I’m calling the peak

FormerHangie said:
I feel for those of us who'd like to buy an airplane, this market is depressing.
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What!? You're saying you don't want to spend $130k for a 60 year old Cherokee 180 with a run-out engine (but a recent top overhaul!), with a standard 6 pack and a GNS430 and a #2 NAv/COM that looked like it was built during the Jurassic era?

Yeah, the market is pretty silly... Finding the most inane listings has become something of a hobby -- but the sellers have made it too easy.
 
ArrowFlyer86 said:
What!? You're saying you don't want to spend $130k for a 60 year old Cherokee 180 with a run-out engine (but a recent top overhaul!), with a standard 6 pack and a GNS430 and a #2 NAv/COM that looked like it was built during the Jurassic era?

Yeah, the market is pretty silly... Finding the most inane listings has become something of a hobby -- but the sellers have made it too easy.
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Avionics shmavionics... It has the "custom" wool carpet and a new battery. What else do you want? Gee, these buyers are so picky.
 
Tried to offer a guy cash this week for a G-2 FT with a time bomb engine (less than 300 hours in 26 years, original run) and /U panel lol, but given the track record of my interactions in the past few months, I decided to stop showing my cards. So all I told him was "would you consider an offer?" I was cut off immediately with a terse "price is non-negotiable, I'll just keep it and fly it", seemingly annoyed at the inference the engine presents a resellability problem and the epicenter of the pricing impasse (lord knows it would be me taking all the price risk for that engine going forward). The poker tell was not being even interested in hearing the cash offer at no cost to him. They're just not serious sellers, no different than the oft-smeared "tire kicker" on the buyer side.

Things are silly and continue to be, but nothing lasts forever.
 
Lot's of people only willing to sell if they can turn a profit right now. They see one posted for sale and set their price accordingly yet have no idea if the other sold. The market is so odd right now that it seems people see a plane like theirs for sale and list theirs for even more despite being comparable. This is the opposite of what you would expect..
 
Just posting a data point. I bought right about when this thread was created. I sold earlier this month. After accounting for the avionics I installed, I broke even. That's the cost of the equipment only, not installation costs. I believe I could have made a profit if I were more patient, or used a broker. I had a really bad experience with a potential buyer and just wanted done with it after that.
 
TCABM said:
Profit on a depreciating toy with high OpEx is an interesting concept.
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I've made offers on a few airplanes and the general response is "I have more than that in it". Well if you bought a plane the last 2-3 years yea, you have too much in it.

The other thing that drives me nuts are the people who keep listing their planes over and over and over again at the same price. Clearly you were asking too much, the times aren't changing which means it's sitting. Each month it depreciates a bit more and you are still paying for hangar cost. One guy has been trying to sell his plane for 3 years. I had offered him 10k less than he was asking and was turned down. Since that time he has paid for 2 annuals and 24 months worth of hangar rent and maybe flew the airplane an hour.
 
Grum.Man said:
I've made offers on a few airplanes and the general response is "I have more than that in it". Well if you bought a plane the last 2-3 years yea, you have too much in it.

The other thing that drives me nuts are the people who keep listing their planes over and over and over again at the same price. Clearly you were asking too much, the times aren't changing which means it's sitting. Each month it depreciates a bit more and you are still paying for hangar cost. One guy has been trying to sell his plane for 3 years. I had offered him 10k less than he was asking and was turned down. Since that time he has paid for 2 annuals and 24 months worth of hangar rent and maybe flew the airplane an hour.
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These are the same people who let their airplanes rot on the tarmac with flat tires and deteriorate to scrap because their pride won’t let them take anything less than their ego will let them.
 
WDD said:
These are the same people who let their airplanes rot on the tarmac with flat tires and deteriorate to scrap because their pride won’t let them take anything less than their ego will let them.
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Well at least they can still brag to their friends that they own an airplane ... :dunno:
 
Salty said:
Just posting a data point. I bought right about when this thread was created. I sold earlier this month. After accounting for the avionics I installed, I broke even. That's the cost of the equipment only, not installation costs…
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What about insurance, fuel, oil, and other maintenance? All that contributes to the sunk cost of ownership. Profit is what’s left after all expenses, but with toys, most people (even me) tend to discount OpEx and only look at acquisition cost and value adds as expenses, which is why I laugh at the thought of making profit on a non-commercial use item. Even most flippers will end up discounting their labor and overhead, knowingly or not.

I’m okay with that, too.
 
TCABM said:
What about insurance, fuel, oil, and other maintenance? All that contributes to the sunk cost of ownership. Profit is what’s left after all expenses, but with toys, most people (even me) tend to discount OpEx and only look at acquisition cost and value adds as expenses, which is why I laugh at the thought of making profit on a non-commercial use item. Even most flippers will end up discounting their labor and overhead, knowingly or not.

I’m okay with that, too.
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The cost of operations is the cost for the enjoyment of that experience. If I sold the plane for a loss, that would simply make the cost for those experiences higher than I budgeted for. So, being able to break even, means my costs for that recreation did not expand. Had I made a "profit" it would simply mean my costs for the recreation I experienced were lowered.
 
TCABM said:
but with toys, most people (even me) tend to discount OpEx and only look at acquisition cost and value adds as expenses
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I’m in the same camp as @Salty on this one. If the plane were a business asset, I might look at it differently, but for a toy the OpEx is just the cost of playing. It’s an expendable, with no need for a return, just like the cost of a vacation.
 
Half Fast said:
I’m in the same camp as @Salty on this one. If the plane were a business asset, I might look at it differently, but for a toy the OpEx is just the cost of playing. It’s an expendable, with no need for a return, just like the cost of a vacation.
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Y’all are kind of making the point; non-commercial depreciating things don’t generally turn a profit because they’re not operated to do so.

Making profit on transacting recreational use toys is an exercise in justification or the result of a lopsided market.
 
TCABM said:
Y’all are kind of making the point; non-commercial depreciating things don’t generally turn a profit because they’re not operated to do so.

Making profit on transacting recreational use toys is an exercise in justification or the result of a lopsided market.
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Or maybe they are upside down on the loan on their toy. Which means they'd still be paying on a smaller loan balance for the difference on a toy they no longer have. That's got to be an ego sting.

I think TCABM and Half Fast nailed it. This is a hobby - it makes no financial sense; never did and never will. A plane isn't a house, it's a truck/car/boat. It isn't an investment, its a thing that you buy so you have the joy of throwing more money at on a regular basis and then eventually sell it for something to get rid of it.
 
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This is a hobby for pretty much everyone here, but it's business for a lot of people as well. And the business side of the house puts different kinds of financial pressures on the plane market.
 
TCABM said:
Y’all are kind of making the point; non-commercial depreciating things don’t generally turn a profit because they’re not operated to do so.

Making profit on transacting recreational use toys is an exercise in justification or the result of a lopsided market.
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Well, it's all in how you do the accounting.

Consider - Let's say I own a plane and use it as a rental. My renters cover all the OpEx. After a few years I sell the plane for more than I paid for it. Did I make a profit? Sure.

Now, let's say I use the plane myself and pay all the OpEx out of my personal entertainment budget, the same bucket of money I use for vacations, concerts, etc. Were the money not being used to fly the plane, it would be spent on some other form of entertainment. In essence, I'm my own renter. After a few years I sell the plane for more than I paid for it. Did I make a profit?

I'd say yes. My personal living expenses, including entertainment costs such as the plane OpEx, are unrelated to whether I made a profit on the airplane. My bank account might even show a net loss, but that doesn't mean I didn't make a profit on the plane.
 
Prices are stable to climbing across the board. This doesn't appear to be slowing. We recently sold our late model 206HD turbo for a significant premium to our fairly recent purchase price. Hartzell is now owned by hedge fund that immediately increased prices significantly. We're trying to buy a new, larger more capable plane but most new aircraft are sold six months to a year out. We'll probably end up buying at the top, but that's better than not having a plane.
 
Aldeskeukin said:
Prices are stable to climbing across the board. This doesn't appear to be slowing. We recently sold our late model 206HD turbo for a significant premium to our fairly recent purchase price. Hartzell is now owned by hedge fund that immediately increased prices significantly. We're trying to buy a new, larger more capable plane but most new aircraft are sold six months to a year out. We'll probably end up buying at the top, but that's better than not having a plane.
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I wonder what the price increase is with inflation adjusted dollars?
 
The pricing nuances of work airplanes like 206 and 172s, "across the board" do not make.
 
WDD said:
I wonder what the price increase is with inflation adjusted dollars?
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There is inflation due to the Fed's continuous printing of more currency to service debt and create liquidity and then there is inflation that happens when a hedge fund buys Hartzell and increases prices 100% because they can. Fed inflation is predictable and makes it easier to pay off our houses, cars and planes. Hedge fund induced inflation is unpredictable and insidious. Inflation adjusted dollars are ~ 2% annually which is manageable. The hedge funds are a wild card. Hoping to get a SLS600 before it breaks 4M but we will see ...
 
Aldeskeukin said:
There is inflation due to the Fed's continuous printing of more currency to service debt and create liquidity and then there is inflation that happens when a hedge fund buys Hartzell and increases prices 100% because they can. Fed inflation is predictable and makes it easier to pay off our houses, cars and planes. Hedge fund induced inflation is unpredictable and insidious. Inflation adjusted dollars are ~ 2% annually which is manageable. The hedge funds are a wild card. Hoping to get a SLS600 before it breaks 4M but we will see ...
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Inflation adjusted depends on your time frame.
If you're looking at the Fed for the better half of the decade, they undershot their 2% goal.
If you look post March 2020, they successfully hit double digits for a bit (depending on which basket you use).

Hedge fund induced inflation is not where most of the growth from the GA market comes from.
 
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ArrowFlyer Scraper Data

End-ish of December to start of Feb.

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Sandhills Aviation Data (bullet points are their intel):
  • Sandhills observed significant decreases in used piston single aircraft inventory levels in January, down 10.83% M/M and 20.1% YOY. Inventory levels are trending down.
  • Asking values dipped 0.34% lower M/M, increased 1.69% YOY, and are trending down.
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Here's another "peak" post IMHO.
The G5s and A/P are nice. But...

9200 TT, '73 PA28R
Only 530 SMOH and already 2 IRANs on the engine at least one due to do the...
Gear up in 2022
And still is asking 135k$

I feel like the guy's quote (feel bad for him) is indicative of probably a lot of sellers:
"I have put so much time and money into this plane it is almost embarrassing"

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I don’t know how prices will come down - the supply of affordable planes keeps getting smaller and the cost of new planes is prohibitive for most of us.
 
ArrowFlyer86 said:
Here's another "peak" post IMHO.
The G5s and A/P are nice. But...

9200 TT, '73 PA28R
Only 530 SMOH and already 2 IRANs on the engine at least one due to do the...
Gear up in 2022
And still is asking 135k$

I feel like the guy's quote (feel bad for him) is indicative of probably a lot of sellers:
"I have put so much time and money into this plane it is almost embarrassing"

View attachment 125167
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Not confidence inspiring. Reputable recent OH w/infant IRAN, gear up, only an oblique reference to the likely prop strike that came with the gear up.

That ad gives me vibes of TNflygirl.
 
Eric Brunelle said:
I don’t know how prices will come down - the supply of affordable planes keeps getting smaller and the cost of new planes is prohibitive for most of us.
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Seems likes it’s a horse race between the old airplane crash rate rate and the declining population of old pilots with money.
 
Coming up on 2 years since the OP. It's tough to make predictions, especially about the future.
 
Ed Haywood said:
Coming up on 2 years since the OP. It's tough to make predictions, especially about the future.
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Wasn't it Yogi Berra who said "The future's easy to predict when you look back at it."?
 
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Eric Brunelle said:
I don’t know how prices will come down - the supply of affordable planes keeps getting smaller and the cost of new planes is prohibitive for most of us.
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Supply and demand. The supply of people who can afford the higher prices will decline so the amount demanded by the seller, if they really need to sell, has to follow. I'm seeing it with home prices just starting to drop in big chunks while I scout potential retirement locations.
 
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