How much will airplane prices drop in 2020?

Discussion in 'Flight Following' started by Adrien, May 1, 2020.

  1. Adrien

    Adrien Filing Flight Plan

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    If you are in the market for a general aviation airplane, with the current COVID crisis and staggering unemployment rate, it is not unreasonable to think that some people would attempt to cut expenses and get rid of their airplanes. This may lead to an increase in supply vs demand with a subsecuent decrease in prices.
    The question is, how much did the prices in general dropped during 2008 crisis?
    I was not in the market for an airplane back then so I never bothered to check.
    For those of you who were around, what percentage in drop do you anticipate in this upcoming downturn?
    I know that its imposible to time the market but I want to get an idea of the GA market swings. (10-20% drop vs 30-50% price drip?) Im specifically talking about single/twin piston aircraft. My personal interest is in a P210 (vs PA46).
     
  2. forsonsinc

    forsonsinc Pre-Flight

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    Might increase
     
  3. Warmi

    Warmi Pre-takeoff checklist

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    It will drop for sure - GA is basically a luxury/leisure industry and with 30+ millions of people out of work ( with a lot of small business owners being currently wiped out ) how is it going to increase ?

    Now how much it will drop ... who knows, we are still in the process of committing an economic suicide so probably nobody knows ..
     
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  4. Ravioli

    Ravioli Final Approach PoA Supporter

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    I think PA32-300's will be going for $30k again. Just ask any YouTubeHero you happen to meet.
     
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  5. forsonsinc

    forsonsinc Pre-Flight

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    I was thinking they might increase in short future anyways.
    All this fake money the gov is giving could cause a rash of purchases. More purchases equals more demand equals increase.
    Just a uninformed ,tired after sat morning ride so perusing the local wildlife, on poa guess.
     
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  6. hindsight2020

    hindsight2020 En-Route

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    I got my third (current) airplane during the tail end of the 08 fallout. I got it for a 40% discount from what the previous owners bought it for in 2005, and that was before they put in a 430W mind you. Accounting for the 430W probably a conservative 50% off. But that was a cosmetically discounted sample.

    For the cash kings it will be a good time buy a potential 10-year airplane imo. And don't fret, this recession will not be a V-shaped recovery so there's plenty of time to wait out the bleed without exerting much effort. Regardless of good or bad economy, the end of summer travel is usually a good time to scoop up things, though in fairness I got my current airplane in the dead of summer. The other two I did buy in the winter months.
     
  7. hindsight2020

    hindsight2020 En-Route

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    [​IMG]
    :D:D
     
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  8. GRG55

    GRG55 Final Approach

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    As in most every recession all the "essentials" of life are likely to get cheaper - motorcycles, mid-life crisis sports cars, snowmobiles, ATVs, boats, recreational airplanes, probably some training airplanes as well given the devastation in the global travel industry and the poor outlook for pilot demand.

    In the '08/'09 financial crisis a lot of piston twins got cut in half and have never recovered. I bought mine in the aftermath of that for an utterly ridiculous price. I had been looking for an A-36 Bo, but the piston twins were far more compelling value for the performance.
    Of course the oil price going into that recession was ~$150/bbl, avgas had been rising steadily in the 5 preceding years, and oil stayed above $100/bbl most of the time after, until the break downward in 2014.

    High performance singles (36-series Bonanzas, late model Mooneys, Cirrus SR22s and similar) seemed to hold up better than the V-tails and older 4-cyl retracts at that time.

    This time? The already squeezed bottom half of GA is almost certainly going to shrink some more as costs to maintain, insure and operate keep rising. The already well established trend to high end private airplanes will accelerate (Malibus, Meridians, TBMs, Cirrusjets, etc) as will the corporate and charter jet market.

    In 2009 Cirrus saw the sales volume of their piston airplanes get hammered (down from >700 in 2007 to <300 each year from 2009 to 2013, inclusive). Cirrus never got production back to anywhere near the previous volume. And this is the best selling GA airplane maker. It'll be interesting to see what happens this time. The move to the jet might prove very astute for their reading of where the GA market is headed.

    The sudden turn in the need to train for the now evaporated pilot shortage is not good news for Cessna and Piper. I wonder if Textron is going to further limit the piston models it produces (goodbye Bonanza & Baron?). Or get out of piston airplanes entirely? :(
     
    Last edited: May 2, 2020
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  9. MD2105

    MD2105 Filing Flight Plan

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    I know the asking prices for planes on Trade-A-Plane are likely (I hope) much higher than what they actually sell for. I just looked at some 172s and 182s just out of curiosity and it is pretty obscene what people are asking for for high-time junkers with clapped out interiors and vintage panels. Makes me think of the real estate market in California.
     
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  10. Eldorado

    Eldorado Pre-Flight

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    Just watch the boat prices, Recreational Vehicle, and other nonessential luxury items. Combined with aging pilot population and increased insurance premiums, there will be some good deals for many years. Of course it will effect the higher end that are not in top condition way more than the pristine condition. The simpler trainer and c172/182 not so much. Next year I can see a P210 selling for 50% less than a couple months ago. I look around and all my friends that have airplanes would gladly sell for 20% less than they paid 5 years ago, but no buyers till one gets down to 35%. We haven’t hit bottom by a long shot so be patient, cash talks.
     
  11. ebetancourt

    ebetancourt Line Up and Wait

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    This will be very dependent on the type of ownership. I had decided to sell one of my Wacos to buy a T-34A. I can't imagine the high-end T-34s coming down and the Wacos will as ride haulers give up. The difference will be much higher. High-end toys won't come down much - Warbirds, antiques, rarities IMO. Stuff that's normally financed = a lot IMO.

    There is a question in my mind about insurance, though. A lot of that stuff is owned by older pilots like me, and the insurance market is getting harder for us.
     
  12. Zeldman

    Zeldman Touchdown! Greaser!

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    Just low enough to be barely out of reach for me....
     
  13. hindsight2020

    hindsight2020 En-Route

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    I hear ya, I've been looking at TBMs too... :rofl:
     
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  14. Rcmutz

    Rcmutz Line Up and Wait

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    The evaporated pilot shortage will be a temporary thing. A lot of airlines have offered incentivized retirement. My friend who flies for AA was offered 60% of his pay with full benefits for the next two years until he reaches full retirement age. Once the pandemic passes, airline travel will pick back up. Probably take about 2-3 years.

    The complex singles will probably drop in price as the insurance cost for the more mature pilots co tiniest to rise for the next couple of years. Simple pistons like 172/182/PA-28/Tiger/Cheetah/any fixed gear will probably hold value as more folks look to “downsize”.

    One poster said the 182 prices are crazy. I agree. I have been watching them for many years and this last year has seen a large increase to ridiculous prices. With the economic slowdown, in about 6 months, a lot of these owners will be glad to sell at 10-20% below what they are asking now.
     
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  15. WDD

    WDD Line Up and Wait

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    I'm not in the market to buy, but do look out of curiosity. I have the same thought - what the heck? If they are getting these prices, good for them.
     
  16. 455 Bravo Uniform

    455 Bravo Uniform En-Route

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    I’ll be the odd man out. Always am. Sometimes right.

    Think of these 2 litmus tests as a gauge of where those people are financially that can afford planes as of February 2020 vs today:

    -How low is the stock market from where it was 1-2 years ago? Not far at all. Doesn’t mean it won’t crater. Just not there now.

    -How many people that can afford to buy and feed a GA bird actually lost a job or were furloughed? A lot are maybe desk workers, working from home. Others working are “essential workers”, but some maybe could never afford a plane. Some business owners are taking a hit. I look at my home drome...can’t see any one of my friends selling or settling for anything other than top price.

    I think the answers to those questions will help you assess how much supply and demand hit there will be. Assuming the above doesn’t get worse, I think you won’t see any impact. That’s my caveat.

    Do I think it’ll get worse? Different topic, different thread.
     
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  17. Warmi

    Warmi Pre-takeoff checklist

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    Oh, everyone will be affected ( some of them already are ) - if you have 30+ million people drastically reduce their spending habits to bare essentials ( which you tend to do when you are out of your job ) , stop paying their mortgages and other obligations , others , who are not currently directly affected , eventually won’t get paid as well and on and on ... just wait.
     
  18. Tusayan

    Tusayan Pre-Flight

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    The contrarian view might be that while other US options for freedom and recreation are currently being heavily repressed with no end in clear sight, in California (for example) ‘commercial and recreational aviation’ is explicitly listed as essential activity in the transportation sector. The Federal Government through ATC and airport funding is also fully supportive, fuel prices are sinking and that won’t likely change and meanwhile the skies will be emptier of commercial flights and therefore more accessible. When you can’t go on cruises, can’t easily vacation or travel commercially, can’t ride a motorcycle without some level of concern, can’t use a boat, can’t eat out and can’t do any number of things that involve close contact with other people, you might start looking for a plane because flying is what you can do... and it’s not any kind of health issue when you buy and fly your own versus renting. Renters and club members may be looking to buy for that reason.

    I think the income of the airplane buying public is not as heavily correlated with recent unemployment (either directly and indirectly) as buyers for many other things may be. More managerial, technical and governmental, less ‘non-essential’ sales and service to the public. I could be wrong.

    I am regardless particularly happy to be a pilot and aircraft owner at the moment, and I could see that being true for others in 2020.
     
    Last edited: May 2, 2020
  19. G-Man

    G-Man Line Up and Wait

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    From my view, the cost of the airplane is almost a secondary issue. It's the operating costs - fixed and variable - that have the biggest impact. They don't seem to be changing much and that's what drives the costs of flying, whether owning, renting, or borrowing.

    Fuel, hangar, maintenance, insurance, etc., may have a bigger effect on the viability of flying than purchase price.
     
  20. MD2105

    MD2105 Filing Flight Plan

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    I think in terms of basic economics, prices might go down because the used market gets flooded with more planes for sale because desperate owners are trying to liquidate assets. In that case, I'd predict those owners probably started deferring maintenance issues a while before they decided to fold. Or, their decision to sell coincides with an annual that is just not affordable to them anymore.

    There will be a mix of reasons why some owners will decide to sell. Like 455BU wrote, some will be fortunate enough to not find themselves in a position where they would need to sell to free up cash (I am grateful to be in this category). Some small business owners who own aircraft might have to sell to free up capital to keep their business afloat, or might go out of business and have to sell anyway. Other airplane owners might have only been able afford a Cherokee 140 or similar "low-end" plane with a loan they can't afford anymore because they lost their job or business. That or they can afford to make the payment, just not the maintenance and operating expenses. As G-Man said, that's a much bigger factor than purchase price.

    I bought my plane in 2015 and had to step over a pile of junkers to find mine. I paid a premium for it, but having scoured T-A-P, Controller, Barnstormers, etc. for so long, I knew it was a good value. 5 years later, I find myself "window shopping" Trade-A-Plane and Controller from time to time and the prices are ridiculous across the board compared to what they were only a few years ago and the condition of these planes are pretty awful. One seller didn't seem to even bother to wash their plane for the pictures they attached to the ad!

    Sure, if the economy continues to sour you might find some cheaper purchase prices. If I were in the market, I'd keep a heap of cash off to the side for that first annual (provided it even makes it through the pre-buy).

    OP mentioned he was interested in a P210 which from what I understand is a very maintenance intensive aircraft. My only advice would be to be very suspicious of the new ones that come on the market and those that have been on the market for a while.
     
    Last edited: May 3, 2020
  21. MooneyDriver78

    MooneyDriver78 En-Route

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    I think the low in the market was around 2014. There was a lot of planes for sale that hadn’t flown much. Used plane prices won’t be affected in 2020, if economy is bad for a few years, then as more used planes go unsold they will drop.
    Weren’t we discussing how ADSB was going to force owners to sell and the used plane market was going to tank?
     
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  22. brien23

    brien23 Cleared for Takeoff

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    ADS-B several C-182 listed in trade-a-plane without ADS-B, how can you sell a 75 to 85,000 plane without it. Makes you wonder what else was not done if they can't put that in for 2K investment. I also see listings with assume payments, the next year could be great to buy with value dropping like a rock or not, only time will tell. Now is not the time to jump if you have cash sit and wait 30 or 40% drop might only be the starting point.
     
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  23. Kenny Phillips

    Kenny Phillips En-Route

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    It's not fake money, it's real money, paid for by the money already in your pockets. So you'll see some inflationary price increases, but in terms of individual purchases of luxury items, not so much. I predict airplane prices will be where they were six or seven years ago. That's when I sold mine, of course.
     
  24. Ventucky Red

    Ventucky Red Cleared for Takeoff

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    Friend bought a Beech Sport and after a few months didn't like it.. Sold it for what he was into it for. The plane was on its way to a flight school.. The nice ones are being scooped up pretty quick.

    One would think that Cessna would ramp up the 152 line in answer to Piper $250K single door trainer.
     
  25. WDD

    WDD Line Up and Wait

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    I would say given today’s student and CFI “ballast size” the 152s just don’t have the performance needed these days vs 50 years ago when the 150 / 152 were popular.

    Which - IMHO - LSA’s are not going to have a shot at dominating training despite being more modern and cheaper to fly.
     
  26. brien23

    brien23 Cleared for Takeoff

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    Note. a bunch of old fat overweight CFI's more so now than years past, not to many DPE lightweight's around that can fit into a C-150, kind of put's a limit on the old 150 even if they can get the doors closed.
     
    Last edited: May 3, 2020
  27. Southpaw

    Southpaw Pre-takeoff checklist

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    I did 20 hours in a 150 with flight instructor who weighs 260 .Tall Dude, Not Fat . I'm 220 but not really fat, more of a beer belly . Loading is interesting . He got in first I could stand on ground and place right leg in and get my # 12 left foot in the door .Still rather flexible at age 79 . Long runway , anemic climb.
    The 1959 172 I bought is much more comfortable and easier to get in and get doors closed . Twice the climb rate of the 150.
     
  28. Bug H

    Bug H Filing Flight Plan

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    <excuse the venting>

    I've been off-on-off-on looking since 2003 (SEL/160-200 hp). Umpteen military moves didn't help, but that's all "part of the program," suitable for a different thread. *Finally* in a good cash spot to get serious (not inclined to finance an airplane) - started shopping TAP/Barnstormers and ... HOLY SMOKES! - You want HOW MUCH for a 196x/197x C172 with a run out motor and cooked radios?! Price of entry, insurance, and hangar availability are REALLY making this a challenge for a regular guy these days. Did I miss something or did GA silently 'boom' when I wasn't looking? (I would certainly embrace that, but I'm not seeing it from my chair)

    Don't get me wrong - I'm grateful I'm still employed, and I have been known to be "mistaken" many times. Just ask any one of my wives o_O

    <venting over... I need some prayer time>
     
  29. Palmpilot

    Palmpilot Touchdown! Greaser!

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    The last recession ended in 2009. That might have something to do with it.
     
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  30. Ventucky Red

    Ventucky Red Cleared for Takeoff

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    Go look at some of the 141 schools... There are many recent EBR, UND, OSU, etc... gradflight instructors out there that are below the 200 lbs. And the students.... youngsters too...
     
  31. Tantalum

    Tantalum Final Approach

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    There is lots of perceived delusional value you'll see on Trade a Plane and barnstormers.. even if prices don't drop because of said delusional owners you'll see fewer and fewer people buying planes and more and more rotting derelicts littering our slowly dying air fields, while the handful of people who HAVE money go and buy a certain composite plane and get ridiculed because they don't feel like spending their dough on a 1967 plane that's falling apart and will need at least $50K in work (and lots of time) to make it somewhat commensurate with 21st century technology..

    It's very depressing looking at what options are out there to buy

    Many people who *could* afford something in the $80K-$120K range just aren't interested in what that market has to offer.. and the nice stuff is out of reach

    At least with EA (which I believe will continue to grow) the entry costs are more reasonable, the FAA mandated costs are more reasonable, and you have more flexibility in actually building/buying what you want
     
  32. Cogito

    Cogito Pre-takeoff checklist

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    A Flight Academy here in Southern California uses LSA's to make ATP's, except they use Tecnam Twins for multi-engine. With those planes and full-motion simulators the students are getting a solid education in modern systems and avionics for a little less money. The students and Flight Instructors looked young and fit, useful load won't be an issue, just hope the new economy will have a place for them.
     
    Last edited: May 3, 2020
  33. benyflyguy

    benyflyguy En-Route

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    Here’s to hoping!! :cheerswine:
    Part of my 310 purchase plan is some economic downturn.
     
  34. BPM

    BPM Pre-Flight

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    The Federal Reserve’s balance sheet went from $800 billion to ~$6.5 trillion (and growing). That might have everything to do with it.
     
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  35. snglecoil

    snglecoil Pre-takeoff checklist

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    All I know is that I’m watching like a hawk for any sign that light singles will return to some sort of pricing sanity. Nobody’s budging yet!
     
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  36. aftCG

    aftCG Pre-takeoff checklist

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    You do realize that most of the country does not have a mode C veil, right? Those are the places where life is more affordable, hangars are cheaper, etc.

    C172s have been way over priced because flight schools were snapping them up to meet the unhinged demand for training aircraft. I'm going to guess that may calm down a bit.
     
  37. schmookeeg

    schmookeeg Pattern Altitude

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    Buy something that isn't the aviation equivelant of a Toyota Corolla and you'll find prices more reasonable.

    Now that pilot hiring has snapped from "can mostly fog a mirror -- into the right seat!" to "furloughs for all, lol", these schools are going to pop and these planes are going to be auctioned off on the supercheap.
     
  38. frfly172

    frfly172 Touchdown! Greaser! PoA Supporter

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    Time will tell,will have to see how fast the economy recovers.
     
  39. Sinistar

    Sinistar En-Route

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    Just raw thoughts:

    Prices were inflated so should come down some, but I don't think that much.

    As stated above, people will just fly it less for the first N months or year or two before selling (stated earlier).

    What percent of this recession's unemployed are also aircraft owners?

    Flight schools...sure. But doctors, dentists, lawyers, engineers, medical professionals, plumbers, fed workers, state workers, city workers, heck even teachers are still getting paid to teach virtually.

    If the majority of GA pilots worked (hourly laborers) at restaurants, hotels, cruise ships, airlines, malls, etc then pretty sure you'd already see the prices dropping. The same if most commercial pilots also owned planes (probably the more senior ones do, but not the population in general).

    Just thoughts...
     
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  40. PlaneFlyer

    PlaneFlyer Filing Flight Plan

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    As a point of reference, I recently sold my 182 for a bit over 70% of the original price I listed it for on Trade-A-Plane. List price seemed optimistic and was $12.5k over what I bought it for 2.5 years ago, but commensurate with other planes of its vintage listed on those sites (I did bring the avionics into the 21st century since I purchased it). Based on some significant engine items discovered in the prebuy and the fact the the engine was last overhauled when Reagan was in the White House, I think the price we settled on was fair for both parties.

    I’m definitely interested in seeing how the market will react and trying to time it appropriately. While we’re taking a calculated break from aircraft ownership, we’ll be looking to get back into it in the next 4-6 years.