How Do You Make a Profit in Domain Flipping

At this point you probably know the basics of domain flipping, buy low sell high.  That sounds pretty straight forward, but there are more steps in the process then just buying and selling.  So, how do you make a profit in domain flipping?  Here are some important things you need to know in order to succeed in this business.
How Much Should I Spend and How Many Domains Should I Purchase?
By now, I'm sure you are aware that you will have to spend money in order to make money.  That said, you will need to decide just how much money you are going to spend.  The most popular option is to buy domains for $10 and turn around and sell them for $20.  Although this might seem like a small profit, but many people are selling hundreds of these domains over the course of a month.  This is a low risk option but can be very time consuming because you have to sell each domain individually.
There are people who prefer to purchase more expensive domains for $1,000 and selling them for $2,000.  The downside to this option is the risk factor.  You have a lot to lose if you make a bad investment and get stuck with a domain that might sell for a lot less than $2,000.  The upside is that it's less time consuming, you are putting in a lot less effort and you have the potential for a higher payout.
Unless you are pretty seasoned at domain flipping, I would suggest you start off lower until you feel you are pretty savvy at picking domains wisely.  It's up to you.
Make a List and Stick With It
You should start off with a list of things that are important in purchasing "good" domains.  If you find a domain that doesn't cover the important, valuable points of a domain, don't buy it.  Ask yourself:
Is the actual url of the domain too long or is it short and to the point?Does the domain name consist of real words, including popular keywords?Does the name have a niche that is sought after by others or work well for a particular type of business?
How About the Domain's Extension?
The most popular extensions are .com or .net, but these domains can also be little more expensive to purchase because of their popularity.  Other extensions such as extensions for other countries are fine as long as you find someone from that country to buy the domain.  As an example, the extension for a domain in Great Britain is .uk.  If you're not sure where the extension is located, just google it and you'll find out.
There are other extension that come into the mix, due to businesses not being able to get the name they want to use. A few less popular extensions might be .me and .bz, but  they will not bring in a very good profit when you try to sell them. 
Watch Out For Scams:
Anyone who has spent any time on the Internet knows there are scams and con artists out there.  It's important that you pay attention to offers and if that alarm goes off in your head -- run!  You might come across a domain that someone is selling and it seems like a good deal because the seller wants very little for the domain.  Unfortunately, in most of these cases, he or she does not own the domain or have the right to sell it!  If that alarm is going off in your head, then get away from it.  A really short, good domain that has a .com extension is being sold for pennies, you should realize something is terribly wrong with that deal.  If it sounds too good to be true --
You've Got To Put Work In To Get Money Out:
Domain flipping is not a passive income where you can just sit back and watch the money roll in.  You are buying and selling each domain individually and that takes work.  Once you start making some decent money and see a good profit, you can always outsource the work and develop your own small business.  That is how you turn domain flipping into a passive income.
Get To Work:
Like any online business, it takes hard work and dedication to become successful.  Using common logic and watching your budget will bring you to a level of professionalism.  As you become more and more knowledgeable in domain flipping ,  you will start making a good income.  Don't expect it to happen overnight, take you time and learn all you can along the way.  You will probably make a few mistakes but just learn from those failures and keep moving forward.