Price of aircraft

[bigbloke]

Hi

From experience are prices advertised for used aircraft typically fairly firm or do they tend to be optimistic ?

Obviously any price is subject to negotiation but are we talking about 5% below asking or 50% below ?

Thanks

BB

[Contacttower]

I asked a similar question several months ago and was told planes tend to go 20-30% less than advertised. I don't know how true that really is though.

[IO540]

Depends on the plane.

Most IFR tourers seem to be advertised (UK) at about 30% above what they actually sell for, and at this time of the year the gap will be even wider.

[xrayalpha]

Hi,

I know in Scotland (not England) houses tend to sell for 10 to 30 per cent over the asking price. Whereas cars sell for less.

Aircraft also sell for less, but how much less also depends on how they have been priced.

In microlights, I tell students that vendors will be happy with a 10 per cent cut - but then 10 per cent of a 50k microlight is 5k and that can seem quite a bit!

There again, a 3,500 microlight might sell for just 2,500, maybe even 2,000 if it was well over-priced and has hung around for a while - and that is a whopping percentage discount.

It also depends on the model, condition, colour scheme etc etc.

You are doing the right thing by asking around.

[radicalrabit]

Some of the things we have been sent details of this last week are so cheap I think they will be giving them away in Cornflakes in a bit. Yesterday we were offered a '74 Learjet for £80k.

[bigbloke]

Uk for preference but I guess US if the price merited the higher costs of acquisition.

[BroomstickPilot]

Hi Guys,

The thing that I notice, that makes me curious is the number of aircraft for sale that have recently been; rebuilt, recovered, repainted, had new or reconditioned engines, recent top overhauls, etc. Expensive work carried out shortly before sale and I wonder why.

I imagine, some of these will be old, tired, but fundamentally sound A/C that have hung around in the 'for sale' lists for ages and the owner just wants to get finally rid.

Some will be classics belonging to an owner who enjoys building/restoring more than flying and now wants to sell one he has just finished and move on to building/restoring another one.

Some others will be rust-buckets that have been tarted up for sale to some poor unfortunate gullible muggins.

Some will be old military birds that cost a fortune in upkeep.

Can anybody think of other reasons why someone would sell an aeroplane after having just spent a fortune on it?

Broomstick.

[411A]

Can anybody think of other reasons why someone would sell an aeroplane after having just spent a fortune on it?


Pending divorce.
That's how I bought mine...the seller said, 'the bit@h won't get it.'

[Fuji Abound]

All the usual reasons:

Change of circumstances,

fed up with rising costs, particularly Avgas,

cant sell without a C of A and the aircraft needed a new engine.

[Rod1]

Group bent it 3 times in 6 months and the newly rebuilt engine uses the last of the group funds and the members own money?

The price of Avgas and the increases in maintenance has focussed buyers on the running costs far more than 5 years ago. This trend is likely to continue and could lead to very bad depreciation if you jump for the wrong thing.

Rod1

[wsmempson]

I think that the question you are asking is almost too big - akin to "the price of houses" - which house, where, how big etc. etc.

However, If you're talking about GA tourers, once you've got over the intitial depreciation - which is akin to new car economics - age tends to matter less than condition and the value tend to be determined by where the a/c is on it's various maintenance cycles.

There are three main areas of expense; engine, avionics, airframe (bushes, undercarriage, rose-joints etc) paint and interior. Paint may last 10 years if looked after or 5 years if not. Engines generally have a Time Before Overhaul (TBO) of 1,800 or 2,000 hrs - and a further 10 or 20% on condition (depending on the model); with a flying school a/c this may only take 4 years to rack up - with a privately owned aircraft it may take 30. Remember that there is a new EASA requirement that the a/c cannot be used for public transport work if the engine is more than 12 years old. Interiors last for as long as the owner will look after them and avionics deserve a thread all to themselves.

Suffice to say, taking this to absurdum, an aircraft which needs all of the above renewed should be the cheapest of it's kind and an aircraft that has had all of the above recently refurbished/replace/overhauled will represent the top of the market. Therefore, logic would dictate that an aircraft should be worth what the best of it's kind will fetch, less the cost of doing the work.
However, in the world of very aged spam-cans that is largely that of GA, life is not always that simple; given a PA28 140, where the best example can be bought for £30,000, the sums for a knackered example are APPROXIMATELY as follows; £10k for engine overhaul, £5k for paint, £3k for interior and £12k for new nav/com, transponder and DME. This sum should suggest that there are lots of tired old aircraft knocking about for free - which clearly there aren't.

The sum works better with PA28 161's or 181's, where you can buy a tired machine for £25-35k and spend the money and your machine will then resell for £50-60k quite readily.

Another post suggested that the values of the UK GA spam-can fleet were being knocked by the availability of newer, nicer a/c like Cirrus appearing on the s/h market and I suspect that this will is true and will continue to affect values. However, no-one yet knows what it will cost (or if it will be possible) to prolong the life of some of the plastic a/c in the same way as had happened to the old spam-cans. I watch with interest....!

As to negotiability. you have to decide what the individual aircraft is worth independent of what the owner is asking; if you buy the aircraft based simply on the size of discount off the asking price, you are likely to end up buying the aircraft that was most over-priced, rather than the best value for money!

Happy hunting:)
For in

[radicalrabit]

At the moment a lot of the USA is suffering form the knock on effects of their financial crisis. Because the companies have been selling off aviation assets the market is down, therefore people who had the money could afford to buy better. The cheaper end then didnt get sold to the people who would normally buy them. This and the cost of fuel and the Dollar weakening against the pound. Also if you are in the market for a jet the wealthy people and corporates buy new so what to they do with all the old ones? There is a limited market for used exec jets, who can afford to buy and run them? But then that goes right down the chain. All these are influencing what aircraft are getting sold at what price and to whom. As has been said the condition of the engines and the current tbo/other schedules are a factor. It may mean that people spent the money doing up rather than buying new, then realised they had to sell anyway . That has been the result of my research. There are a lot of very helpful and informative people on here and that has amazed me how much they are willing to help people new to flying. Thanks Guys !:ok:

[sternone]

I find the price negotiation the easy part on buying a plane... all the other descisions are much harder!

[wsmempson]

Have you bought an a/c now - I thought you were still studying for your PPL??

[BroomstickPilot]

Thanks, Guys, for some very interesting and informative replies.

Broomstick.

[IO540]

Can anybody think of other reasons why someone would sell an aeroplane after having just spent a fortune on it?

A wise explanation I read somewhere is that most owners keep trading up until they end up with something they can't afford to keep, and then they have to jump off the train.

OTOH those that stick with a plane they can afford to keep tend to remain happy and they tend to keep it for a long time.

There is also the issue of changing mission capability requirements but I suspect this is a much less common reason for selling. For example the TB20 does me well for UK and European flying and the only meaningful mission capability increment would be say a Jetprop and that would make sense if I was constantly flying ~ 700nm legs and rarely doing short trips just for currency and fun. But the operating costs would jump by best part of an order of magnitude... no free lunch.

I can see somebody selling a spamcan to get something better (say a Cirrus etc) but I bet you most of those selling SR22s or TB20s etc are people who are being forced to sell up because they have run out of money, or possibly just got fed up with flying. A very small number have traded up to turboprops.

Except in rare cases, never get back money spent on avionics. If you put in a TCAS/GPWS/EHSI/etc then you have to keep the plane for many years afterwards.

Re depreciation, there have been massive changes in recent years. I bought a new plane in 2002 and a year later somebody offered me what I paid for it. This was because the price of a new one went up 20% in that year. Then ........ Cirrus came along and by shifting a few thousand planes bombed the constant IFR tourer price rises which had for decades propped up the used market. Later, Diamond and others bombed the market lower down.

Today, it's hard to give a plane away. You have to initially make a hard nosed evaluation of your mission capability and what you can afford long-term, and go for it, and stick with it. Or forget it altogether. This is not a silly-price hobby like ocean going yachts etc but equally it cannot be run on a halfpenny like so many people seem to think it can.