Are LLL domains a good investment?
Great question...It would be hard to argue they will not continue to be powerful investments in the future.
LLL domains in the top extensions have been power performers for the last 5 years, realizing year over year value growth of almost 100% a year (on the wholesale market). End user sales are increasingly common in the $xx,xxx to $xxx,xxx and even $x,xxx,xxx realms.
As a wise domainer once said to me several years ago, one of the best things LLL domains have going for them is the very fact that "they don't make any more of them." His implication is that there are indeed only 17,576 LLL combos possible per extension, and none more can be made. This then limits the supply, so demand now is the driving force in the LLL marketplace.
Two comparisons hold great weight in regards to LLL domains: the comparison to the stock market and the comparison to the real estate market.
LLL domains do work like stocks in that there are a finite number of "shares," for which all have possible dividends (earnings such as ppc) and can be sold easily in the wholesale marketplace. End-user purchases would represent a buy-out of a particular set of shares.
On the real estate side, LLL domains are limited just as land is limited. As a population (of businesses, individuals and governments) grows, the desire for property to meet their needs grows, but the property itself is limited. Fixed property and higher demand yields higher prices, especially for premium land, but even also for lesser than prime land. This land can be held in the mean-time by speculators who can use it to earn income (a nice bonus).
So what do both of these models say about the futuer of LLL domaining? The key to LLL growth remains internet demand. As demand grows (as more and more individuals, businesses and other entities desire prime internet addresses that are memorable, easy to brand and well fit for their business purposes, ie meets their business acronym needs, to reach an ever growing internet audience) then the prices will likely continue to grow. Supply is limited to the 17,576 combos, but supply is actually decreasing slowly, as more and more end-users attain LLL domains from the available saleable supply.
Thus, as supply dwindles and demand grows, prices most always increase. I can admit there are more factors at play than just economic ones, but many investors are beginning to view the current LLL landscape as a prime investment space that is currently undervalued (even with the recent strong price growth of the last few years). It would be hard to imagine, in my humble opinion, any investor in LLL domains in the top extensions regretting their ownership of these domains in the coming years down the road.
Great topic,
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zesty