appraisal: definition

A domain appraisal is an estimate of what a domain name might sell for, made by a person, such as a broker, or by an automated tool. It is an opinion, not a price anyone has agreed to pay. Nothing in this explainer is financial, legal or accounting advice.

What a domain appraisal is

There is no official standard for valuing a domain name. An appraisal is one view of what a buyer might pay, based on the name itself and on past sales of similar names. Two appraisers, or two tools, can reach very different figures for the same name.

Accounting rules do not use appraisals. Under IAS 38 (International Accounting Standard 38) on intangible assets, as adopted in the European Union by Regulation (EU) 2023/1803, an intangible asset is first recorded at cost and can be revalued only by reference to an active market. These standards are required for the consolidated accounts of listed companies; member states may extend them to others. Spain’s general rules for intangible assets, set in 2013 by the Instituto de Contabilidad y Auditoría de Cuentas (ICAC), also value them at cost, and later at cost less amortisation and impairment; that text does not mention domain names. So the figure in the accounts is normally what was paid, not an appraisal. How a business should treat its own names is a question for its accountant.

IAS 38 also explains why unique assets are hard to price: an active market rarely exists, contracts are negotiated privately, transactions are infrequent and prices are often not public. It is written about brands and trademarks, not domains, but the same reasoning describes the domain aftermarket The market where domain names that are already registered are bought and sold. Full definition of aftermarket.

What makes a domain valuable

Value factors are market opinion, not rules. Buyers, sellers and brokers commonly weigh length and ending, meaning, brand potential, the scarcity of the name’s shape, age, and whether a particular end user A buyer who wants a domain to use it, not to resell it. Full definition of end user needs the name.

Legal risk lowers value, and here the rules are clearer. Under the UDRP Uniform Domain-Name Dispute-Resolution Policy ICANN's out-of-court process for trademark disputes over domain names. Full definition of UDRP, as of October 2026, a name that matches or contains someone else’s trademark can be lost, and the only remedies are transfer or cancellation. According to the panel The one or three independent experts who decide a domain dispute. Full definition of panel views summarised by the World Intellectual Property Organization (WIPO World Intellectual Property Organization The United Nations agency whose center handles many domain name disputes. Full definition of WIPO), adding a descriptive or geographic word to a recognisable mark does not avoid confusing similarity.

Buying names to resell them is not bad faith Intent to take unfair advantage of another's trademark through a domain name. Full definition of bad faith in itself, and offering a name for sale, including on a marketplace, is not bad faith where the holder has its own legitimate interest A GDPR ground for processing personal data, weighed against the registrant's privacy rights. Full definition of legitimate interest. Registering a name primarily to sell it to a trademark owner, or to a competitor, for more than documented out-of-pocket costs is listed in the UDRP as evidence of bad faith.

Comparable sales and where to find them

The usual method is to look at comparable sales Past sales of similar domains used to judge what a name is worth. Full definition of comparable sales: past sales of names with similar length, words and ending. NameBio A searchable database of publicly reported domain sales. Full definition of NameBio is a searchable database of publicly reported domain sales used for this. It covers only sales that were reported.

Only some sales are made public, so any set of comparable sales is incomplete. And each name is unique: in the words of IAS 38, “the price paid for one asset may not provide sufficient evidence of the fair value of another”. A comparable sale is evidence to weigh, not a price list.

Automated appraisals and their limits

Automated tools compare a name with past sales and return a figure. Different tools often give very different figures for the same name. Their limits:

they can only learn from reported sales
they cannot see who needs a particular name
they cannot weigh trademark risk the way a UDRP panel does, on the facts of each case

Their output is not a legal or accounting valuation. UDRP panels do not value names either and cannot award money. A complaint filed after a failed attempt to buy the name, with no plausible legal basis, can be found to be reverse domain name hijacking.

Types of valuable names: one-word, brandable, exact-match, geo

Market practice groups names into types. None of them guarantees value.

one-word .com A .com domain made of one dictionary word, among the most valuable name types. Full definition of one-word .com: a .com made of one dictionary word. Holding dictionary words for resale can be legitimate under the UDRP, but the word does not protect a name used to target a trademark.
brandable domain A domain valued because it could serve as a brand, often an invented word. Full definition of brandable domain: an invented word, a blend or a short, easy to say name that could serve as a brand. Its value depends on taste, so prices vary widely.
Exact-match domain (EMD Exact Match Domain A domain that exactly matches a common search phrase. Full definition of EMD): exactly a phrase people search for, such as a product plus a city.
geo domain A domain whose name is a place, such as a city or a country. Full definition of geo domain: a place name at the second level, unlike a geoTLD A generic top-level domain named after a city or region. Full definition of geoTLD. A place name used only in its geographic sense is not a trademark for UDRP purposes unless registered as one.
domain patterns Codes such as LLL, NNN or CVCV that describe the letters and numbers in a domain. Full definition of domain patterns: codes for a name’s shape, where L is a letter, N a digit, C a consonant and V a vowel. Short patterns are scarce.
aged domain A domain first registered many years ago and never allowed to lapse. Full definition of aged domain: a name kept registered without a break for many years. The registration Obtaining the right to use a domain name for a set period. Full definition of registration event in RDAP Registration Data Access Protocol The modern protocol for looking up domain registration data, replacing WHOIS. Full definition of RDAP data shows when it was first registered. Age alone does not make a name valuable.

Example: comparing two names

Take two hypothetical names: lantern.example, a single dictionary word, and bestcheaplanternshopnow.example, a long phrase.

Length and meaning: the first is short and a real word; the second is long and hard to remember.
Trademark risk: a dictionary word used for its ordinary meaning is safer than a name built around someone’s brand.
Age: RDAP shows when each was first registered.
Comparable sales: the reader would have to look up reported sales of similar names.

Most buyers would probably see the first as the stronger name. That is a judgement, not a figure. Any figure would depend on reported sales that may be scarce, two tools may disagree, and only a buyer and a seller who agree set a price.

appraisal