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Aftermarket prices keep climbing - retail sales not. Answers?

Labeled as discuss in Domain Buying and Selling Discussion, started by Dot Com Realty, Apr 4, 2020

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  1. Dot Com Realty

    Dot Com Realty Account Closed (Disallowed)

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    Like many of us, we notice that aftermarket sales are stubbornly high - very overpriced IMO. With retail prices not gaining on the low and mid range, the margins are getting tight - if you are bidding all the way up. I have a strict buying strategy and do not like to chase names up into the sky. And so, I have not won a domain in many weeks. Like Warren Buffet at the end of the economic cycle, he sits in cash as everything is too expensive.

    I like to search to see who is buying at high prices. Last two months I saw deep pockets on a couple names, and large Chinese and lndian investors, but mostly small time investors - clearly newbies. In checking the winners' portfolios I see a lot of junk - these are the ones (in my case) who are doing the crazy bidding. Oddly, I saw no hugenames in there. That was a first. Seems their algorithms are not that stupid.

    I am mostly siting on the sidelines watching the amateurs throw tons of money at expired domains, but smart money wins in the long run. I would imagine the dumb money runs out of steam at some point, and prices get back to wholesale (or retail climbs dramatically to justify the costs of acquisition).

    Any thoughts on this?
     
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  2. wwwweb

    wwwweb Top Contributor VIP ★★★★★★★★★★

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    Good topic, people are to focused on fast profits, and not the essentials in the background that affect domains, like don't be paying top dollar for travel related domains right now unless you have a really long term target. There are so many variables you have to focus on, these get rich courses give examples that are those one off outliers, very hard to hit twice. So basically most of these buyers have unrealistic expecatations.
     
  3. Riz M.

    Riz M. EmpireNames.com VIP Gold Account

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    a lot of big investors are now isolated in home with bags of money and feeling domains are best investment right now plus also flood of enduser is coming in. so obviously market will grow more nearly...enduser demand is increasing because all offline businesses are now thinking to go online and for that they need first domain.. so they are going for exact match names with there companies name.
    we will see more jump very soon.
    IMO but its just me...
     
  4. biggie

    biggie Restricted (Chatroom)

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    Hi

    I think some prices are rising because...
    not every buyer looks at price and compares it to "todays market value" or TMV

    that's a term that's often used by domainers to justify an offer or justify their selling price

    but those who look beyond "today", and who are willing to take and can assume the risk...
    will likely bid more, than those who are fixated with TMV's

    you have those who want to buy and make a quick sale shortly after, they have the tightest budget
    then you have those who'll buy high and sit on it until TMV is higher than what they paid, or they get great offer or until death do them part.

    imo..
     
  5. clarkemarketing

    clarkemarketing Top Contributor VIP

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    Anyone else think auction prices are MUCH higher today compared to the beginning of the year? They must be up at least 50% in my opinion, I can't win anything anymore! At GoDaddy, bidder 913932 (HugeDomains) wins almost every single decent two word .com regardless of how insane the price gets, and many one word .net .org and .co go for near retail prices. I recently saw a .org go for more than the .net was publicly BIN listed... how you gonna make money off that? I barely even bother visiting DropCatch anymore as I haven't seen a good deal there in months.

    The great news is many of the domains you own are worth substantially more today than a year ago. The bad news is it will be difficult to turn a profit on anything you buy today unless you get lucky or are extremely selective about what you buy.
     
  6. Heisenberg.d

    Heisenberg.d Established Member

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    Those big domainers play on quantity. They have money and they don't give a damm about the actual value of names. If they want it they gonna get it.

    Domain sale is unpredictable at best. One hand register domain can be sold at high $$$$$$ amount, This is up to buyer willingness to pay.

    So the whole point is if you own more domains you are more likely to be able to sell some, which can give you enough return to fill the gap.

    Also, every domain is unique and because we don't have any alternative as of now they are only going to be more valuable assets over the course of the period, renewing cost is very cheap and big domainers are going to keep it for long period once acquired.

    The only problem is that they are killing the market for small investors like us. Better to start looking for other alternatives Like new TLDs or even new possible trends and think about long time investments. Public Auctions are full of BIG FISHES.

    ( If there is plenty of BIG fishes in the sea better start looking for New SEA )
     
  7. Shimmy

    Shimmy Established Member

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    August was the first month in like 8 years that I didn't buy even one domain. I was way outbid on everything. I don't see any reasons why prices will ever got down again. So, I just tripled all my current prices and I'm just glad I have enough inventory to keep making sales for years in the future.
     

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