Buying prices

[Tom-D]

How do you determine what the aircraft is worth?

 

[EdFred]

What I'm willing to pay for it.

 

[Henning]

How do you determine what the aircraft is worth?

By the value of what it does for me. An airplane is just a tool, a tool is worth what it does for you.

 

[steingar]

I try and find out what other similar aircraft are selling for, if possible.

 

[N801BH]

Whatever the market can bear...........

 

[Tom-D]

By the value of what it does for me. An airplane is just a tool, a tool is worth what it does for you.

Some are toys..

How did you determine the price you'd pay for the 310?

 

[Tom-D]

What I'm willing to pay for it.

What factors are part of that decision?

 

[EdFred]

What factors are part of that decision?

How much I have in my pocket.

 

[James331]

Whatever the market can bear...........

Exactly.

Just like anything else, from a bicycle to real estate.

Look at comps, put in a price, see what happens.

 

[JOhnH]

I start with a budget and look at all the planes that fit my wish list. If I can't find any acceptable in my price range I will increase my budget. If I find a bunch that satisfy both, I tighten up the criteria.

 

[Henning]

Some are toys..

How did you determine the price you'd pay for the 310?

By the condition of the plane and what the owner set. He set a price, I looked at the plane, I paid the price, it was worth much more in condition vs what anything else on the market was that could do the same job for me, that was even after doing the panel. A lot of work had been done to the plane, $220k in receipts, everything every old 310 always needs, plus engines and props, she was basically new needing some dry seals replaced and a new panel.

 

[Tom-D]

I start with a budget and look at all the planes that fit my wish list. If I can't find any acceptable in my price range I will increase my budget. If I find a bunch that satisfy both, I tighten up the criteria.

How does that effect what you will pay for a certain aircraft?

 

[Henning]

Even as a toy though, the airplane is still a tool, a tool of recreation rather than occupation is all.

 

[Tom-D]

Even as a toy though, the airplane is still a tool, a tool of recreation rather than occupation is all.

Don't quibble over what the aircraft is used for or you'll be off on a tangent again. Just tell us what factors you use to determine the buying price of aircraft.

 

[Henning]

Don't quibble over what the aircraft is used for or you'll be off on a tangent again. Just tell us what factors you use to determine the buying price of aircraft.

Already did. Every deal is different.

 

[N747JB]

I study the market, see what is selling vs what is sitting, I do the same thing buying or selling. If I am selling I look at similar ones on the market, see how they are priced and if they are selling. When I sold my 421, I saw one almost identical that had been sold recently, I called the broker, he told me what it sold for and that he may have a buyer for mine that looked at the one he sold. I ended up selling it to a friend, who later sold it to the broker's buyer. When I bought my 182, I had already been watching the 182 market for a couple years, I had a pretty good idea of what was selling and found one not advertised and made an offer.

 

[JoseCuervo]

The value to me for buying, is $1 less than the lowest price EXACTLY similar aircraft for sale. There is no reason to pay more for the SAME plane.

That being said, since we cant find EXACT substitutes for condition on 50 year old planes (hours, paint, logs, damage history, etc), we then start adding/subtracting from other known planes.

I know when I bought mine, I had a $15k range +/- that defined the "range" of prices I was willing to pay. I then looked and called on as many 182's as I could in my range, +$20k. Talked to sellers.

I would go back a month or two and call ones that weren't listed on Trade A Plane anymore, and find out some of those sold. "If you don't mind, would you share with me what it sold for?" got me pricing on ACTUAL sales (assuming I wasn't lied to) on a handful of planes.

The ACTUAL sales let me know where the market price was to give me a base price to adjust on other planes, plus/minus.

The planes from 3 months ago that were NOT sold let me know they were too high priced, for the condition.

Essentially, I created my own "Blue Book" of prices for 1956-1970's C182s, with 10-20-30 data points.

There are planes 18 months later still running the same advertisement on Craigslist "New to Market, C182x with 1100 hours smoh" that were listed 18 months ago. (This particular plane in Washington has hail damage and was repaired with Bondo.) Another one in Nebraska still is listed at a "good price", from a seller who rejected my "would you consider $xxx?" that is actually higher than his currently listed price.

There is one in Nevada that has a horrible color paint job (purple) that is about $12k more than I wanted to pay, has a 3-bladed prop.


The one kicker in my method was there were certain items that sellers valued that did not have the value for me, hence I would not give an upward adjustment for upgrades that I didn't care about.


I do not believe I can use the "value to me as a tool" method value a plane. The value it provides to me has NOTHING to do with the current market value of the plane. And, at the end, the only "value" is the LOWEST price the seller will take being equal to the HIGHEST price the buyer will pay.

 

[Theboys]

I decide what I want in the plane. Avionics, engine, paint and interior. If all that is fairly new I figure what it would cost me to bring the average plane to that level. I don't look for cheap.

 

[frfly172]

If the buyer think he got a good deal,then it is a good deal to him. I decide what I want in the aircraft,and what I would be willing to pay to upgrade the aircraft. Then I do some comps to see if I'm in the ballpark,then I'm happy.

 

[Unit74]

Problem with Vref, is its rediculously unreliable. I had my plane evaled recently and was told there was no value given for upgrades over stock. Dig egt/cht, dig tach, speed mods, etc... What's even funnier, or sad spending on how you look at it, I was told the brand new Garmin GDL88 was only worth about half of what it was installed 6 months later.

I understand there is no such the as a return on installed equip, but C'mon man, seriously?

My point is this....

You can take two planes side by side and try to value them, but realistically, the plane is worth what the buyer is willing to pay for. If the seller knows what he has, and the buyer doesn't understand the equipment list, the buyers balk at the higher price and call it unrealistic. The inverse is true as well, but usually uncommon unless it's an estate sale.

I paid $8k over Vref for my Archer, because I knew what I was looking at. I coulda bought one at Vref, but I'd spend $20k to bring it up to the same as mine now. I can see the value, but many times financiers and brokers cannot. In the first year I have owned it, I have dumped just over $20k into it. Don't expect a return of that, but I'm also not going to let someone say it only Vrefs at this, so here is my offer at Vref.

 

[Henning]

Problem with Vref, is its rediculously unreliable. I had my plane evaled recently and was told there was no value given for upgrades over stock. Dig egt/cht, dig tach, speed mods, etc... What's even funnier, or sad spending on how you look at it, I was told the brand new Garmin GDL88 was only worth about half of what it was installed 6 months later.

I understand there is no such the as a return on installed equip, but C'mon man, seriously?

My point is this....

You can take two planes side by side and try to value them, but realistically, the plane is worth what the buyer is willing to pay for. If the seller knows what he has, and the buyer doesn't understand the equipment list, the buyers balk at the higher price and call it unrealistic. The inverse is true as well, but usually uncommon unless it's an estate sale.

I paid $8k over Vref for my Archer, because I knew what I was looking at. I coulda bought one at Vref, but I'd spend $20k to bring it up to the same as mine now. I can see the value, but many times financiers and brokers cannot. In the first year I have owned it, I have dumped just over $20k into it. Don't expect a return of that, but I'm also not going to let someone say it only Vrefs at this, so here is my offer at Vref.

"The Market" proved that a G-500 and a 430w have no added resale value when installed.

 

[Unit74]

I decide what I want in the plane. Avionics, engine, paint and interior. If all that is fairly new I figure what it would cost me to bring the average plane to that level. I don't look for cheap.

It's pretty easy to spot the nickel and dime planes over the pampered ones. If the equipment list can stand on its own, it's worth looking at. If they want to list a bunch of BS about why it's a great plane with the same **** it came out of the factory with, time to keep moving.

 

[Unit74]

"The Market" proved that a G-500 and a 430w have no added resale value when installed.

I know, right? How insane is that..... In a 4 place, those two items are worth more than the entire hull.


But they have no really value, right?

 

[Henning]

I decide what I want in the plane. Avionics, engine, paint and interior. If all that is fairly new I figure what it would cost me to bring the average plane to that level. I don't look for cheap.

Wow, your list missed the most critical thing, Airframe. If it doesn't have a clean airframe, the deal is a loser unless you are buying it as a donor plane for the rest of the stuff. Airframe repair costs are not only really expensive and time consuming, they reduce the resale value of the plane for having been done. Most inexpensive planes, airframe repairs, even moderate corrosion remediation, is not economically viable, you can replace the airframe cheaper.

 

[N747JB]

"The Market" proved that a G-500 and a 430w have no added resale value when installed.

I disagree, they add to the value of one airplane compared to another similar one with a 6-pack and a couple KX170's. Do they add the installed cost? Nope. But all things being equal, the better avionics packages sell for more money in most airplanes. A G500 and a GTN 650, wouldn't help an old beater 150, but it's great in a 182 or a 210. It depends on the market for the airplane, your old 310 is a bad example, most of those old birds are flown by old guys or are used for building time, not a good market for a glass panel. The old guys are still flying the airplane they bought in 1985 and the time builders want cheap multi time.

 

[Henning]

I disagree, they add to the value of one airplane compared to another similar one with a 6-pack and a couple KX170's. Do they add the installed cost? Nope. But all things being equal, the better avionics packages sell for more money in most airplanes. A G500 and a GTN 650, wouldn't help an old beater 150, but it's great in a 182 or a 210. It depends on the market for the airplane, your old 310 is a bad example, most of those old birds are flown by old guys or are used for building time, not a good market for a glass panel. The old guys are still flying the airplane they bought in 1985 and the time builders want cheap multi time.

Yeah, I guess, it all worked out in the end. I still think if you are keeping the plane and flying it, what the increase in information gets you still makes it worth it regardless what you put it in if you fly IFR in it.

 

[Tom-D]

Wow, your list missed the most critical thing, Airframe. If it doesn't have a clean airframe, the deal is a loser unless you are buying it as a donor plane for the rest of the stuff. Airframe repair costs are not only really expensive and time consuming, they reduce the resale value of the plane for having been done. Most inexpensive planes, airframe repairs, even moderate corrosion remediation, is not economically viable, you can replace the airframe cheaper.

This is true. I'll take a nasty looking bad paint, cloudy windows, and old engine anyday when the aircraft has a clean shiney interior. all that other stuff can be fixed. corrosion can't.

This nasty looking aircraft sold for 5k, no one could see the nice no corrosion interior

 

[Henning]

This is true. I'll take a nasty looking bad paint, cloudy windows, and old engine anyday when the aircraft has a clean shiney interior. all that other stuff can be fixed. corrosion can't.

This nasty looking aircraft sold for 5k, no one could see the nice no corrosion interior

Yep, I had the opposite example. I went and picked up a 170 with fresh engine, paint and interior a guy on the field in TX had bought in FL and we were supposed to start the annual right away. When we opened it up when I got back, there was so much corrosion, the plane got condemned basically. Al just ended up finding him a replacement airframe and we swapped all the new goodies onto it.

 

[Tom-D]

Knowing the selling prices of the equipment is the key to knowing how to place value on anything. When I looked at the 5k 170, I knew the crank was worth 5k, the cases another 5k, So I knew I couldn't get hurt anyway it turned out.

So what is a pre-buy worth? It ain't worth squat, if YOU are not familiar with the type and what they sell for.

Who do you trust with your money? Some Shmoo who has no dog in the fight?