A consideration of the following...
- Can I list multiple categories of users who would legitimately want this name?
- For some users in those categories is there a legitimate advantage to having this particular domain name?
- Have similar names sold before, or if not, can I explain why they have not (e.g. very new area)?
- When I do a Google search is the name meaningful in terms of web popularity?
- Is the price low enough, and the renewal fee standard, so that I can justify that a reasonable probability of sale times reasonable net expected profit exceeds my annual cost?
- If I had the time, would I personally use the name for development?
- Are the aesthetics of the name sound? Memorable, positive, a little unique but not too unique, differentiated from others for sale.
- Is the niche not already over speculated? i.e. look at competition
- Would I feel proud to see it in my portfolio? (i.e. it is just me but I never consider many names, even in niches that are popular, for this reason)
- Does the niche fit my personal branding strategy? That is does it match what I have defined as being interested in.
- Are the automated appraisals at least reasonable?
- Does the name excite me?
- Do I have particular expertise in the niche represented by the name?
- Does the acquisition fit my personal risk tolerance?
- Will availability of similar names for hand registration kill potential price on reselling?
- Is it likely that in a year's time there will be more rather than less interest in the domain name? i.e. trend positive
- Have I slept on the idea and still feel as positive as yesterday?
Some of these, like 9, 12, are completely subjective. Re 10, I realize many active on NPs are in this full or significantly part-time as a business, and are much earlier in life, but for me I don't ever want to be in the position that if I never sell another domain name I take a big loss on domain investing.
Like any set of rules, they are guidelines, not absolutes. Seldom do all of the boxes get ticked, but I still go ahead, particularly if the cost is low. For example I recently registered a name that had both GoValue and Estibot <$100, and was not a niche I have particular expertise in, but it was a domain phrase I really liked and thought the word worked perfectly with the (new) extension. The .com sold not too long ago for $29k, but the major part of my decision was I really liked how natural the phrase was. I had considered it multiple times over weeks, and still personally really liked it. So I decided to try it.
Thanks for the question!
Bob