[new_here]

Domain names seem analogous to property. A good .com gives a business the digital prestige comparable to having a store on 5th Avenue, New Bond Street or the Champs-Élysées.

Then there other parts of town (.io, .co, .app and so on) which become gentrified and increase in value as people move into them and start doing fresh things.

I once pondered taking out a business loan to acquire a particular .com domain, thinking of it as a mortgage. The thinking was that once it's been acquired you can run your business from that prime property instantly and pay that asset off each month. Then one day if you ever had to sell it you could probably get the same or more for it, provided you hadn't overpaid initially.

[indymike]

There are a few domains that might work that way, but it seems to be more like this:

buy domain ⇾ build traffic to domain ⇾ domain value increases

The value of the domain is often an artifact of the value of what was hosted on the domain, or an artifact of the value of the brand represented in the domain, but rarely just "awesome name value".