advice Preparing yourself for a recession as a domain investor during an economic downturn

[Eric Lyon]

The news started to hit the press everywhere in April and May 2025 with concerns of a recession in late 2025 due to several different factors that may potentially trigger an economic downturn, at least in the United States of America, that is, and potentially on a global scale.

Because of that, I wanted to touch base on how a domain investor can potentially navigate a recession by focusing on both, the negative aspects and the positive (potentials) that come with a recession for domain resellers/investors.

Note: Please do not comment about politics in this thread. The thread is intended to help domain investors navigate a potential recession and not for political debate. If you want to talk politics, please use the following: political thread, instead.

Let's start off with a couple references that triggered my interest in this subject:

• In early April, J.P. Morgan Research raised the probability of a recession occurring in 2025 to 60% — up from 40%.
• The latest unwinding of the Liberation Day tariffs reduces the shock to the global trading order, but the remaining universal 10% tariff is still a material threat to growth and the 145% tariff on China keeps the probability of a recession at 60%.
• J.P. Morgan Research now expects the Fed to start easing in September, with further cuts at every meeting thereafter through January 2026—reaching a 3% policy rate by June 2026.

Source

Torsten Slok, the chief economist at asset management titan Apollo Global Management, wrote last month he believes there’s a 90% probability the U.S. will fall into a “Voluntary Trade Reset Recession,”

Source

Specifically, the probability now stands at 72%, marking a 20% increase over the past week and the highest reading of the year, according to the latest data retrieved by Finbold from market betting platform Polymarket on Wednesday, April 30.

Source

The articles above should be considered "speculation". The potential of a recession is not definitive, but is enough to make sure one is prepared in the event it does come to fruitation. At the same time we can all cross our fingers and hope that there will not be a recession in the near future.

With that said, let's dive right in...

Domain investing during a recession has different types of challenges and opportunities:​

Challenges:

• Reduced End-User Demand: During an economic downturn, businesses and individuals may cut back on non-essential spending, including the acquisition of premium domain names for new ventures or upgrades.
• Lower Liquidity: Selling domains can become more difficult and take longer as fewer potential buyers are actively looking and investing.
• Price Depreciation: Like other asset classes, the perceived value of domain names, especially those not tied to essential industries, may decrease due to lower demand and economic uncertainty. Some experts suggest domain prices fell significantly during past recessions.
• Startup Funding Slowdown: Recessions often lead to less venture capital funding for startups, which can impact the demand for high-end domain names favored by new tech companies.
• Investor Sentiment: Domain investors themselves might feel the pinch of a recession, making them less likely to invest in new domain names or renew their existing portfolios, especially if they are facing financial constraints.

Opportunities:

• Buying Opportunities: If you have cash reserves, a recession can present opportunities to acquire valuable domain names at lower prices from owners who need to liquidate assets. This could include reaching out to owners who previously rejected your offers.
• Increased Entrepreneurship: Job losses during a recession can lead to a rise in new small businesses and individual ventures, potentially creating demand for more affordable, entry-level domain names.
• Focus on Value and Necessity: Domain names with clear commercial value or relevance to essential sectors (like healthcare, utilities, or discount retail) might hold their value better or even see increased interest.
• Optimizing Your Existing Portfolio: A recession is a good time to review your domain portfolio, forecast renewal costs, and identify domains that are unlikely to sell or generate revenue. Pruning your portfolio can help reduce expenses.
• Increased Online Presence Importance: Businesses that maintain or even increase their online presence during a recession may find it crucial for survival and future growth, potentially leading to domain-related investments down the line.

Strategies for Domain Investing in a Recession:

• Cash Flow Management: Focus on extending your cash flow by carefully forecasting renewal costs and being conservative with sales expectations.
• Optimize Sales Channels: Ensure your domains are listed on major marketplaces with clear "buy now" prices to facilitate quicker sales.
• Segment Your Portfolio: Categorize your domains into "must-renew," "potential sell," and "uncertain" to prioritize your investments.
• Be Conservative with Valuations: Recognize that buyer budgets may be tighter and adjust your pricing expectations accordingly.
• Explore Buying Opportunities Carefully: If you have capital, research and target valuable domains that might be available at discounted prices.
• Focus on Strong, Versatile Domains: Prioritize domains that have broad appeal and are not overly reliant on specific industries that might be heavily impacted by the recession.
• Consider Domains Related to Growing Areas: Even in a recession, some sectors might experience growth. Identifying these areas could lead to valuable domain investments.
• Maintain a Long-Term Perspective: Recessions are temporary. Focus on the long-term value of your domain assets and avoid panic selling.
• Be conservative with sales forecasts: Assume that domain sales might decline during a recession rather than improve. Any sales above your baseline forecast should be considered a bonus.

While a recession can bring challenges to domain investing, it also offers unique opportunities for those who are strategic, have available capital, and focus on long-term value. Careful planning and a realistic outlook are crucial to navigating this period successfully.

Again, don't panic, it's just speculation of the potential a recession may happen in 2025. This thread is just a reminder to always be prepared in the event something like this actually happens.

Remember, at the end of the day, a domain name is truly only worth what a buyer and seller agree on.

What works for one may not work for another and vice versa.

Happy domaining.

 

[bmugford]

Bad economy = more buying opportunities.

However, that doesn't really help if you can't afford renewals.

Brad

 

[Future Sensors]

Bad economy = more buying opportunities.

However, that doesn't really help if you can't afford renewals.

Renewals in Euro have become so affordable since 47th. It results in approximately 10% cost savings.

#makerenewalsgreatagain

 

[karmaco]

Can't be any different than the downturned domain market of the last 4 years. We are used to it.

 

[Gabriel360]

Can't be any different than the downturned domain market of the last 4 years. We are used to it.

For those of us who sell a handful of domain name per year, a recession is just another Tuesday.