Owning a US based aircraft - catch..?

[Kingy]

Hello,

OK I have a question, I've had a mad idea that to buy a N reg aircraft, base it in the States near a cheap place to get to and 'nip' across to fly it now and then...

Has anyone tried this? - what is the catch..? what am I forgeting?

The exchange rate is so tempting right now at 174-1. It means that you can buy a servicable 2 seater for about £8K and gas is cheap... think about it!

Kingy

[knobbygb]

Well... there's pleny of Brits buy property out there - usually around Orlando :yuk: with no problems, so it should be possible.

Ideally, you'd buy a house on one of these private airfields where you have a hanger rather than garage, and the street outside is the taxiway. Sell some shares in the aircraft/propery combo and rent it all out to other pilots when not in use by the shareholders.

From the amount of interest in US flying on this board alone, I think many (me included) would be biting your hand off to go on vacation there for a couple of weeks. There's got to be loads of tax and work permit type issues, but you never know, you might even be able to make a small profity to fund your own trips over there :ok:

[flyingfemme]

As a non-US resident/citizen, you will need a trust company or some other ownership arrangement.

Insurance may be interesting - but shouldn't be insurmountable.

[englishal]

What you could do is lease it back to a flying school while you're away from the US. I've thought about this, you'd get the tie down / maintenance / insurance paid for, and MAY even make a little profit. Just inform the FBO when you want to aircraft available.

Saw a C150 Aerobat for sale for $12000, which would be a right laugh, nice clean looking aircraft....

Maybe a couple of ppruners should get together and do this? I'd be up for it if it was based in California, and it tends to be fairly cheap to fly into LAX....

Cheers
EA

[formationfoto]

Spoke to a Brit giving rides in a Harvard at Kissimmee after sun n fun last year and he said there were quite a few Brits with warbirds and exotica based in the Orlando area whi fly over for lengthy weekends and extended stays. If you can save £200 an hour on operating costs it makes sense to hop on a relatively cheap transatlantic flight to visit your 'toy' every few weeks.

He was talking Harvards, Mustangs, and up but I guess the argument though less pronounced also applies to smaller and cheaper kit.

The added advantage is that the weather is reasonably predictable.

Some of the guys have holiday homes (which they also rent out) others simply stay in cheapish hotels.

[I have control]

As a non US-citizen you can't own an aeroplane in the USA, but you can set up a corporation to own it on your behalf - a simple Delaware company is the route most people go, will cost you a couple of hundred dollars to set up.

[411A]

Don't want to throw cold water on this idea but the FAA in Oklahoma City is now looking very carefully at foreign ownership of private US civil aircraft, thru a trust/corporation or otherwise.

Why you ask?

Remember 9/11.

It takes awhile for the wheels to turn, but grease has been applied recently.
This info comes straight from OKC.

[Julian]

IHC,

Whats a Delaware Company?
PM me if it a bit lengthy or you dont think relevant to the thread.

Regards,
Julian.

[dublinpilot]

Presumably it's a company incorporated in the state of Delaware?

It would own the aircraft, and you would own the company. Therefore the airplane is owned by a US company.

Well that's the basic idea anyway.

[IO540]

I have control

Do you know who can set up a trust for $200? You may have missed off a zero there.

411A

This kind of thing has been talked about for years. Many people have been saying it will be stopped soon, etc but nobody has been able to come up with anything concrete - it's always a dark rumour which has been passed down many "generations" and probably comes off the internet anyway. In its frequency and persistency it ranks alongside stuff like GPS degradation whenever the Americans are doing some military operation...

The world is full of N-reg planes. Many are large commercial (cargo) operations. Are the FAA really going to shut them all down? If so, what would be the benefit to the FAA (or to anybody else) and what would be the alternative?

Closing the non-resident N-reg option would create a huge commercial opportunity for an alternative aircraft registry. In reality, any country (3rd world or otherwise) is free to set up an aircraft registry. Then, if they choose to respect FAA licenses (I say "FAA" because the FAA IR is the only IR presently practical for PPL-type pilots) - Liberia, B.V. Islands are examples - and do it cheaply enough, then the N-reg will become irrelevant. Unless the national authorities (e.g. the UK's CAA) then choose to ban aircraft on that country's registry being resident... but they would no grounds for that if that registry chose to imitate the FAA (FAR) operating requirements.

If there was a usable European PPL/IR the situation would be different, but this is only a selfish perspective of mine :O And anyway nobody (outside the USA with their tradition of personal freedom) gives a damn about GA; it's only the airlines that matter. There are much bigger commercial interests which will make a wholesale N-reg ban very controversial.

Banning non-USA-resident N-reg is nothing to do with stopping 9/11 type terrorist acts. They could do it but I ask again: what would be the benefit to the FAA ?

[Circuit Basher]

IO540 - agree with the general sentiments and don't know the aviation licensing regulations for all countires, BUT.....
I would strongly suspect that Canada has very similar IR and aircraft reg requirements to US (but Transport Canada is independent of FAA), also I suspect that Oz, NZ and South Africa would be very quick to jump on the bandwagon if the FAA turned away the market that is currently queueing at its door for licences / ratings / aircraft trust companies.

[fernytickles]

IO540 - 'I have control' certainly did not miss a zero on the estimate for setting up a Delaware company (not a 'trust fund'). We have both been through the process and own aircraft using this method, as do quite a few other non-US citizens.

Should you wish to avoid the middle man, just go straight here and you can find all the info you need...
http://www.state.de.us/corp/default.shtml

[formationfoto]

Getting a trust set up to operate an N reg aircraft for you is not that expensive and certainly not to the level of an additional '0'.

Tom Hughston at AFT in Norwich is offering such a service as are a number of others who advertise in the back of PILOT (and other magazines).

[Aim Far]

Surely the comparison here is not between owning an aircraft in the States and owning one here. That's no contest.

But comparing ownership costs in the States to rental in the States is a different matter. Why own when you can rent a PA28 for $55 (or thereabouts) an hour wet?

[Kingy]

Thanks for the comments for guys - On the face of it, it's a 'do-able' thing subject to a few tricks and turns - great! - I'm gonna have a look at this properly in the new year.

Aim Far,

Why own? a good question... simply, I don't fly PA28's - I would be looking at C120/140s and Luscombes etc. you can't rent them easily...!

Kingy

[Rosbif]

I had a 1975 cherokee with full IFR digital stack and the Quadrant controls like a warrior. I was a UK citizen at the time ( now Canadian), and so technically unable to own the thing. All I did was draw up a contract with the fellow who owned it to lease it from him with an option to buy it for a buck any time I wanted. He used to rent it from me from time to time. We also had a contract that stipulated that I pay all of the taxes. (this was Texas, but I would think that FL has the same thing.)
It worked out fine. I sold the plane eventually, and he transferred ownership to the 'third party' as specified in our contract.
This ownership stuff is the same crap as the student visa stuff. Everybody knows how to get around it. It just makes the lawyers richer.
Never had a plane on the Canadian register, but I believe that you are supposed to be Canadian too.
Try Sao Tome and Principe. I heard that they will even give you a mechanic's licence so you can do your 'own ' annual !! (S5)
British Virgin Islands are very sticky on this as well . Avoid the place. especially Turks and Caicos.

Hope that helps.

[cgjog182]

All you guys are typical Brits. Look at a problem, figure out the absolute most difficult, unrealistic and impractical way of solving it.

"By God, we've got it!"

An airplane that sits, suffers. Even a couple of hours every weekend is not enough exercise for the engine. Why buy?

Has anyone ever heard of renting. There are a gazillion rental aircraft throughout Florida just waiting. Some of the machines are actually pretty good. Take a look at Ft. Lauderdale Exec.

Bring your headsets, your GPS, get your U.S. license issued based on your British one. TaDa.... you now can fly in the U.S.A.

[Flyboy-F33]

cgjog sounds like a real 'expert' ...I dont think!

If you purchased the 150 at such a low rate, you could keep it there for a couple f years, then ship it here and sell it for more than you bought it for, including the freight costs. In fact, if it's ahlf reasonable, you could rent it to a flying school here and have a monthly income to subsidise you flying here.

Fly.....

[Onan the Clumsy]

Flyboy You have a lot to learn.

(That wasn't meant to be rude, just honest).

How do I know this? Because I used to own and lease out (through a school) a couple of 172s. It was a royal pain in the ass and yes, I lost money on the deal - and I still wonder how honest the school was being as I've never seen a 172 burn 11 gallons an hour.

All this and I was a half hour drive from the airport. Think how difficult it will be to changer a tyre from across the Atlantic.

If you remember nothing else, remember this: If it flies, floats or fcuks, it's cheaper to rent it!


Also, the two happiest days of aircraft (and boat) ownership are the day you buy it and the day you sell it.

Good luck :ok:



Now go and read Cgjog's post again

[LowNSlow]

So the KAF (Kingy's Air Force) is expanding across the Atlantic :cool:

Having previously rented an Aerobat to a flying school I agree with Onan, it was a right Royal pain in the arse, especially when the Inland Revenue tried to sting me for benefit in kind as it was technically a "company vehicle" :yuk: Insurance won't be cheap for a rental aircraft either.

Surely there must be rental companies in the US near where you want to go that rent out Citabrias and such like if your need the 3rd wheel at the "proper" end of the aeroplane?

cgjog182 we've been well trained by our CAA who have perfected the art of keeping aeroplanes out of the air. If you want details, ask any Tiger Moth owner who has his aeroplane on a C of A :uhoh: :uhoh:

[Onan the Clumsy]

Here are some numbers for you that might apply to a 172:

(admittedly I'm a little out of touch now but they'll be close enough)


Insurance - let's say $500 a year

Tie down (though a hangar would be much better) $35 a month - $420 a year

Annual - let's say $600


So your annual total is already aroung $1600 - and that's if nothing breaks (which is VERY unlikely).


Now a 172 should burn around 8 gph, at around $2.50 - say twenty bucks an hour.

Wet rental is in the neighbourhood of $60 an hour, so it'll cost you say $40 an hour extra to rent

So what this means is that you have to fly your airplane for about 40 hours (1600 / 40), before it even breaks even for you. After that, you'll save $40 an hour, for an investment of severalthousands of dollars.


And remember this ignores replacing failed components, financing charges and airline tickets just to get over here.

Anyone care to comment?

[englishal]

So what this means is that you have to fly your airplane for about 40 hours (1600 / 40), before it even breaks even for you
Which is a very good reason to lease it back to a flying school in your absence. Do it right and you can end up with free flying, and at the end of the day, you own a plane :D

I think (I know) if you approached many flying schools and suggested such a scheme, you'd get insurance provided, tie down provided, maintenance provided and a modest $20 per hour for every hour flown by flying club students.

as a side note, I enquired about tie downs in California, and a typical rate was $100 per month

Cyer

[willbav8r]

I have to add to Onan's figures regarding hangarage, annual etc.

Maybe that holds for rural areas, and new airplanes, but you could figure more realistically $80-$100 for tie down, $250+ for a hangar, and a more realistic budget of $3,000+ for the annual.

Insurance is more likely to run $2,500 these days.

This is feedback from folks here on the West Coast, which I imagine is at the high end of the scale....

I know a chap that only breaks even if his Warrior gets 65 hours or more per month.

[Onan the Clumsy]

Englishal I used to think that before I put my two up for lease, but was shown the error of my ways.

One point: If you want to lease one out, you'd better get a good one with lots of navadis and most importantly of all - a good paint job.

Then you might want to bribe the instructors so that they use your a/c instead of another...like maybe the one the flight school owns.

Then you'd better cross your fingers and hope you don't have what happened to me happen to you: the b@st@rds crashed it.


My baby. A beautiful 172 with 100 hours on the engine, leather seats, metal panel, Collins stack with dual glidescopes, ADF, DME, Loran, intercomm, flap gap seals, Cleveland brakes etc etc etc.



So go for it, but don't say you haven't been warned. :ok: