Old airplane resale values

Groundpounder

Groundpounder

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Emerson Bigguns
Looking into buying an airplane that was built in 1962. It has been completely modernized, glass cockpit, new paint and interior, low time engine and prop, etc etc. Because of its aftermarket mods, the asking price is about $20k over anything Vref or ABB will come up with. A friend of mine said "don't buy that airplane, you'll never get your money back on it!!!". Any truth to that assertion? Its a very popular type, with plenty of demand.
 
Let's say you found a plane that had tired interior, paint, panel, engine time, etc for a below average price. Are you the type of person that would want to refresh it all? Also, would you be happy flying it if everything was just average in terms of age and condition?
 
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Just my limited experience and everyone will say I’m a fool but I’ve felt that getting a plane at VRef was the definition of a good value. If a plane is nice... I don’t know if vref tends to reflect that info well. At the end of the day everything is worth what its purchaser will pay for it. Is it worth it to you? I paid more than I’d have liked for a PA32-300 in some ways, but looking online anything that was listed was even more expensive vs. VREF... its all supply and demand.
 
gov98 said:
Just my limited experience and everyone will say I’m a fool but I’ve felt that getting a plane at VRef was the definition of a good value. If a plane is nice... I don’t know if vref tends to reflect that info well. At the end of the day everything is worth what its purchaser will pay for it. Is it worth it to you? I paid more than I’d have liked for a PA32-300 in some ways, but looking online anything that was listed was even more expensive vs. VREF... its all supply and demand.
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I agree with the supply and demand thing. Also, if you wanted an airplane that is 10-15 years newer than the one we are looking at, you'd have to pay at least $25k more from what I am seeing, and there weren't a lot of changes between the model years.

Buying an airplane is a pain in the ass.....
 
Groundpounder said:
Looking into buying an airplane that was built in 1962. It has been completely modernized, glass cockpit, new paint and interior, low time engine and prop, etc etc. Because of its aftermarket mods, the asking price is about $20k over anything Vref or ABB will come up with. A friend of mine said "don't buy that airplane, you'll never get your money back on it!!!". Any truth to that assertion? Its a very popular type, with plenty of demand.
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If that work was done well the person that isn't getting their money back on it is the seller.
What you will get out of it will depend on a lot of factors, some of which aren't in your control, at the time you sell (such as the general state of the economy, which does influence the price of discretionary toys like airplanes).
 
Groundpounder said:
I agree with the supply and demand thing. Also, if you wanted an airplane that is 10-15 years newer than the one we are looking at, you'd have to pay at least $25k more from what I am seeing, and there weren't a lot of changes between the model years.

Buying an airplane is a pain in the ass.....
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Vref is a guideline. The problem now is so many airplanes are unique, almost one-of-a-kind because of the nature of upgrades. How does a publication value them?

So yes, it is a PITA. Unlike shopping for a used car where there's lots of similar ones to choose from, and all that matters is mileage, price and color. :)
 
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If you don't have a lot of expertise, find someone who does and I'm not talking the typical, "Get a pre-buy" but someone who knows the Make and Model well, if you don't... To help guage if its even worth a pre-buy. I had an angel on my shoulder buying my C-140, a gentleman whos been flying the C-120 (basically exact plane if you aren't familiar with them minus flaps) that his dad bought in the 60s and he knows them inside and out, he helped me eliminate a lot of pitfalls right from the get go before even going to look at any...
 
GRG55 said:
If that work was done well the person that isn't getting their money back on it is the seller.
What you will get out of it will depend on a lot of factors, some of which aren't in your control, at the time you sell (such as the general state of the economy, which does influence the price of discretionary toys like airplanes).
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+1 to this.

Groundpounder said:
Looking into buying an airplane that was built in 1962. It has been completely modernized, glass cockpit, new paint and interior, low time engine and prop, etc etc. Because of its aftermarket mods, the asking price is about $20k over anything Vref or ABB will come up with. A friend of mine said "don't buy that airplane, you'll never get your money back on it!!!". Any truth to that assertion? Its a very popular type, with plenty of demand.
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Usually planes upgraded to this level are hard to find in my opinion. I think a plane upgraded with glass w/ newer interior is going to sell much quicker than one with old outdated avionics, paint and interior even if the price reflects that.. I rather buy the already upgraded plane.. Maybe it's just my personality... I much rather buy a house that has had recent bathroom/kitchen/flooring etc remodels vs a fixer upper at a cheap price. Who wants to do all the work and put up with the ******** that comes along with it? Another thing to think about... a plane that has had all that money thrown at it in the last few years for upgrades has probably been very meticulously maintained and the owner most likely spared no expense. Just my 2 cents.. what type of make and model are you talking about here?? Post the link for us to see!
 
Sounds like a bargain compared with doing it yourself...if its a popular model it will only become more valuable.
 
Tom-D said:
Pay what you believe the aircraft is worth to you. then fly and have fun and never look back.
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...until the first annual. :D
 
I bought a Piper Archer that fits that description. I jokingly say I bought a bunch of Avionics and got plane for free. I have all the receipts from the prior owner, and I'm not that far off. I'm 62, just got my PP in July and don't expect to buy another plane and frankly don't care what it's worth from a resale standpoint. I hope to fly at least until I'm 80, so almost 20 years. I'll have gotten what I paid for it in fun, time saved in getting places and stuff that I value.
 
I'd hold off 6 months. The bottom is about to fall out. GM just laid off a ton of people right on the holidays, more to follow imo, in 1CY19. This is in line with my prediction of a recession by 4CY19. Most people creating pressure on single pricing are the financed crowd; these will be the first to get reclama when that "consumer confidence" evaporates like a fart in the wind. Buy now, and you're buying at the top of the market imo.
 
Plane I bought was worth about $70-75k in for the low hours, total time rent only 400 hours SMOH.

However I paid $92k. Why? 2 months before I bought it the owner spent $70k in avionics and body mods.
 
Lots to factor, also 62 isn’t a old plane
 
What model are you looking at? Get a pre- buy inspection from someone who knows the type. Good luck..:)
 
pigpenracing said:
I disagree... I love buying airplanes. To me it is fun and not a pain at all.
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You messed up the quote, that and fact you like buying airplanes tells me you’re insane. ;-)
I bought 1 plane, my forever plane, and I used a buying broker to looked at planes, cost of broker saved me in travel costs.
If you like buying planes so much, maybe you should become a broker.
 
The age of an airplane has little to do with it's value unless you are talking near new. The more important factor is condition, equipment, and total time. I've seen 200k Navions and 25K navions for sale that were both airworthy and both eventually sold. Buy the plane that stirs your soul and fits your mission. If it's worth the premium to you that is all that matters.
 
AnthonyS1 said:
+1 to this.



Usually planes upgraded to this level are hard to find in my opinion. I think a plane upgraded with glass w/ newer interior is going to sell much quicker than one with old outdated avionics, paint and interior even if the price reflects that.. I rather buy the already upgraded plane.. Maybe it's just my personality... I much rather buy a house that has had recent bathroom/kitchen/flooring etc remodels vs a fixer upper at a cheap price. Who wants to do all the work and put up with the ******** that comes along with it? Another thing to think about... a plane that has had all that money thrown at it in the last few years for upgrades has probably been very meticulously maintained and the owner most likely spared no expense. Just my 2 cents.. what type of make and model are you talking about here?? Post the link for us to see!
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It's a 182. Not going to post the link.

hindsight2020 said:
I'd hold off 6 months. The bottom is about to fall out. GM just laid off a ton of people right on the holidays, more to follow imo, in 1CY19. This is in line with my prediction of a recession by 4CY19. Most people creating pressure on single pricing are the financed crowd; these will be the first to get reclama when that "consumer confidence" evaporates like a fart in the wind. Buy now, and you're buying at the top of the market imo.
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That is something that has crossed my mind, although someone I know in the little airplane business says the top of the market is coming next year. Either way, we're close to it right now.
 
Are you buying the plane just to sell it? If you're not, you do realize you are worried about selling a plane you haven't bought yet...just saying.
 
tawood said:
Are you buying the plane just to sell it? If you're not, you do realize you are worried about selling a plane you haven't bought yet...just saying.
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No, but if life happens and we have to sell it in a year, I don't want to be horribly upside down.
 
No one ever made a profit by investing in a personal airplane. (or even broke even - and as a plane owner for over 50 years I can prove it)
The market value of the plane is exactly what the buyer and the seller arrive at (shrug).
'Wait for next year', they cry. If it is a nice plane, it likely won't be there next year - and if it is, who says the seller will accept even one penny less than right now?

Having said the above:
Now for stocks, I would wait a year - give or take. I expect a correction in the market. But, owning a stock is a vastly different decision than an airplane and made for vastly different reasons...
For farm land I am waiting a year or two. When the market corrects, a fair sized chunk of the money currently parked in farm land for safe keeping will be pulled out to grab up cheap stocks. I will be there to pick up some cheap(er) farm land.
There are dividend paying stocks out there with long track records and returning 3.5% to 4% (my holdings return 4.1%) If you have or can rustle up a $100K for dividend yielding stocks in place of an airplane you will have $4,000 a year coming in. That will pay for a chunk of a 100 hours of annual flying time from the local FBO. Just sayin'....
 
Groundpounder said:
Looking into buying an airplane that was built in 1962. It has been completely modernized, glass cockpit, new paint and interior, low time engine and prop, etc etc.
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But. Has the airframe been gone through thoroughly? I have encountered too many airplanes with nice new interiors and paint, but the control cables are corroded and shot, pulleys seized, cracks in various structural parts, fuel lines shot: the stuff nobody sees because nobody's been looking for it. There are some potentially expensive fixes in beautiful airplanes. Get a good, thorough prebuy. That airplane is 56 years old, remember. That's plenty of time for defects to accumulate.
 
Dr. O said:
No one ever made a profit by investing in a personal airplane. (or even broke even - and as a plane owner for over 50 years I can prove it)
The market value of the plane is exactly what the buyer and the seller arrive at (shrug).
'Wait for next year', they cry. If it is a nice plane, it likely won't be there next year - and if it is, who says the seller will accept even one penny less than right now?

Having said the above:
Now for stocks, I would wait a year - give or take. I expect a correction in the market. But, owning a stock is a vastly different decision than an airplane and made for vastly different reasons...
For farm land I am waiting a year or two. When the market corrects, a fair sized chunk of the money currently parked in farm land for safe keeping will be pulled out to grab up cheap stocks. I will be there to pick up some cheap(er) farm land.
There are dividend paying stocks out there with long track records and returning 3.5% to 4% (my holdings return 4.1%) If you have or can rustle up a $100K for dividend yielding stocks in place of an airplane you will have $4,000 a year coming in. That will pay for a chunk of a 100 hours of annual flying time from the local FBO. Just sayin'....
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This isn't about investing, this is about inventory and desperation. The point you're missing is that when the market is down, people unload their toys first. As such, I have a high level of confidence that the inventory in a down cycle is considerably better than the inventory we see today, especially considering all the financed dodo birds out there. Today all you have out there is absolute junk that people can peddle for a premium. When the bottom falls out next year you will see more cherries at a discount. That's all I'm saying. I certainly did not suggest that an airplane is an investment.

If everybody bought airplanes like me then sure, your point about inelastic inventory would be accurate. But that isn't the market, never will be. Americans can't help themselves when it comes to financing their lives to their detriment; I just play my part in this ecosystem as a bird of scavenge. Dont shoot the messenger, or the turkey vulture in this instance. :D
 
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teejayevans said:
You messed up the quote, that and fact you like buying airplanes tells me you’re insane. ;-)
I bought 1 plane, my forever plane, and I used a buying broker to looked at planes, cost of broker saved me in travel costs.
If you like buying planes so much, maybe you should become a broker.
Click to expand...

I have bought over 30 airplanes. I own 5 now. It is a blast. Most the planes I buy are Aerobatic biplanes. We just picked up a Stearman :)
The goal is to get time in every airplane made. Lol
 
Groundpounder said:
Looking into buying an airplane that was built in 1962. It has been completely modernized, glass cockpit, new paint and interior, low time engine and prop, etc etc. Because of its aftermarket mods, the asking price is about $20k over anything Vref or ABB will come up with. A friend of mine said "don't buy that airplane, you'll never get your money back on it!!!". Any truth to that assertion? Its a very popular type, with plenty of demand.
Click to expand...

As a rule, you will never break even on avionics, so that is what I would focus on for this decision. Look at the avionics upgrade and compare it to a similar plane without them. The look at the cost of upgrading the second plane to the avionics stack you want. If the upgraded plane has all the avionics you want and cost less than a basic 182 + the avionics you want. I would go with the upgraded plane and enjoy flying knowing that, even if I did not save money, I was able to fly for the 3 months while the plane would have been in the avionics shop.

But keep in mind, even if you need to buy a plane, the avionics are a separate discretionary purchase. If it is 182 with a Garmin G1000 system and a $20K premium, then it will be a better deal than a $20K cheaper 182 that you plan to install a pair of GNS-GPSes into for hard IFR, but it is a horrible waste of money if you are a VFR pilot looking at 182s with minimal instruments for $30K less, because, in addition to spending the 20K on avionics, you will also have to pay to maintain the system and update the databases and that adds up over time.
 
if your happy with the price you paid ,then that was the right price.If its the airplane you want go for it. Vref is only a reference.
 
Life happens. True. But u don’t know what will happen, may be you will fly her for 10 years, may be 1 month. If you can afford it, and like it, buy. Rest is just noise. This hobby is about spending money in various ways and then some. Bw no matter how well it was maintained, it can blow something tomorrow morning and you are up for a 20-30k overhaul
 
WannFly said:
. Bw no matter how well it was maintained, it can blow something tomorrow morning and you are up for a 20-30k overhaul
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Median outcome much? This is hyperbole. The insinuation here being that if you're not capable of handling the swings of replacing the entire hull value of the airplane on command you are not in a position to own. An oft proferred, and tired utterance that doesn't resemble the statistically median outcomes of those of us who have owned airplanes of varying makes and conditions. All it does is scare the uninitiated and support the trope that only those for whom money is not an object can legitimately participate in the sole ownership game.

There's a lot of shades between boutique pricing firewall forward replacement, and staring at a hangar ornament with wings. It's not this binary fallacy at all. Cults exist in maintenance circles in order to justify their labor rates, just like cults exist in pricing when it comes to airplane buying. 30 k is certainly not the floor when it comes to a comprehensive engine repair that somehow is also zero percent insurable. Some of you people wouldn't know the concept of field overhauld, let alone IRAN, If it punched yall's mother in the nether region.:D
 
I don’t place lots of value in VRef. It’s all about the prebuy. VRef can say $200,000, then I see $60,000 of open items. Deferred maintenance, corrosion, gear-up not repaired correctly, motor issues, avionics one flight away from going t-up, etc. Many, many birds flying have deferred maintenance issue of some kind.

Use as a starting point only. Then negotiate based on pre-buy.

Always love older low-time birds where owners don’t fly them much but think they are worth top dollar. Only to find corrosion everywhere, and that 1,000 hour motor is toast.
 
hindsight2020 said:
I'd hold off 6 months. The bottom is about to fall out. GM just laid off a ton of people right on the holidays, more to follow imo, in 1CY19. This is in line with my prediction of a recession by 4CY19. Most people creating pressure on single pricing are the financed crowd; these will be the first to get reclama when that "consumer confidence" evaporates like a fart in the wind. Buy now, and you're buying at the top of the market imo.
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Yeah, those GM assembly workers are all going to be dumping their aircraft right after New Years! :confused:
 
pigpenracing said:
View attachment 69547

I have bought over 30 airplanes. I own 5 now. It is a blast. Most the planes I buy are Aerobatic biplanes. We just picked up a Stearman :)
The goal is to get time in every airplane made. Lol
Click to expand...

I'm guessing you're in a much different financial situation than I am, and I need to be a lot more careful what I drop $100k on.
 
When I purchased last year (also a 182) I looked at both "modernized" aircraft as well as "outdated" aircraft and I had a relatively modest budget for a 182. In the end, I found the best deal in an aircraft that had a great airframe and modest interior, but engine was <200 hours from TBO and avionics didn't meet my requirements in any way.

Did I spend more on it? Who knows - prices are always all over the place.

The better question is, do I have exactly what I want? Definitely. And I smile every day I fly it. It [now] has exactly the equipment I wanted, and I found a great shop that was very kind to help me find refurbished avionics that fit within my budget.

As a professional seller, the only answer that matters is, "it's worth what someone will pay for it."
 
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