aristotle - 12:33 pm on Apr 8, 2013 (gmt 0)
There's an old theory (or speculation) that Google waits to see if the domain registration is re-newed past the first year before giving full legitimacy to a site. I don't know if this is true or not, but it does make sense logically.
I used to get occasional emails from a domain registrar claiming that Google checks to see how far in advance a domain registration extends, and uses the information as a ranking factor. Domains such as .com, .net, and .org can be registered for up to ten years in advance. The theory is that an owner who registers the domain for ten years in advance must be serious about creating a good site. Again, I don't know if it's true or not, but it does make sense logically.
Before I link out to another site, I often check its domain registration to see how old it is, and how far in advance its registration extends. If it's less than a year old with a registration that's due to expire in a couple of weeks and hasn't been re-newed, then I might not link to it.
Personally I have a lot more respect for a site that's been around for ten years than a site that's only three months old. The older site has proven that it has staying power, and its longevity indicates that its owner values it and has probably put a lot of time and effort into it.
P.S. - I wonder what percentage of domains are allowed to expire after the first year. Has anyone seen any data on this?