Our first domain that we will be auctioning is “PuebloHomeSales.com” and we are going to examine what the worth of this domain might be to an end user. This is not the same as what do we think it will sell for or anything at all to do with the auction selling price but simply to be able to detail to an end user what the domain name might be worth to them as a business asset.

In this case we are dealing with the city of Pueblo as the geo and “Home Sales” as the generic. Both are factors in this case and probably in the vast majority of cases. Factors might be the population of Pueblo, the average home sale price, the number of sales, the number of real estate agencies and sales people.

We will not make this post into the definitive research of this domain but will make assumptions that we feel are conservative estimates of some various factors. Pueblo has 100,000 people and seems to be reasonably prosperous as USA cities go. Houses can go for anywhere between 60,000 to 500,000 dollars. Commission will be assumed to be 3% so assuming a 200,000 dollar hours means a 6,000 dollar commission.

There are by estimate a dozen or so first-rate realestate generics that pair well with geos. In some rough order -
-realestate
-realty
-homes
-property
-realtor (trademark)
-homesales
-properties
-homesforsale

- try to think of a few others and it becomes apparent that there aren’t that many firstraters - even adding more specific generics like “condos” or “waterfronthomes” doesn’t make it an easy take to get more than a dozen. Essentially there are no more than 12 people or companies that can own a highly brandable non-confusing domain.

An estimate of 1 sale a year that results from domain ownership over the next 10 years is very conservative estimate of $60,000 dollars of worth that our domain has. If the alternative domain was “JimBakerPuebloHomes.com” then we should examine further values of switching to “PuebloHomeSales.com”. Resale value is an obvious one in that if everything stays somewhat the same then 5 years from now the winning bidder might move to Denver and want to sell the domain. If money and effort was put into “jimbakerpueblohomes.com” all that money and effort is lost as “Louise Hope” will not want to take over a domain that bears the name of another.

If the domain that was promoted was “pueblohomesales.com” though, then every bit of effort, time, money, etc that was invested in branding the domain is potentially recoverable in the form of increased monetary value upon sale. The new owner might be looking at a more valuable domain capable of bringing in an extra 2 sales a year ie $120,000 over the coming 10 years. The number of sales might even be greater, much greater when you add the value of being “jim@pueblohomesales.com” - a simple email address.

If an agent doesn’t have a website and they use their realty firms email address for themself and later they move to a different firm they would lose their former contacts and all advertising monies spent would have been spent building what is now a competitors’ site. This could quite easily be translated to loss of sales. Owning a website like “PuebloHomeSales.com” makes it easy to take contacts with you when changing realty firm alliences.

In our instance we imagine that if an improved “pueblohomesales.com” sells after 5 years of branding and adding content it will sell for at least as much money as it was bought for and so the $60,000 that the domain added to the salesperson’s sales is pure additional income without any cost of domain ownership. Again, easily the domain might have increased in value and a profit made on the 5 years of ownership.

Using the figures above we can estimate that the value of the domain “pueblohomesales.com” might be a minimum of $60,000 dollars. This would seem to mean that if that same amount had been the purchase price then even if it wasn’t resold it would have paid for itself in 5 years which isn’t bad and given the upside it might be a bargain at that price. Our rough “good times” estimate would be an average of 4 extra sales a year of 250,000 which is $30,000 a year and therefore $300,000 wouldn’t be an absurd price to pay. This assumes that there is not a shortage of money and that the money still exists to promote the domain.

The figures are even higher for a realestate firm with many sales people. Advertising budgets are higher and advantage can be taken of the memorabilty of the geo-generic name of the domain. “PuebloHomeSales.com” could be used as a website for a firm or an agent and either can build a valuable asset of the domain whereas a unique name like “FootholdRealty.com” (assuming it isn’t in the city of “Foothold”) that has no enduring brandability will be a worthless asset should the company close its doors.

Our final valuation is $500,000 - we think that a company or ambitious real estate agent could easily get that much in additional sales over 10 years.We don’t expect to get that amount, but if the bidding were spirited and someone paid that much we wouldn’t be thinking they were foolish. If they just bid that much without having to maybe but we consider it completely economically sound to invest that much if that much is what it took to win.