Sextoys.com.au sells for $25,500 as domain name trading takes off

Australia’s fledgling domain name trading sector has scored its highest ever sale, with sextoys.com.au sold for $25,500 on exchange site Netfleet.com.au.

The domain name trading market has been in existence for just over a year, since the Australian Domain Name Administrator allowed the buying and selling of domain names. There are two main companies providing an exchange for domain names: Netfleet and Domain Market Place.

David Lye, chief executive of Netfleet, which currently has over 30,000 domain names up for sale on its site, admits the market has been slow to gain momentum

“If you’d asked me a couple of months ago I probably would have been a little bit disappointed. It did seem to be a little bit slow off the mark, but in hindsight this is a totally new industry.”

But in recent months things have been picking up. Late last year, freestuff.com.au went for $18,700, while mortgage.net.au was recently sold for $13,500.

“Mortgages and loans are renowned in the domaining industry as a very lucrative area,” Lye says. “If it had been a dot com.au address it would have gone for 10 times that.

Lye says two things may have been holding the sector back in its early days: a lack of awareness in the wider community and a lack of sales history, which prevented buyers and sellers from benchmarking prices.

As sales numbers have grown, so has interest in the sector. “In the last week we’ve seen a real upswing in offers and number of sales and values,” Lye says. “A few months ago we were getting five sales a month. Now we are getting a few a day.”

Typical sellers include domain name speculators (who register domain names in the hope of selling them down the track for a big price) and entrepreneurs who may have registered a domain name in the hope of starting a business but never got the idea off the ground.

“The typical buyer, particularly [looking] for strong sales, are people looking to start-up or rebrand a business,” Lye says.

Netfleet, which is 50% owned by domain name company Netregistry, does not charge commissions on trades, although it does earn some revenue from sellers looking to promote their domain names.

Lye says the company plans to start charging in the next six to 12 months.

Recent domain name sales:

• sextoys.com.au – $25,500
• freestuff.com.au – $18,700
• reid.com.au – $14,300
• forster.com.au – $11,000
• webdesign.com.au – $10,000