A bit of a long question but here goes... I have just created a new website with a new domain name. I have an aged domain (maybe 5 years old) that have never really done anything with other than keep a basic web page with relevant keywords. Noticed that this old domain is now ranking page 1 for relevant keywords for the NEW website. I have set up an http redirect on the old domain pointing to the new domain. Is this the best way to handle this and drive traffic to the new website? Thanks
The redirect will kill the rankings. If you want to keep the benefit of the aged domain you'll have to keep content on it. I'd just forget about the new domain and build your new site on the old one.
your ranking for new domain would go down, although you may get the same ranking for new website but all the link juice of old domain will get vanish. If you are looking to use the old domain anywhere in future then you should remove the redirect and either you should redesign the old domain or start link building for the new one.