In case you are wondering should you buy a hosting and develop a website for a domain name you just bought, and with an aim to sell it at a later point, there is no short answer.
The choice largely depends on your prospecting profit margin. It is not absolutely necessary to get hosting which will serve a website for your domain, but this choice will certainly have an impact on the offers you get for the said domain name.
After registering new domains, you will list them with online marketplace websites such as Sedo, Flippa, and Afternick, though such “fresh” domains must be listed with a relatively low asking price ranging from $50 to 500 for a really good domain.
I would say that it is important to have a website developed for a strong domain name you aim to sell with an above-average profit margin, as it will improve online visibility for your domain name.
Still, I want to discuss different options you can opt for, and how they influence the domain name value.
The easy choice – get a parking page for your domain name
The easy choice would be to have your domain name with a domain registrar that provides parking page service and produce a simple one-page website that notifies the visitor that the domain name is for sale
I would note that some domain registrars offer free parking pages for domains you hold with them, so if you hold a number of domains it can save you a significant amount of money.
A parking page is a suboptimal solution as it does not drive visitors traffic, hence it has a relatively low positive impact on your domain value.
We can conclude that this option’s main goal is better online visibility for your domain name, while the impact it has on the domain value is almost negligible.
Get a hosting and develop a website for your domain name
Being an “insider” with a specific business or industry will help you make out great domains for that business niche. A savvy domain trader will be looking to develop a website for such strong domains.
The website should cater to a specific visitor audience so that it increases its domain value with them, though it does not have to be an elaborate hosting plan as a relatively cheap $5 per month blog hosting will suffice.
A functional blog website will provide traffic and improve your domain authority, making the domain name much more attractive to potential buyers.
The overall success of the website will have a positive impact on the domain value, effectively increasing its price from an average $500 up to a five-figure number.
In most scenarios this scales directly with content quality, meaning the more you invest into a quality website, the more you can expect to profit in the long run from the domain (and website) sale.
The conclusion is that you get much more than you invested
Considering your overall investment was average $10 for the domain plus under $5 per month for hosting (over a period of time) the total monetary investment would amount to only a fraction of the potential profit.
It is not unrealistic to expect that a domain with a developed website can be sold for a few thousand dollars as long as the domain is good and has a developed website underneath based on your know-how of a specific industry.
We can conclude that yes, it is important, as I am sure by getting a hosting for your domain and investing in websites you will vastly increase the odds of selling a domain.