Appraising homes is easy compared to valuing domain names.
Texas doesn’t have an income tax. But the state needs revenue from somewhere, and in Texas that “somewhere” is mostly property taxes. Every year I have to pay about 2.4% of my home’s value in property taxes.
This steep rate creates a bit of a dance each year. The counties appraise homes by an automated system, kind of like Estibot. Then you have to argue with the county that the computer-generated appraisal is wrong.
That’s how I spent my morning. Arguing that something I own is worth less than an appraisal.
It strikes me as a sharp contrast to what we’re wired to do. We spend our days arguing with people that our domain names are worth more than other people think the are.
The truth is, the county’s version of Estibot isn’t that bad. Unlike with domain names, comps are reasonably easy to pull. Even though many of the homes on my street are 20 or 30 years older than mine, there’s a model for taking this into consideration.
I’m looking at my appraisal right now along with a sale of home across the street. The county knows how much that home sold for last year. Then it adjusts.
First it adjusts for the quality of the build. Then the condition, age, home features and size. That comes up with a number.
Try comparing just two houses like this and you might get a wacky number. So they compare it to about five homes in the neighborhood.
A perfect number? No. But it’s directionally correct.
I can’t say the same thing about domain name valuation. (I’m not just talking about Estibot here. Estibot does a fine job of highlighting the factors to consider in domain valuation).
The issue with domain valuation is two-fold: an almost complete lack of comps and the unique nature of every single domain name. There are no square feet to compare. No depreciation to adjust for. Each domain name is completely unique.
Indeed, we work in an extremely inefficient market. That creates great challenges and opportunities.
David Gruttadaurio says
Here’s a great Estibot example:
Bitcoins.com goes up for auction Thursday with a reserve of $750,000.
Estobot valuation: $270
Larry says
The state I live in not only are the property taxes are higher than 2.4% and we also have one of the highest income taxes in the country. And sales tax for that matter.
Patrick Cowan says
Last year did got an Estibot appraisal for 3dprinter.com(don’t own it) $25.00 should have contacted the owner and offered him triple the appraisal.
accent says
Estibot uses comps from the past few years. Judging it on Bitcoin names, or 3-D names is ignorant.