I did this last month, snagged a great domain that no one else found and got it for $69 because I waited until the last moment to place my pre-bid. Flipped it within a week for a little over $1,000. And probably could have gotten more if I sat back and waited 6-12 months, but a bird in the hand… (plus I like to keep turning over inventory and maintaining cash flow).
  Since starting SEO back in 2009, it has become very difficult to rank brand new domains. Unless you are building a brand, it's highly recommended that you start every new money site with an expired domain. Additionally, if you're building a PBN, you should only consider using expired domains. The problem is good domains start at $50 a piece, and anyone charging less is either full of sh*t or selling garbage domains, and I mean that. If it sounds too good to be true, it probably is. DomCop has a great offer that all of you buying expired domains should consider. For the price of a couple domain names, you can use DomCop for a month, snag some excellent domain names, which would otherwise cost you thousands of dollars. If you're considering expired domain software and don't have the knowledge to program your own crawler, I'd lean towards DomCop.   
Once you have a name in mind, how do you know if the price is fair? I like to use namebio.com to compare the domain I’m thinking about buying with similar domains that have sold. You can enter the keyword and also use some advanced search features to see a list of names similar to yours, what they actually sold for, and when they sold. You can also research current domain sales on venues like GoDaddy Auctions and Afternic. Finally, Ron Jackson issues a weekly report on DN Journal that covers the top public sales of the week. You can use all these resources to help you price your domains correctly.
When speaking about an expired domain’s backlink profile, this refers to the incoming links that have built up from when the domain was previously in use. Recently-expired domains that have long histories aren’t unheard of. While the pre-existing content of the domain rarely remains visible when the domain is re-registered, links on the other hand do remain, as long as the new owner doesn’t devalue or delete them.

Park the domain with a domain parking service. Since you may not have content to put on the site, a parking service puts up a dummy page with ads. When people visit and click on the ads, that's money for you. This method works best with popular keyword domains that get lots of traffic. In most cases, you will not have control over what ads appear on your domains.[5]
METHOD 1: Find a domain name with huge potential and sell it as is – This option is tricky since many good domain names have already been bought, so your chance of being the next Mike Mann is highly unlikely. Understand that unless you have a single, generic word as domain name like these world’s highest-selling domains, it could take months or years to for your domains to sell.

If you’re patient enough, you can discover at least four to five very good .COM domain names at attractive prices. However, you’ll need to carry out some research and find out the right places where they may be available. I’ve seen that such .COM deals can also be bagged from popular domain marketplaces like Flippa.com, or from the private portfolio portals of sellers, provided you employ the right strategies. You can contact the domain owners directly too. There’s no harm in emailing them directly to negotiate the prices.

Yes, we port in all of the domains from NameJet, SnapNames, etc. There are a lot of great deals to be found. Some are absolute trash of course but if you can sift through them and put some time in (hopefully that is what we are trying to do with our tools is save time and give some value add with the SEO metrics, alerts, etc.) then you can find some great bargains.
Domain name sellers are advised to use Sedo.com to list their domain name. The real advantage with Sedo.com is the mandatory escrow service that comes with every transaction. The site charges the seller a commission of 15% per transaction or USD 50, whichever is higher, for domain names featured on the site. Sellers who do not list with Sedo.com but would like to use their escrow service will have to pay the minimum transaction fee of USD 50, or 3% of the transaction, whichever is higher.
In the past, expired domains were used as part of black hat SEO in order to generate backlink sources quickly and easily, and this practice is still used somewhat today. Getting links in this way is not a recommendable practice. All relevant search engines work nowadays with highly complex ranking algorithms, which can no longer be outsmarted by these link networks.
In the grey hat SEO world, the thought is that you can take a domain that is keyword driven, do a quick optimization to get the site ranking, and sell it off at a profit. It could, and does happen daily. How much time is invested in optimizing a site to get to page one, vs how much the site will sell for? (remember that quote at the beginning of this article?). Let's put it into simple math:
Hey, the possibilities are endless when it comes to domain flipping so do not think that all profitable domain names are already taken. At this time, almost 90 million .COM domains have been registered, so people tend to think that there are not many good domains left. That is not true since you still have the opportunity to incorporate two or three word target keywords.
With over 25 million .com domains registered with Google alone, this top-level domain is by far the most popular choice worldwide. According to the domain marketplace Sedo, the average sales price for a .com domain name during the second quarter of 2015 was 4,701 dollars. The most expensive publicly traded domain names have been known to fetch eight-figures. But don’t quit your day job just yet: such sales are the exception rather than the rule.
There are many places and ways you can purchase domain names.  You can purchase unregistered ones through sites like GoDaddy.  There are forums where people will gladly try to sell you their domain name (usually though the domains being sold in forums are either crap or the asking price is so high it does not allow you any room to flip the domain).  And then there is my favorite way of obtaining domain names, through an online auction at Namejet.  Let’s first talk about Namejet and then we’ll talk about how I personally ring the register by flipping domains.
Another point of concern is that many people feel that squatting or registering domains is unethical. This is because many web developers have a hard time finding relevant domain names for their projects since most of them have already been registered. Many corporate giants also frown upon the domain flipping industry because many domain names relevant to them are already registered.
Choose Niches that make money: People will buy a website domain if they think they can use it to make money. So buying popular phrases/words that could be associated with selling something like computers(.com) or hotels(.com) could be used by a company to sell computers or hotel reservations. However, something like Warof1812(.com) may not have the same business potential.

So, what I like to do is also choose DMAS listed entry. No fake or no unsure page rank. Click the apply filter button and this will show us a much better group of websites, including a lot of high page rank websites. That’s one great thing about Go Daddy Auctions that you don’t have to guess about what the rank will be which is not the case with a lot of deleted domains which, because they were deindexed they didn’t have any content, they didn’t have any hosting, they don’t have any page rank. So, you have to make an estimation.
No, no, no. ToysRUs made a perfectly logical decison that most any business would do and Google tanked them for it. ToysRUs wanted the url toys.com to direct to their site.  They're all about toys and they simply bought a url that described their business and told the url where to take people.  Google tanked them in the rankings because Toys.com came with link juice. Google assumed that Toys.com was doing this to manipulate the search engines but there is just, to my knowledge, ZERO evidence of this.  This is another case of Google caring more about the possible spam threat than the actual rankings for searchers.
That said, my recommended budget for beginners would be $500+. Using this budget you could buy a bunch of high-potential $10 domain names, expired/dropped domain names or a mix of both. It’s very important to invest only what you can afford to lose and treat this as a side hustle till you get the momentum going. As you gain experience, industry expertise and some sales under your belt, you can then consider slowly growing your business into a full-time gig.