Are buyers always like this?

To paraphrase Kenny's song "You gotta know when to hold'em, fold'em, walk away and run." A high percentage of both buyers and sellers are 0-for-4 in that mental exercise, at least on their first airplane. Sometimes they smarten up after that.

steingar said:
Keeping an airplane for the "appropriate" price seems to me like a loosing proposition. You can do that with a car or a bike, they sit in your garage and aren't really harmed by it, you can start them up from time to time. Might even make sense for a house if you're still living in it.

Airplanes live in hangars which cost money. If they live in a hangar they're paying insurance, money. They need an annual inspection, potentially lots of money (thinking about the $14,000 annual here). They're expensive as all get out to operate, and degenerate when they don't.

I don't care what valuation service anyone uses to figure out what their aircraft is worth. Like it or not, the airplane is worth exactly what a customer is willing to pay.
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steingar said:
Keeping an airplane for the "appropriate" price seems to me like a loosing proposition. You can do that with a car or a bike, they sit in your garage and aren't really harmed by it, you can start them up from time to time. Might even make sense for a house if you're still living in it.

Airplanes live in hangars which cost money. If they live in a hangar they're paying insurance, money. They need an annual inspection, potentially lots of money (thinking about the $14,000 annual here). They're expensive as all get out to operate, and degenerate when they don't.

I don't care what valuation service anyone uses to figure out what their aircraft is worth. Like it or not, the airplane is worth exactly what a customer is willing to pay.
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Indeed. If the "correct" price, as deemed by Vref or some other market fairy, is $66,000 and it costs you $6,000/yr in hangar, insurance, and pencil-whipped annual expenses, then getting the "correct" price a year from now is no different than lowering the price to $60,000 and selling it today.

I made that calculation when I sold my Commander 2.5 years ago, and fairly priced it accordingly. One other 112 that was for sale at that time is still being listed! Even then, I got the low-ballers as well. My broker weeded those out for me, but she told me there are those who shop on price. They won't care what plane it is they buy, as long as it meets their budget.
 
The good news is that buyers aren't all like that. I offered a client's F-90 last Monday, had an excellent offer from a reputable firm in hand on Tuesday. The buyer will use a reputable well-known local shop for the pre-buy. The price was listed as "make offer."
 
Here's a twist, I need parts for my F-24, there is a project near here that has no engine, hasn't been flown since 197?, has a bent fuselage, no radios, it's all apart, and in a barn. he has been advertising it for $6500.00 and not sold, what should I offer him for it?

I need his 2 gear legs, to build new I'll spend $2000 each, his are good to go. plus he has a lot of sellable parts.
 
i usually just offer what its worth to me. if that lines up with what the seller thinks it is worth then we make a deal.
 
N2124v said:
Low ball offers are all part of business. If you get offended by low ball offers in a business transaction, then maybe you should consider removing yourself from the equation and use a broker.
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Yup, get used to it.
 
Buy it. At the rate these old codgers are crashing their 24's, you'll be able to sell off the other stuff pretty quickly.

Tom-D said:
Here's a twist, I need parts for my F-24, there is a project near here that has no engine, hasn't been flown since 197?, has a bent fuselage, no radios, it's all apart, and in a barn. he has been advertising it for $6500.00 and not sold, what should I offer him for it?

I need his 2 gear legs, to build new I'll spend $2000 each, his are good to go. plus he has a lot of sellable parts.
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Gubbins said:
It happens with everything. Have you ever sold a house? You always get at least one buyer who offers you 30% under what you're asking with a straight face. Then you get to decline their kind offer with an equally straight face.
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Yeah, and then if you relent and sign the papers for the 30% low offer, they then find "discrepancies" that they demand you fix (at your cost) or threaten to sue for.
 
oldShar said:
Yeah, and then if you relent and sign the papers for the 30% low offer, they then find "discrepancies" that they demand you fix (at your cost) or threaten to sue for.
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What would they sue you for? If they demand you fix something you politely remind them that you already lowered the price. The deal is not done until all the paperwork has been finalized and the checks have cleared the bank.
 
They sue after closing for failure to disclose or willful misrepresentation.

N2124v said:
What would they sue you for? If they demand you fix something you politely remind them that you already lowered the price. The deal is not done until all the paperwork has been finalized and the checks have cleared the bank.
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Ted DuPuis said:
Wayne, haven't you learned by now that experience is no match for speculation? ;)
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I wasn't speculating on anything. I said that some people will take the money and run, and that's not speculation. It's fact. It was the entire basis of one broker's sleazy business practices here in Denver for years.

Remember this is the same guy who'd negotiate a price and show up with multiple cashier's checks saying he had to pull the money from multiple banks if the seller didn't take only the check that was $5000 or so, light. He'd act like he only had that one check in his pocket up until the seller became "offended". It worked. I saw him do it. Always some story about how he'd done more "research" and the airplane wasn't worth what he'd negotiated over the phone if he thought he had a sucker on the line.

There's a bottom feeder market. I doubt Wayne dabbles much in it. Scumbags abound. And some of us have seen them in action. That would be what?

Oh yeah, experience...
 
That's what escrow services are for.
 
Ted DuPuis said:
Jose, we all have a budget, and we all want to get the most for our money. But there's a point where you're wasting your time as well as someone else's.

With airplaness, dollar signs add up very quickly. If you can't afford a $20k difference between two airplanes (just using $20k as an example, but it's probably not a bad number), it's entirely possible you can't afford the plane. While you getting in over your head isn't my problem as a seller, per se, it's been my experience that buyers who aren't in the best position to afford an item (plane, truck, whatever) are typically the ones who are the most difficult to deal with, and usually just prove to be a waste of time.
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You are speculating on the guy being able to afford the plane or not, because he has set a budget at $60k. People have all sorts of reasons why they want to spend a fixed amount of money, NONE of them matter to the seller. The guy might have just sold his motorhome for $60k, that is what he has for a toy budget. He might have his loan approved for $60k, that might be what he has for his budget. He might have an inheritance for $60k, etc..... For all you know, this might be his third plane, and he is buying it for his kid to take flying lessons and he can easily afford the plane, he just has set a budget. Nothing wrong with that.



If I ask if somebody would "consider $60k", then I would know that I can afford $60k and have it available.

As for the "waste of time", an email or a text message isn't a big waste. The seller would be able to just delete with all the other crap they get in their inbox each day, or, reply with a "Hell, No!" and both parties move on.

If you think about it, why do people do "Pre-Buy"s? It is because buyers don't trust sellers to properly maintain/disclose the condition of the plane, or, to have kept up with maint. It doesn't mean the seller is a bad person, it just means the buyer is protecting the buyer's interest, not the seller's. And, that is the whole point of a transaction, each person is ultimately responsible for their own decisions.


As an aside, on the negotiating part, I don't like when buyers come and start picking my item apart, pointing out what is wrong, how much it will cost to fix, and how I need to discount it because of wear/tear/panel/engine time, etc. I know what is wrong/right, I know what price I want, I don't need to have somebody point that stuff out.

It would be interesting to see how many sellers are actually "surprised" by what is found in a pre-buy. ;)
 
JoseCuervo said:
You are speculating on the guy being able to afford the plane or not, because he has set a budget at $60k.
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When you have a $60k budget, you should be looking for $30k aircraft, not low balling the $80k owners.
 
JoseCuervo said:
It would be interesting to see how many sellers are actually "surprised" by what is found in a pre-buy. ;)
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Out of the 5 pre buys I have gone through in the last 2 years, 3 of them were genuinely surprised by the results of the pre buy.

With the 170 I did buy, the owners were a group of elderly partners who hardly flew it (less than 10 hrs the previous year). They didn't look very closely and assumed it was in better shape than it was.

There was the SNJ with the pencil whipped logs- that elderly owner had a 'big name' IA doing the maintenance and had spent top dollar on some big ticket repairs. He honestly believed the airplane was rock solid. It was not.

Then there was the Nieuport replica. That seller was the daughter (not a pilot or A&P) of the owner who had passed away. She had no idea what condition it was in, but assumed that because her
father flew it, it must be okay.
 
Fearless Tower said:
Ain't that the truth!
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Just think, you have a $60K budget, low ball a $80K owner at $60K and he takes you upon it, because he can't afford the maintenance required to be airworthy.

Now you have a $80 aircraft that you can't fix. or fly.

then someone low balls you at $40K.

the theory is called the fool chain, you must fine a fool dumber than you to get you out.
 
Tom-D said:
When you have a $60k budget, you should be looking for $30k aircraft, not low balling the $80k owners.
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How do you know the buyer doesn't have an "$80k budget" and is looking for $60k planes? One can only know there own side of the transaction.

Similarly, the seller might have been one of those "let's put it on for $88k, and see if we get any offers". I will gladly take $75k as the C-210 I am buying is closing next week on that transaction.

Lots of buyers with lots of reasons/motivations, lots of sellers with lots of reasons/motivations. That is the great thing about a market, eventually two parties move to the same point, and we have "market value" based on the willing seller and the willing buyer.

The "low baller" will eventually get tired of sending emails if they get a bunch of "no's", but, they may also get an airplane. The high priced seller may get tired of a bunch of "low-ball" offers, and, eventually they may find somebody who will pay their price, or, will lower the price, or, will have a plane continue to sit on a ramp.

I guess, as someone who has been on both the buy side and the sell side, I will always want more information, and, more offers to buy, more offers to sell, thus allowing me to have confidence in the most efficient price for the item.


Tom-D said:
Just think, you have a $60K budget, low ball a $80K owner at $60K and he takes you upon it, because he can't afford the maintenance required to be airworthy.

Now you have a $80 aircraft that you can't fix. or fly.

then someone low balls you at $40K.

the theory is called the fool chain, you must fine a fool dumber than you to get you out.
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Who knows? Maybe the guy with the $60k budget has a $3k per month maintenance budget??? But, he doesn't want any debt, has $60k from the sale of his motorhome or some other toy.

Is the maint of a $60k c182 that much more than the maint of the same plane as if he spent $80k on it??? I would guess the same maint costs, no matter what price he paid on the plane.
 
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Tom-D said:
When you have a $60k budget, you should be looking for $30k aircraft, not low balling the $80k owners.
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Unless your $60k budget really is your purchasing budget and you already have the additional "HTT pilot forum-approved" reserves set aside.
 
Tom-D said:
Here's a twist, I need parts for my F-24, there is a project near here that has no engine, hasn't been flown since 197?, has a bent fuselage, no radios, it's all apart, and in a barn. he has been advertising it for $6500.00 and not sold, what should I offer him for it?

I need his 2 gear legs, to build new I'll spend $2000 each, his are good to go. plus he has a lot of sellable parts.
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Why not partner together on parting it out? You get the parts you need and the two of you split the profits. You know then what really is a fair offer.
 
Jaybird180 said:
Why not partner together on parting it out? You get the parts you need and the two of you split the profits. You know then what really is a fair offer.
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Because he simply wants to sell it.
 
BillyBH said:
I think Velocity hit it on the head. Sellers that bought high need to adjust their frame of reference. It doesn't matter what you paid THEN. The buyer is looking at what it is worth NOW. The buyer is not a scumbag because the market has tanked.
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I put my Apache up on the market a little while ago and eventually decided it wasn't worth the trouble. My typical offer was between $500 and $1,500. That's the correct number of zeros in those numbers, I didn't typo. My plane's in annual and all ADs taken care of. I don't think the market has tanked THAT much.

We decided to keep her in the family because it wasn't worth the headache of our phone ringing several times a day with offers in this range. I think the highest one I received was just over $6k. My asking price was pretty low to begin with, as many on the forum agreed. Anyways, I think that there are a lot of scumbag buyers out there right now trying to take advantage of those who are desperate, and not simply that the plane is worth less than a used ultralight.
 
Four deals in progress now with total value of ~8.x mil. None appear to be bottom-fishing, but I guess that could change.

denverpilot said:
I wasn't speculating on anything. I said that some people will take the money and run, and that's not speculation. It's fact. It was the entire basis of one broker's sleazy business practices here in Denver for years.

Remember this is the same guy who'd negotiate a price and show up with multiple cashier's checks saying he had to pull the money from multiple banks if the seller didn't take only the check that was $5000 or so, light. He'd act like he only had that one check in his pocket up until the seller became "offended". It worked. I saw him do it. Always some story about how he'd done more "research" and the airplane wasn't worth what he'd negotiated over the phone if he thought he had a sucker on the line.

There's a bottom feeder market. I doubt Wayne dabbles much in it. Scumbags abound. And some of us have seen them in action. That would be what?

Oh yeah, experience...
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JoseCuervo said:
You are speculating on the guy being able to afford the plane or not, because he has set a budget at $60k. People have all sorts of reasons why they want to spend a fixed amount of money, NONE of them matter to the seller. The guy might have just sold his motorhome for $60k, that is what he has for a toy budget. He might have his loan approved for $60k, that might be what he has for his budget. He might have an inheritance for $60k, etc..... For all you know, this might be his third plane, and he is buying it for his kid to take flying lessons and he can easily afford the plane, he just has set a budget. Nothing wrong with that.
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Actually, it does matter to the seller what the reason is. If you set your budget at $60k but you can afford to spend more (which you really should be able to), then that means that you're likely a more serious seller and more probable to be able to complete the deal. People with minimal financial capability to handle a sale are typically the ones that have the shakiest probability of completing it.

If I ask if somebody would "consider $60k", then I would know that I can afford $60k and have it available.
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That's not always typical with the low-ball buyer. I had several people come to me who wanted me to finance their purchase of the Aztec for them. They were willing to pay X amount, but didn't have the cash sitting around.
 
onwards said:
Seriously.

Seriously?

I am looking to buy. I have the cash - and I'm not even looking for the $30-40K perfect 172, but rather a $70-80K perfect 6-seater. I have negotiated two deals successfully thus far, but both planes fell apart when things came to light during closing (I find that some sellers lie a lot - I'm not offended, just cautious). Such is life. I am very, very patient. I strongly believe that the market at present plays in my favor, and will continue to do so in the next 2-3 years at least. So I have plenty of time to wait, and in the meantime, my money is making more money. And as much as you won't like to hear it as a seller, I am waiting precisely for someone who REALLY needs to sell their plane, because life has made it so. They will appreciate it when I can close quickly with cash on hand for what is a fairly large purchase.

When I do buy, it will be the right plane at the right price from MY Perspective, and not anyone else's. I couldn't care less what the seller paid for their plane or how much money they put into it, or what they have emotionally invested in it. I care about what I perceive the value of the plane to be when I buy it, because the moment it changes hands, *I* become the next seller.

And right now, in this market, my perception is that planes are worth roughly 30% under what VREF tells me they should be worth. So that is MY bottom line as a cash buyer looking in a segment that's been hit particularly hard. So those are the offers you'll be getting from me. I am certainly dead serious, just disagree with your valuation. Feel free to counter. Insulted? whatever.
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I am curious about your post. I haven't been following the 6-seater market lately, so when you say $70k-$80k, is that what you're willing to pay (i.e. the 30% under Vref)? What kinds of models and years are in that price range?
 
Don't try to look in the other guy's pocket. Make your deal based on what's in yours.

Tom-D said:
Just think, you have a $60K budget, low ball a $80K owner at $60K and he takes you upon it, because he can't afford the maintenance required to be airworthy.

Now you have a $80 aircraft that you can't fix. or fly.

then someone low balls you at $40K.

the theory is called the fool chain, you must fine a fool dumber than you to get you out.
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ScottM said:
You're asking X, a goof ball offers you something substantially less than X, counter with X+25%
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Heh. I've done that on stuff when I was SURE the guy was lowballing to be an ass...

"Price just went up."

It gets them off the phone, anyway...
 
Never bought a plane but I've bought and sold lots of other stuff and here are my thoughts.

From the lowballer's perspective why not make the low-ball offer? Worst case scenario is the seller says no. You might also get their bottom dollar price or(rarely) actually get the item for your low-ball price. Unless the low-baller truly needs the item you're selling right away there's really no disadvantage to him to make the offer. I also know of people who actually enjoy seeing how low they can talk someone down to.

All that said, I hate haggling. In a perfect world I'd rather just have a set price have that be "it" and pay it. This isn't how most transactions go, however so I've adopted the following basic method.

Whether buying or selling, first I research what the item is actually selling for. For anything relatively common, ebay is a great resource for this as they have a feature that lets you search for "completed listings". There are other sources of information of course, it all depends on what you're talking about.

If I'm buying, I take the low end of what I see the thing selling for and offer that much. about 90% of the time the seller takes the offer and we're done.

If selling I figure the lowest end as the minimum I'll agree to sell for, then price it about halfway between high and low for what I see it going for. Again, if someone offers me my minimum or better, I sell it. If a great deal of time passes and I get no good offers, I start lowering my price expectations until I can get it sold.

That's the painless and fair way to do it. Some people like to chase the deal, if you apply the above method and are firm you can deal with them too.
 
Tom-D said:
When you have a $60k budget, you should be looking for $30k aircraft, not low balling the $80k owners.
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Again making assumptions. I'd argue that when I had a $60k budget, $60k planes (purchase price) were no problem. I had a solid budget for insurance, hanger, annual and "oh crap?" monies. I actually bought a plane listed at $75k within my budget and I didn't low ball him. I told him what I had to spend and asked if he was interested or not. He had his second experimental ready for the engine. It was the start of winter so he wouldn't be flying anyway. I had to get it from Canada to the US. Lots of issues, but he looked at what I was willing to spend, what he wanted to do and we agreed to move forward.

Yeah, he misrepresented a few things, glossed a few problems over, but I knew I got a good deal, he got what he wanted and we both parted generally pleased with the transaction. And the next year, I saw him at OSH in his beautiful new Glassair IV. So is he another "sucker" who took a low-ball offer, or is he a pretty smart guy who closed a deal that got him what he wanted?

You need to be careful when you say "$60k budget". If that is all the money you have to spend for the rest of your life, you should buy a $15k Pietenpol and fly the wings off it. If you understand and can afford the variable expenses, you can look quite a bit up the food chain for $60k.

I almost responded to the "who has taken a low ball offer" earlier in the thread. I guess many people would consider that I too took a low ball offer when I sold my pride and joy. I am living in China for the next couple of years, didn't have anyone I trusted to care and feed for her, the monthly expenses weren't trivial ... it was time for her to go to a new loving owner. I priced her right and sold her in a few months. I took a bit of a beating (bought her in 2004 and put in a 430W), but really can't complain when considering what I hear on this board. I look forward to meeting the guy who bought her ... he got a killer deal. Cosmetics weren't perfect, but she was better equipped that many of the $120k Velocities I see on the market.
 
Ted DuPuis said:
There are also a lot of sellers who really don't want to sell their airplanes, they just like to say they're selling it.

Then you've got the people who are asking more for the airplane because it really is a better product. Go take a look at Jerry Temple's ads for Twin Cessnas and then compare them to the rest of Controller. Yes, Jerry's list prices are higher (although not as much as you'd imagine). A plane he represents is also top notch, and worth the extra cash.
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Snort! I think Bob Gerace's money pit (aka T-310R) was a JT plane.
 
rpadula said:
Snort! I think Bob Gerace's money pit (aka T-310R) was a JT plane.
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There will always be a dissatisfied customer, and Twin Cessnas are money pits in general (ask the man who owns one). Having several friends who've bought planes from Jerry, every one has been very satisfied with the experience.
 
I see and talk shop with Jerry on a frequent basis. Some of his planes are better than others, simply because he's a broker and the usage and maintenance quality varies greatly among the owners he represents. Jerry is very thorough insofar as researching the history and MX status of the planes that he offers, and takes great pains to organize and summarize the information necessary for potential buyers to make an informed decision. He also encourages (almost to the point of insisting) that buyers perform a complete and thorough pre-buy inspection, even with the knowledge that sellers will squeal if any significant issues are discovered, which is often the case.

Jerry is also a stand-up guy. If he misses something or makes a bad call, he eats the cost of making it right for the customer, even if the result is that he stands to lose his entire commission or more on the deal. His position is that he can't expect people to do business with him if they can't rely on what he tells them. Maybe that's why he is among the top brokers in the country in the twin Cessna market that he serves.

Even so, some of the airplanes are going to fare worse than others in the money-pit after they change hands. If anybody knows how to fix that problem, please share it here.


Ted DuPuis said:
There will always be a dissatisfied customer, and Twin Cessnas are money pits in general (ask the man who owns one). Having several friends who've bought planes from Jerry, every one has been very satisfied with the experience.
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N2124v said:
Low ball offers are all part of business. If you get offended by low ball offers in a business transaction, then maybe you should consider removing yourself from the equation and use a broker.
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Bingo.

It always amazes me to read threads like this, decrying the "low-balling" jerks, since later today I will probably be at the airport talking with guys about the "incredibly great deal" they just got on a plane. :D

(And then, later on, I will be dealing with a pilot trying to chisel me down ten bucks on a hotel room. :rolleyes:)

In this market, the only sensible buyers are low ballers. Why would you pay more?

Sent from my Nexus 7
 
Thanks Jay. I didn't know I was supposed to haggle. I thought I was supposed to play the part of the rich pilot;)
 
rpadula said:
I am curious about your post. I haven't been following the 6-seater market lately, so when you say $70k-$80k, is that what you're willing to pay (i.e. the 30% under Vref)? What kinds of models and years are in that price range?
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Essentially, late 70's FG Cherokee 6 with a decent panel, low/mid time engine (for me that means up to 1000 hours) and club seating.

On the other end - that is, retracts - I'll pay as high as 90K for a solid A36 - found one already that would go for that price (1972, engine with less than 400 hours) that fit everything but unfortunately did not have club seating (was not clear from the ad). That's about as much as I can legitimately afford (I mean, sure, I can plunk down a quarter mil, but I won't be able to afford to keep or fly it after that).

I gave up on Lances, seems like they have a lot of issues. The market agrees - Lances go for LESS than the comparable C6 from the same model years, even though they are faster.

206/210's are also an option, but it seems like the owners of those tend to be a lot more protective of their planes' perceived values (they end up selling about midway between prices for Pipers and Bonanzas, but they start higher than Bonanzas and my impression over time is that their owners are crankier and harder to deal with, so I tend to not try as hard).

Yes, I can afford it, yes, I have the cash sitting around. Yes, I'm also picky, because until the time that I actually pay for a plane, I can afford to be.
 
Fearless Tower said:
He may be making assumptions, but Tom is making those assumptions based on a whole lot of years maintaining airplanes for owners. I'd say he probably knows what he is talking about.
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I did assume that 60k was the top of his budget. there was nothing prior to that to make me think differently.
 
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