Offer On One of my Domains to Lease - Advice Please

[BLazeD]

I own an all premium letter .net and someone emailed me asking if it was for sale. I said make an offer if interested and they came back with:

My preference would be to lease the domain from you for a couple years with the right to buy it at a pre-determined price at the end of the 2-year period.

Sample:
24 month agreement:
Monthly lease installment - $150
At end of 24 months, sale price: $10,000

Obviously I would retain control of the domain through the lease period and protect myself etc... Just wondering what you think of the prices quoted? When he says "Sample" do you think he is making an offer on those terms? I would be pretty happy with $150 per month over 24 months. Just unsure what to do or how to counter as never encountered a lease arrangement before, and not sure if the terms he has listed are a starting point for negotiations or just a genuine "example".

Cheers!

 

[Johnn]

You need to find out if the reason that that want to lease because of the current financial situation. This does not look like a 'typical end user' but rather a 'business proposal'. From the tone of the reply, I don't think they have any problem of buying the name outright.
You may want to reply back that you are not in the business of leasing and would entertain discount offer so they have 100% ownership of the name.
Explain to them the dangerous of leasing: if the business is taking off you may have the rights not to sell the name and they will have to start all over again to build the business based on the domain name.

Just my 2 cents.

 

[BLazeD]

Thanks, your comments are helpful as always. Here is the full text of the email response. As I said, he originally asked if it was simply for sale, so I think he can buy it outright too...

Matt,

Thank you for the note. There is a wide range of prices associated with domain sales. It would help me a little if you had some price range that would be comfortable for you.

My preference would be to lease the domain from you for a couple years with the right to buy it at a pre-determined price at the end of the 2-year period.

Sample:
24 month agreement:
Monthly lease installment - $150
At end of 24 months, sale price: $10,000

Please let me know if that framework would be of interest to you.

Best,
[name]
[phone number]

 

[Johnn]

I sold LLL dot net in the range of $5K to $10K before but you need to find out who are they and what is the budget (they must have some range in mind).
Can't make any suggestion without knowing who they are. I think you already know what I am talking about.

 

[Biggie]

I own an all premium letter .net and someone emailed me asking if it was for sale. I said make an offer if interested and they came back with:



Obviously I would retain control of the domain through the lease period and protect myself etc... Just wondering what you think of the prices quoted? When he says "Sample" do you think he is making an offer on those terms? I would be pretty happy with $150 per month over 24 months. Just unsure what to do or how to counter as never encountered a lease arrangement before, and not sure if the terms he has listed are a starting point for negotiations or just a genuine "example".

Cheers!

seems pretty simple to me


if you're not current;ly making $100 a month on this domain and you haven't developed it yet, then the lease option is a good option


in 24 months, the value of LLL nets will be higher than they are today, you will have made a few G's and will still retain the right to sell at the end of lease or any part therein, should that be included as a clause in your agreement.


make sure that the content used on your domain will not deminish future value or content that will restrict it's future use, such as adult, malware, even gambling in some instances.


Good Luck!


imo...

 

[Melly]

The lease option is good as long as it works for both sides. John & Don both make good points. Before deciding if you want to lease or not you would want to make sure you are happy with the amount they are offering, if you want to just lease it to them with right to purchase or just lease, and definitely find out what they would be putting on the domain. If you are going to choose to lease the name but sell to the highest offer at a later date you don't want potential buyers to find your domain listed as spam or something worse which would scare buyers off.

Also if you are not familiar with the leasing process simply tell them you aren't interested and give a price that they can purchase it out right. If you think they are going to push for a better price maybe state higher than you would be happy with to give you some negotiation room.

Good luck

 

[katherine]

A lease will probably require a contract to cover both parties.
Why not make a deal for a sale with installments ? I believe Moniker escrow supports installments.

 

[Johnn]

Installments only works if they can't afford the name.
Business people would take a loan and pay for the name so interest can be charged against expenses.
I think they just want to play with the name to see if it works out for the business. Assuming they can afford the name but just don't want to purchase it.

 

[Biggie]

A lease will probably require a contract to cover both parties.
Why not make a deal for a sale with installments ? I believe Moniker escrow supports installments.

Hi

i've leased domains in the past and the email correspondence served as the agreement/contract.


"by sending initial payment/deposit for the lease of said domain name "thename.com" you hereby agree to all terms and conditions stated herein".

very simple

imo...

 

[BLazeD]

Just replied:

Hi xxx,

I am sure you have some sort of budget set aside for the domain, or a purchase price range in mind. If you let me know, we can go from there. Note if you were to purchase the domain outright, I could offer you some sort of discount to what would be the final sales price in a lease arrangement.

In terms of leasing the domain, may I ask your intended use for the domain? Do you have a sample lease agreement available? Is there any particular reason you would prefer a lease over an outright purchase?

I am sure we can come to some sort of an arrangement we are both happy with.

Regards,

Matt

 

[jdk]

Keep in mind, value in 2 years will be higher than they are today.

 

[BLazeD]

Hey guys

He came back to me as follows...

...

I am truly struggling with this number.

It is very difficult to find anything beyond the Top 100 sales prices. So, my numbers I am reviewing are likely slanted upward.

The benefit is that this is a short 3-letter domain. The downside is that it is a “.net” domain and “.com” domains generally have a higher value.

How does $4,100 sound to you? It feels a little high on my end, but I want to present an offer to you that lets you know I’m genuinely interested.

Seems like he could definitely afford me, but I don't want to push too hard.

Cheers

 

[copper]

I guess it all depend on your domain.
Is it LL.net or LLL.net?
Is it pronounceable? Has meaning?

However, by saying $4,100 instead of $4,000 or $4,500, I think he want
you to know he is expecting to pay not too much more.

Ultimately, would you be happy with $4,100 or just little more?
Perhaps you can push up to $6K?

 

[BLazeD]

Hi, lll.net with all premium letters, several meanings and 53 million Google results.

I would like to sell it... $4k is marginal, I was thinking of trying to push him to around $6k too.

Thanks

 

[Johnn]

6K counter offer would be reasonable. Let him make a counter offer back one more time so when you sell to him he does not have 'cold feet'.

I just sold one LLL dot net for $5k - starting negotiation at $2K.

Good luck!

 

[BLazeD]

Hey guys, went back at 6 and he said ge needed to discuss with his partners. Will let you know. Cheers

 

[WeBuyThe.Com]

Strike while the iron is hot, you may not find another buyer for 2 years.
One thing we've learned in this business is not to be greedy. Assuming you bought
the name years ago for xxx mid x,xxx is a nice return. You can do a lot with that $$ today.

Good Luck

 

[razorblade]

Keep in mind, value in 2 years will be higher than they are today.

Why are you suggesting that in 2 years the value will be higher? I think the value will be far lower than it is today, even with this miserable recession.

1. In two years time the recession could be even worse than it is today. Many economists are predicting either a double dip recession or the current recession stays so long that by the time its over, a new recession will have hit us.
2. A lot of domainers are selling their .net portfolios in a major way. .Net as an alternative to .com gets diluted each year as cctlds grow in favor of .net. The vanity extensions that are coming will even further dilute the extension.

I say sell now. Get what you can. Very bearish on .net. My apologies

 

[BLazeD]

Update on this, we agreed to a price of $6K over 4 months, then when he was due to make the first payment he cancelled the deal. Same thing happened to me over another $3K domain 4 weeks ago.

Man I have been having bad luck lately...

 

[Onward]

Something very similar happened to me with a mid xxxx sale recently...it burns a little, but it seems to happen quite a bit.