If you’ve been astute enough (or lucky!) to acquire a good geodomain at a reasonable price, then you can either sell it on to an enduser – or develop it yourself.
The first option will generally give you a decent return on your investment in a reasonably short space of time – and I’m talking much better than any bricks and mortar investment. I’ve been involved in the buying and selling of many prime geodomains – lots for 4 figures; quite a few for 5 figures – and one for 6 figures.
The second option has the potential to be an ongoing cash cow. I’ll deal with this in a subsequent article.
What is a geographic domain?
Firstly, for those that don’t know, a “geodomain” is a domain that describes a geographic location. For the purposes of this article, I’m referring to domains that end in .com.au.
They can be at country level (e.g. Australia); state level (e.g. Queensland); regional level (e.g. Sunshine Coast); city / town level (e.g. Canberra); suburb level (e.g. Kings Cross).
International destinations are also popular even in .com.au – domains like NewYork.com.au; Beijing.com.au; Malaysia.com.au. The travel industry is huge and these domains can provide an ideal platform for promoting overseas holidays.
Bricks & Mortar versus Digital Property
A geodomain investment is similar in many ways to a commercial property investment (except without the lengthy time involvement, cost and all the regulatory hassles). 🙂
Let’s say for example that you purchase an old building in the main street of town. One option would be to hold onto it until somebody makes you an offer you can’t refuse (and perhaps earn some rental in the interim).
Alternatively, there is probably greater potential to be gained from knocking it down and building a prime retail centre which you then fill with tenants. You either keep the property for its income – or once fully tenanted, you sell it off to an investor based on a percentage yield.
And to get to this point you’ve had to engage heaps of people. Planners, valuers, architects, project managers, builders, marketing people, advertising agencies; real estate agents and so on. I’ve probably missed at least half a dozen!
With a geodomain, investment / development principles are similar – but the process is SO MUCH EASIER.
Benefits of a geodomain (compared to real estate):
- Low acquisition cost
- Minimal ongoing costs – you don’t need to have plumbing fixed or windows replaced for a domain! The annual registration fee is also a lot less than council rates.
- Huge potential return on investment – e.g. buy for $17,000 – sell for $60,000 (within 6 months). Or buy for $1500 and sell for $8500 (within 12 months). These are real examples.
- Minimal hassle and red tape. Control the process yourself.
- Huge flexibility
In Part 2 of this article (coming soon) …..
- How to develop an ongoing cash cow out of a geodomain.
- What are the best revenue sources?
- Prime examples of successful geodomains (Australian and international).
(The content contained in this article is solely the opinion and honestly held belief of the author Ned O’Meara).