VREF price

brien23

brien23

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With the estimate of 20 to 30% unemployed by Sep how long does it take for VREF to reflect the value of GA aircraft. If people are thinking six months ahead do you sell now or wait to see what happens.
 
If you’re not flying the plane I’d sell now. You still have ongoing expenses: hangar/tiedown, insurance and planes that don’t fly are less desirable than those that do.
It took a long time for prices to hit bottom last recession, IIRC ~2014 was the low water mark in used plane market.
 
brien23 said:
With the estimate of 20 to 30% unemployed by Sep how long does it take for VREF to reflect the value of GA aircraft. If people are thinking six months ahead do you sell now or wait to see what happens.
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Kind of depends on how many of the unemployed are aircraft owners. I'd imagine it's probably a much lower percentage of unemployed population, given that most of the unemployed (at this point) are front-line hourly staff. If the market continues to tank after July/August, I'd think you could see some Vref impact, but I don't think that many call center operators and mall attendants are likely aircraft owners. It might be a tough market to sell right now since many are going to hold onto cash since the future job market has a lot of volatility.
 
if their projection is even 50% right, then we are heading towards complete poo hit the fan phase by fall. spending on toys is usually the first thing to go
 
VREF takes a little time to adjust to market changes. Pilots are a different breed ,they will keep their aircraft until the end.
 
I would sell now before the V Ref starts to go down. Sell to those guys looking to buy. My dad favorite saying was “a guy can go broke buying ‘good deals’ just as easily as buying ‘bad deals’. Once you decide to get out, get out.
 
What are you trying to sell? If it's a Warrior II let me know. :) Hoping prices will drop, but not betting on it unless there's a corona-widow or two trying to sell the deceased's plane.
 
Half Fast said:
What are you trying to sell? If it's a Warrior II let me know. :) Hoping prices will drop, but not betting on it unless there's a corona-widow or two trying to sell the deceased's plane.
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I hear a warrior or archer is. Ow more expensive than arrow, much more
 
they need to pry(the yoke) off my dead hands...
 
I have feeling planes like a 152, 172, later year Cherokee, Tomahawk, Beech Skipper, Sport, and Sundowner will hold some value as they are currently being snatched up for training purposes.

A friend bought a Beech Sport a few months back and realized he didn't like it and sold it in a week for a little more than what he had into it.

Everything else, this may get interesting.
 
The problem is that much like housing, people fixate on past price. Which is to say if they saw people buying at one amount and have adjusted their perspective so that their bird is worth that, then that's what they'll want. The amount of deals completed will go down and only then will a price picture emerge.

That said, this assumes there will be another correction. I assume, as a buyer, that is not what's going to happen for a long time.
 
Prices will come down, but it’ll take a while.
 
brien23 said:
how long does it take for VREF to reflect the value of GA aircraft.
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I don't know about VREF, but I can tell you what happened with selling prices of Cirruses in the years following the 2008 bust. Because I was shopping then.

Even though some asset prices hit bottom in early 2009 (stock market bottomed out then, and thence began a steady climb), Cirrus prices did not start climbing until about 2013.

One factor was repossessions. Lots of Cirruses had been bought for personal use by business owners, who mostly took out loans to make their purchase. When their biz went sour, these owners quit flying and deferred maintenance, but kept on making loan payments until they just couldn't any more, which happened until about 2013. Then the bank repossessed, and sold the plane onto a market that didn't have a lot of buyers at that point. That's what I was told by a banker, who made airplane loans, and who tried to sell me a repossessed Cirrus.

So, to answer your question, it might take a few years, before prices start climbing again, if it's anything like 2008.
 
If I was going to sell my C172 or Be35J I would do it now since I do not expect prices to improve for a couple years after we get thru the crisis, ie stock market over 28,000. I will maintain both, when one poops out, I will switch to the other and salvage the broken one. When both poop out, good bye flying. I’m 73 and see the light at the end of the tunnel, oh I guess it’s a train, well it’s been a fun 55 yrs.
 
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