Just like other property (and yes, domain names are property), domain names can be auctioned off from one party to another. There are essentially two kinds of auctions. There are auctions for expired domain names and there are auctions for currently owned domain names. The latter gets a little more complicated so this recommendation will focus on the former.
When a domain name expires (something you should never let happen with your own domain names), it enters an “unofficial” grace period. The registrar for that domain name grants the owner some time to renew the name. This period can last up to 45 days. This is registrar dependent. The domain names current website is up and running during this time.
If the owner still does not renew during this grace period the website is eventually taken offline and the domain name enters into an official Redemption Grace Period. This period last for 30 days. After these 30 days, the domain name enters a 5 day deletion hold.
After these 5 days are over, the domain is officially deleted from the Shared Registry System and it is available to the public to be registered. It is at this point that a service such as Snapnames comes in. This graphic of the domain deletion process is quite helpful.
Snapnames partners with various domain registrars to auction off deleted domain names. Once a domain name is available, Snapnames holds a three day auction. The auction works like any other kind of auction; the domain is won by the highest bidder.
Is there a way to preview expiring domain names? There are two ways to see forthcoming expired names. Snapnames provides downloadable lists of soon-to-be-expired, soon-to-be-deleted and current auction domain names. Alternatively, DomainTools provides an online listing of all domains set to expire. This list is searchable and sortable. Remember, expired domains are not yet available. You have to wait the 5 day deletion hold period.
Snapnames offer two kinds of auctions private and public. Private sounds exclusive, but anyone can participate. Private auctions are only open to those who have pre-bid. The minimum pre-bid amount is $60. If more than one person pre-bids on a domain name, then it enters a private three day auction among those who pre-bid. Domain names that did not have any pre-bidders enter a public auction. Typically, quality domain names rarely make it to the public auction. Most are identified during the expiration process and pre-bid are placed.
It takes some expertise to begin to recognize quality domain names. I suggest the beginner first begin to learn about the world of domain by reading articles such as this one and by reading sites like Domain Name Wire.
Don’t forget to check out my Domain Name Handbook, a simple look at choosing, registering and managing domain names. It is available as a free non-printable download.
