Why Buying a Cheap Domain Name Can Lead to Serious Additional Costs

You may come here because you are considering buying a domain at a low price but have some doubts. Many registrars offer tempting promotions and discounts, selling domains for $1 or even giving them away for free for the first 12 months of use.

However, what is behind such an attractive domain name price? The answer is simple: there are hidden costs that will show up later and perhaps at the wrong time.

In 2025, an online presence is critical for many businesses, and a cheap domain can cost you time, money and reputation. We have written this article to reveal all the pitfalls that await you when buying cheap domain names in 2025.

Why Are Some Domains This Cheap?

Although there are domains worth millions of dollars, you often come across very cheap options. However, the attractive price is not an accident, but the result of business and marketing strategies implemented by registrars and TLD providers.

Here are the main reasons why domain names can be so affordable:

·  TLD managers subsidise domains. For example, new variants such as ‘.xyz’ or ‘.club’ can be available for as little as $0.10-0.50 for the first year of use. By offering domains for almost free, they build up the popularity of new domain zones in the expectation of covering costs in future periods.

·  Some companies purchase domains en masse at a discounted price. As they save themselves money, they also offer domains at a lower price to end users.

·  Some registrars use a very different business model where making money from traffic and reselling inactive domains is a priority.

·  Some domains are cheaper only during the limited period of ownership. However, the catch here is that after 1-3 months, you will have to pay the full rate.

In addition, some TLDs are frankly in too low demand, which affects their price. Although registrars reduce the price of unpopular variants to stimulate sales, they are still chosen quite rarely due to their low recognition.

How the Price of Cheap Domains is Formed

According to Hostinger, the average cost of a domain name in 2025 is around $10-20. However, many registrars use a rather devious strategy of offering the first year for a cheap price of around $1 with an option to renew with a price increase of 5-10 times.

If you want to get a still cheap domain – but without unpleasant surprises in the future – then you can consider Spaceship domains. Unlike other registrars, Namecheap doesn’t put a huge price tag on renewals, so you can avoid overspending.

Renewal Costs as a Pitfall

The price of any domain is usually based on the TLD (e.g., ‘.com’ or ‘.net’), registrar features and additional services offered. However, the worst thing you may encounter is the cunning policy of registrars significantly increasing the renewal price.

As it turns out, the vast majority of users simply do not check the cost of domain renewal after purchase. In addition, some dishonest registrars offer an automatic renewal function with additional – often absolutely unnecessary for you – services to increase the price.

Limitations on Performance and Support

The desire to save money on infrastructure is the main sin of registrars offering domains at strangely low prices. High DNS response time can significantly affect your web project, as many Internet users today leave websites with pages that take more than 2.5-4 seconds to load.

Poor technical support with experts who are difficult to reach is another problem associated with cheap registrars. For example, some companies offer users to solve their problems only through the forum without giving the possibility to contact the support team even through live chat.

Security Risks with Cheap Domains

If you want to get a domain for free or for a bargain price, you will have to settle for one without DNSSEC support, which increases the risk of spoofing many times more than secure domains. For example, in recent years, many websites have experienced traffic redirection due to weak DNS security, causing financial and reputational losses.

For example, WHOIS protection, which is part of the basic package of reputable registrars, may not be available from companies offering low-cost domain names. If the domain owner’s data is not protected, the likelihood of spam and phishing (e.g., unwanted calls) increases significantly.

Vulnerability to Domain Hijacking

Want a domain at a low price? Face potentially huge costs in the future, as such domains are extremely often targeted by hijackers.

For example, as a result of a long-running attack called Sitting Ducks, around 800,000 domains were compromised, with 70,000 falling into the hands of scammers in the aftermath. Overly weak passwords, ignoring two-factor authentication and the use of social engineering techniques by attackers are key reasons why such incidents occur.

The average cost of legally recovering a stolen domain today ranges from $500 to $2,000 and even higher, including court costs and attorney’s fees. However, if the stolen domain belongs to a business, the downtime losses can be enormous.

While it is now possible to buy a stolen domain back, this is also a very expensive service. Requiring expert negotiation through brokers or auctions, the process of buying a taken domain will go smoothly if you understand the importance of checking its history before the transaction.

How to Avoid Hidden Costs

If cheap domains still seem attractive to you, choosing the right registrar and having a good management strategy will help minimise the additional costs. Follow the tips below to avoid financial pitfalls when buying a domain in 2025:

·  Check the full cost of ownership, not just the price of usage in the first few months or year. By analysing rates 2-3 years in advance, you will be able to assess the real cost of what you are considering buying.

·  Examine the additional services offered (or even imposed) by the registrar. For example, the lack of WHOIS protection and transfer blocking can be a bad sign. In addition, some dishonest registrars add extra services to packages that you often don’t need.

·  Check DNS performance to avoid future traffic loss. For example, DNSPerf publishes visual information about the average DNS response of popular ISPs.

·  Check the registrar’s security measures. Make sure that important things like multi-factor authentication and free domain transfer blocking are available to you.

·  Register the domain several years in advance to lock in the price and thus eliminate the risk of a rate hike soon.

Finally, check out user reviews on reputable sites like Trustpilot and Reddit to see if what the registrar promises you in their adverts matches what people say. Spending just 10-15 minutes reading reviews can save you hours and huge sums of money on potential disputes.