Should I be scared of airplane ownership

jd21476

jd21476

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jd21476
I am a low time VFR pilot and I currently fly with a local club. I have been looking through the classifieds for a while now and just have never pulled the trigger on buying my own plane due to the fear of the unknown. I have read many reviews on the cost of ownership but it is the unexpected costs or the vague answers about engine reliability and rebuild that gets me. I can get a loan for the plane and I can afford the routine maintenance but the Major Engine Overhaul of $15k to $30k is a tough pill to swallow.

The less expensive, and more within my budget, planes are closer to the Engine Overhaul. They also usually have basic radios and systems.

The club that I currently fly with has some decent C172's and Grumman AG5Bs, both of which I am checked out on. Almost all of the club aircraft have a Garmin 430 or better and I like flying the club aircraft but it is not real practical for extended trips.

The club has a minimum of 1 hour per day for fees so if I fly somewhere for a week and let the plane sit I can pay up to $700 for just letting the plane hang out at the airport. I addition, I work about 100 miles from my house at a military airfield. I have flown a club plane to work before but only if I am turning around and heading back the next day, as to avoid extra fees. If it was my own plane, I could fly all the time and just let is sit at work through out the week.

I still have a year to decide as the military is sending me on a trip for a little while but I know it is something I will be thinking about a lot while I am gone.

For those of you that own planes, can you give me some stories of ownership.....good and bad.
 
The benefits of ownership are obvious. It's awesome for so many reasons. The downside is 1) expense, and 2) the airplane might not fly as much as it should. You can answer 2) for yourself, but figure on hitting 100 hours per year if you can. If you fly much less than that, and you might run into issues with engine corrosion.

For 1) don't kid yourself. The airplane's purchase cost is the least of the expenses. I live in the north-east, I have the plane hangared, and it is well kept. It costs me about 20k per year to own and operate that airplane for maybe 120 hours. A lot of that is the hanger (at $570 per month), and quite a bit of catch up maintenance that was neglected by prior owners. But in my estimation, there's no way it would be less for me than about $15k.
 
In my experience, if you've got a good club with good access at a good price, there's almost no reason to try to buy a plane yourself. You aren't going to be adding much to the equation by doing so except a ton of costs.

Now, clearly there are some pilots who actually do fly 200 hours a year, need their plane at a moments notice, and have the money to own without the financial aspects crushing them. Many of them post on this board.

You need to do an honest assessment of your flying. How much do you fly? How often will you really take trips? How often will your family really go with you? And don't lie to yourself. Most pilots who "think" they are going to take a half dozen trips and fly 200 hours a year actually end up taking one trip and flying 50 hours.

IMO, if you can't write a stress free check for an OH at any point, you are better off not owning. Especially if you already have access to a good flying club.
 
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To me, owning my own plane allows ultimate freedom. Go wherever you want whenever you want. I hope to never be without a plane as long as I can fly. That being said, this ultimate freedom comes at an expense. The amount of that expense varies depending on your mission, what you decide to buy to complete that mission, if you go about buying correctly (patience, pre-purchase, etc) and a certain amount of luck. You for sure need a certain amount of money on hand or disposable income to pump into it. I am happy.
 
As far as stories...I've owned 5 planes over 20+ years (one at a time, not all/any together). I've had $750 annuals, and $18,000 annuals. These planes are old, and parts wear out frequently on even the best of them...and I've never "officially" rebuilt an engine on any of the aircraft I've owned.
My worst single bill for one of my planes was on a Cessna 150 (of all planes, this one was "supposed" to be the cheapest). It ate a starter. Problem is, on a C150, the starter sits on top of the engine, and mine ate the starter RIGHT as the engine started...so the broken gear "ping ponged" all over the engine internals.
Now that's not to say that I haven't had many, many years where I had very few, if any, extra flying expenses. The problem with ownership is, you never know when you'll have a good year or bad. So, at least in my opinion, you always have to have a plan for the bad...doesn't sound like after you take out a loan, you'd have a plan...
But if you do, then go for it. As others above said, owning is awesome too.
 
jd21476 said:
The club has a minimum of 1 hour per day for fees so if I fly somewhere for a week and let the plane sit I can pay up to $700 for just letting the plane hang out at the airport. I addition, I work about 100 miles from my house at a military airfield. I have flown a club plane to work before but only if I am turning around and heading back the next day, as to avoid extra fees. If it was my own plane, I could fly all the time and just let is sit at work through out the week.
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Honestly, this doesn't sound like much of a problem to me (although most clubs don't try to bilk you like that). If work is 100 miles away, you might as well just drive most of the time.

Any other real trip or vacation you take, you'll likely be flying at least 4-5 hours round trip anyway. So over a week, you are on the hook for what? An extra $200 to meet the daily minimum?

That $200 is a drop in the bucket compared to ownership. Basically, if you are concerned about the financial aspects of paying a daily minimum, you sure as heck will be stressed by the costs of ownership.
 
There is a secret to stress free ownership - buy your next major repair when you buy your airplane. Put 15k into an account of some kind, something that is at least semi-liquid so you can get to it. Now for every hour you fly, add $25 to the account. Be honest, the only person you're cheating is your future self. Over the course of a 2000 hour TBO engine (assuming new), you'll save another 50k. And probably spend it too.

Now - when you have the 18k annual or the engine eats a valve, it's not stressful because the money is there.

Still cannot help you if you get the 18k annual AND the engine eats a valve...
 
George Mohr said:
The benefits of ownership are obvious. It's awesome for so many reasons. The downside is 1) expense, and 2) the airplane might not fly as much as it should. You can answer 2) for yourself, but figure on hitting 100 hours per year if you can. If you fly much less than that, and you might run into issues with engine corrosion.

For 1) don't kid yourself. The airplane's purchase cost is the least of the expenses. I live in the north-east, I have the plane hangared, and it is well kept. It costs me about 20k per year to own and operate that airplane for maybe 120 hours. A lot of that is the hanger (at $570 per month), and quite a bit of catch up maintenance that was neglected by prior owners. But in my estimation, there's no way it would be less for me than about $15k.
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Thanks George. When you say corrosion, is that only prevalent cause you live in NJ or is it everywhere? I live in San Diego so it may not be an issue in the Southwest.
 
There are more optimists as first time airplane buyers than realists. And the truth is, it is probably best to be a bit of a pessimist.
 
Bonchie said:
Honestly, this doesn't sound like much of a problem to me (although most clubs don't try to bilk you like that). If work is 100 miles away, you might as well just drive most of the time.

Any other real trip or vacation you take, you'll likely be flying at least 4-5 hours round trip anyway. So over a week, you are on the hook for what? An extra $200 to meet the daily minimum?

That $200 is a drop in the bucket compared to ownership. Basically, if you are concerned about the financial aspects of paying a daily minimum, you sure as heck will be stressed by the costs of ownership.
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I know it sounds like 100 mile sis not a lot but its right through the heart of LA and most of it is on the 405 at rush hour.
 
I have been wrestling with this same question.. Add into the mix minimum aircraft performance. I live in Colorado where my home field is at 5885 AGL and density altitude in the summer can easily hit 9000ft. so an aircraft that will allow me to fly westward means a minimum of 180hp...
In order to afford a slightly newer than old airplane with no more than 1300 hours SMOH, I have thought about partnership/co-ownership and lease-back to my local flight school. The benefit is that the aircraft of co-ownership is obvious.. all cost and expenses are split two or three ways... downside is finding a partner/co-owner I'm comfortable with. Lease backs are good.. the aircraft actually get's flown frequently and minor squawks are taken care of promptly.. in addition, the revenue from the rental of your plane can easily be funneled into an escrow account for the day when you need to do an overhaul. The downside is everyone is flying your plane.. more wear and tear.. and when you want to fly it you have to schedule it just like anyone else.. food for thought..
My search continues..
 
jd21476 said:
Thanks George. When you say corrosion, is that only prevalent cause you live in NJ or is it everywhere? I live in San Diego so it may not be an issue in the Southwest.
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Engine corrosion from dis-use is a problem is most climates (unlike airframe corrosion). The cause is that combustion blow-by contains a lot of water, and that water winds up in the crankcase. If an engine sits for a "long" time, say more than a month (arbitrary timeframe there!), the oil weeps off of the camshaft and other components, leaving them exposed to acidic watery badness, which causes rust. Rust eats camshafts in particular, and because of the Lycoming design with the cam on top of the engine, these are particularly susceptible.

If you fly the airplane often-ish (my goal is every other week), you refresh that oil barrier and happy days. And if you aren't flying at least this much, it seems to me that ownership loses some of its utility anyway.

Solo ownership is amazing and flexible, but expensive. Clubs are great, but rather limiting as you see. The best approach IMO is a small partnership. I did this with a glider for years and loved the benefits. Hard to find the right people though...
 
I like the partnership idea...and I have been looking but like you said finding the right people, and plane at my local airport has been the challenge.
 
Saw a tail of woe from a fellow Mooney owner who did lots of due diligence in his purchase. Had to yank the interior for something and low and behold, spar cap corrosion, the one thing that can kill a Mooney. Yup, the airplanes are old, and ownership can be a dangerous proposition. That said, such tales are in the minority, though tales of aircraft needing very expensive repairs are somewhat more common.
 
Ownership is great most of the time, but then there are times it sucks. In December, I got to unexpectedly buy 2 new batteries ($700) and new tach generator ($300). Then in January I had a cylinder fail 800 miles from home. When it's all said and done, that one cylinder failure is going to cost nearly $5k between parts, labor and transportation to "rescue" the airplane. And then my annual is due at the end of the month. Sometimes the hits just keep coming.
 
Mine has been quite positive, I bought my Archer II in.... 2012-2013ish and so far it's been cheaper than expected. First annual was nearly $3,000, since then they've been right around $1,000 with another $1,500-ish in misc stuff that needs done during the year- batteries, oil changes, misc parts that go bad. My insurance year one was around $1,000, now it's down below $800 for the year. Because I live in the midwest I've been able to get hangars for under $200/mo... note: an available hangar can be hard to find.

So far my story has been very positive, costs have been close to or lower than anticipated. Of course I know that any day it's entirely possible I could have a $30,000 repair to make on a $50,000 airplane... I made peace with that early on and just don't worry about it.

The big pluses to ownership IMO are flexibility... if I want to fly across the country and have the airplane for 2 or more weeks I don't have to worry about schedules or annoying anyone else. Also when I get in my seat is adjusted properly, my switches are where I left them, and nobody has broken anything and quietly put the airplane away in hopes nobody notices. Also since I've already paid the big price I have more incentive to fly as I'm only buying gas and I might as well fly more to get the most out of my investment.
 
bradg33 said:
Ownership is great most of the time, but then there are times it sucks. In December, I got to unexpectedly buy 2 new batteries ($700) and new tach generator ($300). Then in January I had a cylinder fail 800 miles from home. When it's all said and done, that one cylinder failure is going to cost nearly $5k between parts, labor and transportation to "rescue" the airplane. And then my annual is due at the end of the month. Sometimes the hits just keep coming.
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That $5k sounds like a fair price considering...

To the original OP, I should add: when I bought my first plane, I was 26 years old, making $50k a year, with a new mortgage, with exactly the same in my bank account as the price of my first plane (so my account had 0 right after I bought the plane)...in other words, I had no plan if something went wrong. And I owned and loved that first plane for many years...and I got lucky by getting a great flyer that had no unexpected costs (I didn't even have a pre-buy done, ;GASP;!). So basically, I'm saying I ignored the advice I first gave here. BUT, looking back, I realize that I got lucky. VERY lucky.
 
jd21476 said:
I like the partnership idea...and I have been looking but like you said finding the right people, and plane at my local airport has been the challenge.
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my plan is to buy solo, but buy it in an LLC so that I can add co-owners if that makes sense over time without having to sell and reregister the aircraft
 
Figure out how much you will fly a year and be realistic. Come up with a wet rate to cover gas, insurance, hanger, maintenance, engine reserve, prop reserve, loan, etc. and set that aside that amount every 0.1 hour you fly. Be honest, would you really fly it that much more and is your wet rate realistic, not compare it to what you currently pay. If you still think it is worth it after that, go for it. Try to rope someone into a co-ownership so you can reduce your cost. Just for reference, I have personally put off buying because it isn't worth it for what I want versus what I can rent unless I fly a minimum of 100 hours a year, which would make my monthly cost about $850. I am not sure I can part with that much money right now per month, fly that much time a year, or I would accidently buy a lemon plane. Try to get two or three friends into flying so I could hopefully get that monthly cost down to $215 a month. Just make sure you can live without the plane when your buddy is using it.
 
If you want to keep the plane away from home for a week fairly often, you need to own. JMO
 
cowman said:
Mine has been quite positive, I bought my Archer II in.... 2012-2013ish and so far it's been cheaper than expected. First annual was nearly $3,000, since then they've been right around $1,000 with another $1,500-ish in misc stuff that needs done during the year- batteries, oil changes, misc parts that go bad. My insurance year one was around $1,000, now it's down below $800 for the year. Because I live in the midwest I've been able to get hangars for under $200/mo... note: an available hangar can be hard to find.

So far my story has been very positive, costs have been close to or lower than anticipated. Of course I know that any day it's entirely possible I could have a $30,000 repair to make on a $50,000 airplane... I made peace with that early on and just don't worry about it.

The big pluses to ownership IMO are flexibility... if I want to fly across the country and have the airplane for 2 or more weeks I don't have to worry about schedules or annoying anyone else. Also when I get in my seat is adjusted properly, my switches are where I left them, and nobody has broken anything and quietly put the airplane away in hopes nobody notices. Also since I've already paid the big price I have more incentive to fly as I'm only buying gas and I might as well fly more to get the most out of my investment.
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This is exactly what I wanted to hear.
 
I am also thinking about buying the plane myself and then looking for partners as opposed to looking to buy into a partnership. This way I get the plane I want at the airport that I want.
 
Only a fool buys a plane without fear.

I'm in the middle of an engine overhaul that's costing me 133% of the original purchase price. I believe I got the plane so cheap that it's raising the value of my plane by nearly as much as I'm putting into it though.
 
Too bad people don't just give away planes that need a rebuild. i mean if the plane with the rebuild is worth $20k and the rebuild is $20k...shouldn't the plane be free at that point?

I still see people wanting $10k to $15k for these.
 
I dont own a plane but I know a couple of people who do. If you are going to use it a lot I would definitely look into it but also look into other factors like paying for gas, if your plane gets damaged by a storm while sitting in the hangar or something depending on where you live. And if your plane gets totaled you would be in the hole even more. However if you REALLY want that plane then get it man, nobody's stopping you. Follow your dreams because you only live once so you should make every second and chance count :)
 
MIFlyer said:
my plan is to buy solo, but buy it in an LLC so that I can add co-owners if that makes sense over time without having to sell and reregister the aircraft
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Be careful. FAA implications.
 
When buying an airplane remember that the cost of maintenance and repairs will be proportional to what the airplane would cost if it were new. Also, hangar rent can be substantial, depending on where you live.
 
LDJones said:
Having done this, what are the FAA implications? I can’t think of any off the top of my head.
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I thought it was cut and dried, and in fact formed an LLC myself earlier last year for just such an eventuality, but I've learned recently that depending on how it's operated, piloted, and paid for (in terms of ops), the FAA might (and has) look at it as if it's an illegal Part 135 (aka 134.5).
 
Buy a newer experimental (or build your own) and stop living in fear of high mx costs of certificated aircraft. I wish someone had told me this years ago and that I had taken their advice.
 
paflyer said:
I thought it was cut and dried, and in fact formed an LLC myself earlier last year for just such an eventuality, but I've learned recently that depending on how it's operated, piloted, and paid for (in terms of ops), the FAA might (and has) look at it as if it's an illegal Part 135 (aka 134.5).
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Well, you can run afoul of the FAA by breaking the rules regardless of ownership style. But I’ve never seen a corporate ownership in and of itself lead to questions. Now if you take a person into your LLC and start flying him around for compensation, that’s going to get you in hot water regardless of the LLC.
 
I bought my first plane with less than 20 hours in my log book. The 1600 hour PA28-180 was supposed to allow me to build some time and flip it to buy my long term plane within a couple years. With around 35 hours in my log book I was in the middle of a MOH. My wallet took quite an unexpected and significant hit. I'm still happily married and am a proud owner of a PA-32 currently.

Yes, you have to be able to absorb some unexpected expenses when they pop up. They can be big. However, at the end of the day its very difficult to put a "life value" on being an owner/pilot. If you have enough disposable income to make it possible then I say go for it. People don't buy fancy boats, sports cars, and other nice "toys" because it makes economical sense. Why do people try to do that with planes? For whatever reason people focus on the value of the utility of the plane. That's a terrible idea for GA. Any utility is a bonus. This is all about fun, enjoyment, doing something challenging and satisfying, making memories, etc.
 
Buying gives you freedom and will be cheaper as you get above 100hrs/yr, but are horrendously expensive if you’re going to only be flying 20 hrs/yr.
Buying also allows you to make the airplane your own: avionics, interior colors etc.
Otherwise Rentals are cheaper.
 
Why do people by boats? They are used in most parts of the country
LDJones said:
That’s a completely different animal when you’re having the LLC employing pilots. Way beyond a few guys owning and flying an airplane held in an LLC.

As I said, there are many ways to run afoul of the FAA regardless of the form of ownership.
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How about if you sporadically employ a CFI, or a mentor pilot?
 
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