Domain Auctions

You can purchase domains via various domain auction sites, these websites make it easier to buy and sell domain names.

A drop registrar is a domain name registrar who registers expiring domain names, to sell at auction, as soon as the registration expires. To participate in a drop registrar auction you need to register your interest prior to the beginning of the auction.

A domain auction site allows a customer to purchase a previously registered domain, which suits their needs, from an owner who wishes to sell their domain name. A domain auction site allows sellers to list multiple domains, easily and conveniently, on the one website.

A domain auction can be solely online or a live auction in which you can participate in-person alongside Internet, phone and proxy bidders. An auction may take place at a domain event, Moniker specialize in event-based auctions. You do not need to pre-register for these particular domain auctions; you can just join the auction and bid.

Domain auction sites allow users to search for numerous domain names that are listed for sale and place bids; the highest bidder becomes the new owner of the domain name. The more common, generic or popular the domain name, the higher the winning bid will be.
Pool.com and SnapNames are examples of domain name auction websites that allow domainers to purchase domain names that are up for sale, expired or dropped. Drop.com.au  specializes in selling only expired domain names.

The fees of domain auction sites usually range from 2-10% of the winning bid. Domain auction sites often provide links to ensure safe transfers of money and domain properties.

Domain auction sites have grown in popularity due to the significant increase in domain name ownership; it is now common practice for an individual or business to own a domain name. Domain Names sell at a considerable amount; for example in 2009 Toys.com sold for $5 million and the website Insure.com sold for $16 million!

Search Engine Optimization (SEO), Domain Name Front Running and Type in Traffic have also contributed to the increase in desire to purchase domain names via auction.
 
Prior to domain auction websites, domainers would sell their unwanted domain names on auction sites such as eBay or domain forums. Some domainers would place a banner on their website informing visitors that their domain was available for sale. Domain auctions allow the domain name to be exposed to a larger number of potential buyers.

For more information on domain selling please see:
Sell or not to Sell
How much is it worth?