but still offering no guarantees.

  4. Great work Scott. I like the philosophy of getting your investment cost back within 12 months if possible.

  5. Great stuff Scott. Do you put anything in the contract to cover you if the company goes under? Does a minimum lease period cover that? Also do you only use google as your ‘ranking’ guide, or does yahoo etc factor into it?
    I’m finding it tricky to get yahoo anywhere near my google results.

    • If the monthly payment (due on the first of every month) is not through to my bank by the 14th then the lease is terminated so I would then take back control of the domain. I rank quicker in Yahoo than Google so it helps a little with traffic numbers if trying to base my asking price on that.

  6. Smart, smart, smart. Congrats, I think you’ve found another niche!

  7. Congrat’s Scott! You’re certainly blazing a trail with the domain leasing. Great to see that it’s taking off. Makes me think I should try leasing out my futonfurniture.co.uk domain. It’s currently #4 on a Google.co.uk search. Any idae what it might be worth as a lease?

  8. It’s getting 1.45 visits per day, according to Google Analytics. Is that enough to garner interest, do you think? How well was your domain doing prior to leasing?

    • This one wasn’t ranking but had type-ins and some traffic from Yahoo so was doing around 300 visitors per month but was leased just based on it’s generic name, no stats were asked for.

  9. Do you write anything into your contracts to help deal with the possibility of the “renter” doing something unsavory with your domain?

Trackbacks

  1. […] a local ccTLD market like .co.uk domains you can buy on a budget and get a lot for your money, spending £450 and get a £900 return each year on it means money can be re-invested to grow a […]

  2. […] that is actively leasing domains and writes about it on his shared blog SelfMadeMinds, here: Second domain lease in the bag! Self Made Minds Lease a domain and triple its value Self Made Minds Domain Leasing – Become an Internet Landlord […]

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