Someone recently commented to me that the price of a domain name I own is so high that I will probably die with it and my kids will inherit it. The comment made me laugh – and that person made be right. His comment made me think about great .com domain names as generational assets.
Families have passed down valuable assets from one generation to the next forever. Real estate, artwork, jewelry, collectibles, metals, businesses, and many other asset classes can appreciate considerably over time. I think exceptional domain names, one-word .coms for example, can be considered in the same class of assets that can drive wealth for the next generation.
If you’ve been tracking the domain name market, there are certain types of domain names that have continued to appreciate in value. As more domain names have been registered and more extensions have become available, there continues to be demand for .com domain names. I expect that to continue since the biggest brands in the world use .com domain names and the companies that are growing the fastest seem to want their matching .coms badly enough to pay eye watering amounts to secure them.
There may be dozens or hundreds of companies that share a brand term, but there is just one brand matching .com domain name. If the company truly wants to own that brand, they need to pay up to acquire the matching .com domain name. I think companies are paying more today for one word .coms than ever before, and I expect the values will continue to rise.
There is an important distinction between domain names and many traditional generational assets. The cost of ownership is extraordinarily low for domain names. Real estate is expensive to own and keep. There are taxes, maintenance/upkeep costs, as well as management expenses. Hard assets such as jewelry, art, metals, and collectibles have costs such as insurance and storage fees. Even if someone doesn’t insure them and doesn’t store them, the risk of loss is high.
A great .com domain name can be maintained for a small annual renewal fee. Beyond keeping it securely registered, there is very little cost required to preserve the asset and valye beyond using good security and maintaining ownership records and associated accounts.
This doesn’t apply to every domain name. While there are some extensions and types of domain names that are popular now and could stay popular for an unknown period of time, I wouldn’t really consider much else to be generational assets.
I earn a living selling domain names. However, there are quite a few domain names in my portfolio that I would be okay not selling because they should continue to grow in value for our kids. I am teaching our kids about good domain names, so they will look at them as valuable assets into the future should I not sell them.
This is absolutely correct, Elliot. I was thinking about this myself just the other day. Some of my high value domains have been in my portfolio for almost 30 years – and they may well be in our family for 20 more, since we don’t particularly even want to sell, as they continue to increase in value. That certainly qualifies as generational.
Domain is not only an asset ,it brings me joy and happiness…..it is part of the branding ,it is part of you.
My domain name beats all your domain names!!