V Ref and aircraft pricing

[asgcpa]

Ok - stupid questions...but:

1. How accurate is V Ref and where do they derive their data? How often is V Ref data updated?

2. Is there a better way to compute a market value for used aircraft? It seems every seller seems theirs is the best since sliced bread and prices accordingly.

 

[VA Aviator]

Ok - stupid questions...but:

1. How accurate is V Ref and where do they derive their data? How often is V Ref data updated?

2. Is there a better way to compute a market value for used aircraft? It seems every seller seems theirs is the best since sliced bread and prices accordingly.

1. V ref is based upon aircraft dealer data, and does not take into account (nor would there be a reliable way to) "face to face" private party-private party sales. IIRC there's a way for individuals to report sale data but who knows how many people do - probably very few. The book version reports the volume the numbers are based off of, not sure about the online version.

2. You can do like I just did and post a thread here and see what happens...


IME, Vref isn't the greatest source for small aircraft due to the fact that most sales are private party, conditions vary wildly, avionics vary wildly, etc. For larger aircraft that are primarily traded through brokers, sure.

 

[frfly172]

V ref is probably more of a dealer handbook. The newer the aircraft the closer the pricing.once the aircraft start to reach the private sales area the prices can go anywhere.

 

[ChitDisturber]

Best way to value a aircraft, keep a eye on the going ons on barnstormers, trader, controller, aso, etc.

It's worth what the market will bear (just as that guy trying to sell that 150 for $35k) and the best way to tell what it will bear is watching the sales sites IMO.

 

[asgcpa]

Best way to value a aircraft, keep a eye on the going ons on barnstormers, trader, controller, aso, etc.

It's worth what the market will bear (just as that guy trying to sell that 150 for $35k) and the best way to tell what it will bear is watching the sales sites IMO.

I'm just having a hard time determining the market. I have started to resort to asking sellers what the planes sold for so I can get an idea. Some tell me others don't.

 

[N747JB]

I'm just having a hard time determining the market. I have started to resort to asking sellers what the planes sold for so I can get an idea. Some tell me others don't.

Some tell the truth, others lie! I emailed a broker last week to ask what an airplane I had made an offer on had sold for. The ask was 995K, I had offered $825K in March, I spoke to another guy looking at Conquests and recommended this airplane, but told him it was priced too high. The other guy told me they had reduced it substantially, the broker said it sold for $965K As-is.
I'm pretty sure the broker was blowing a little smoke.

 

[N801BH]

Some tell the truth, others lie! I emailed a broker last week to ask what an airplane I had made an offer on had sold for. The ask was 995K, I had offered $825K in March, I spoke to another guy looking at Conquests and recommended this airplane, but told him it was priced too high. The other guy told me they had reduced it substantially, the broker said it sold for $965K As-is.
I'm pretty sure the broker was blowing a little smoke.

...

Easiest way to tell if a aircraft broker is lying.... Watch his/her lips... If they are moving.. they are LYING...

 

[ChitDisturber]

I'm just having a hard time determining the market. I have started to resort to asking sellers what the planes sold for so I can get an idea. Some tell me others don't.

Sound like a trip up BS alley!

Just keep a eye on which planes have "sold" next to them, or ask if their plane is still available, look at the ASKING prices on the planes which have sold and are comparable to your plane and go from there

Brokers are funny, I wouldn't rely on them for pricing.
I like buying planes from brokers, they always ask a bit much yet it's easier to slash their prices when compared to private sellers, after all they don't take the same hit as the owner when they whore a plane out.

 

[Bob Noel]

Ok - stupid questions...but:

1. How accurate is V Ref and where do they derive their data? How often is V Ref data updated?

2. Is there a better way to compute a market value for used aircraft? It seems every seller seems theirs is the best since sliced bread and prices accordingly.

It's been my impression that vref is about 35% too high, especially if you add in lots of the various extras.

 

[AdamZ]

My impression is that vRef is high 9 out of ten times.I prefer the NAAA evaluator tool on Trade a Plane. I find it much more detailed. You have to subscribe to Trade a Plane to use it but it's very inexpensive. Where I've seen vRef lower is in planes that are much older and run out.

 

[Tony_Scarpelli]

I think vref is a good tool I also look at NAAA evaluator and then I have a high and low.

the problem with any guide is do you know what a 7 paint or 4 paint is? So your ability to evaluate engine 5, Panel 5, Paint 5, Interior 5. This is just the beginning, how many ours flow this year? Is it within annual? Does it have all original equipment? Does every piece of equipment work?

The hardest part about buying a plane is all the fools trying to sell them.

Even if they are some what sophisticated about valuing their plane they cannot come to a realistic conclusion as to whether it is a 7 or 8 or 9 in any category.

I never want to by a plane with a new engine that is the highest price you can pay, no upside only down side if it fails. Id rather buy a runout engine on a plane with a decent panel/autopilot and frame.

I can tell you that value and what is listed on controller or TAP bare no resemblance so you learn nothing about how to price a plane by watching controller or tap. Other than how stupid airplane sellers are.

After talking to many toads I just stopped calling or messing with any aircraft that was obviously over priced without having new paint, new FWF, new Garmin/wass/autopilot or the like. In other words if the ad reads like a plane old nice bird but the price is like it was a jem then I would skip calling that guy and go to one more reasonably priced.

Ok - stupid questions...but:

1. How accurate is V Ref and where do they derive their data? How often is V Ref data updated?

2. Is there a better way to compute a market value for used aircraft? It seems every seller seems theirs is the best since sliced bread and prices accordingly.

 

[hkyplr18]

...

Easiest way to tell if a aircraft broker is lying.... Watch his/her lips... If they are moving.. they are LYING...

Ben- Might be true for a lot of brokers but please don't put us all in the same boat. I will tell you exactly how it is if you are looking at an airplane I have for sale. I pride myself for being truthful and I think it's part of why I've been successful in the broker world.

Not a fair statement to make...

 

[Jeff K]

2. Is there a better way to compute a market value for used aircraft? It seems every seller seems theirs is the best since sliced bread and prices accordingly.

Most seller's look at the asking prices in the trades to set their prices. Of course, this feeds into the group delusions of overpriced aircraft since the aircraft that get the most ad coverage are generally the aircraft that sit unsold.

Broker's provide one valuable service to me... set the seller's expectations to a reasonable level. Unfortunately I've never been able to close a sale with a broker as most are allergic to purchase contracts that don't entirely favor their interests.

As to Vref... it's a starting point. If the seller is substantially above Vref or has a "Call for price" I generally don't bother. As a general rule... I target about 30% below Vref to start.

The two best Gems so far are from Tony:

The hardest part about buying a plane is all the fools trying to sell them.

Yeap. When I make an offer to a seller, I do two things:

1. Show them I have the funds.... either a bank statement or a preapproval letter

2. Clear terms/contingencies that quickly take us to closing.


In saying no, the foolish ones (and many brokers) get emotional. The smart ones, in recognizing it's just business and we are talking about a hunk of metal, either counter or just state it's two low of a price. And sometimes (twice now in fact) I hear back from them a few weeks later and we come to terms. There are *alot* more foolish ones then smart ones.

I never want to by a plane with a new engine that is the highest price you can pay, no upside only down side if it fails. Id rather buy a runout engine on a plane with a decent panel/autopilot and frame.

BINGO. To me my biggest fear is not knowing what I'm buying. If I buy a plane with a higher time engine/ bad paint, I know what I'm buying.

 

[rbridges]

I used Vref to make sure I wasn't being raped, but I also compared the asking price to other comparable aircraft. When I financed the plane, the bank used Vref values to approve the loan.

 

[asgcpa]

I never want to by a plane with a new engine that is the highest price you can pay, no upside only down side if it fails. Id rather buy a runout engine on a plane with a decent panel/autopilot and

Tony this is exactly what I am focussing in on.

 

[steingar]

I never want to by a plane with a new engine that is the highest price you can pay, no upside only down side if it fails. Id rather buy a runout engine on a plane with a decent panel/autopilot and frame.

I always thought it would be cool (for me) to buy the airplane that got the huge makeover the day before the owner lost his medical. You certainly get a huge discount compared to doing those things yourself, probably big enough to buy a new engine if the thing breaks. Of course, how often do airplane engines break anyway?

 

[N747JB]

I always thought it would be cool (for me) to buy the airplane that got the huge makeover the day before the owner lost his medical. You certainly get a huge discount compared to doing those things yourself, probably big enough to buy a new engine if the thing breaks. Of course, how often do airplane engines break anyway?

The problem is most guys that lose their medicals put the plane in a hangar or on tie down until they get it back. 3 years of rot later, it's for sale at what he's got in it!
Buying or selling I try to look at asking prices, equipment, times etc and watch and see what sells. if you study a particular airplane segment, you recognize the ones that aren't really for sale, or that have some issues.
I just make a list of airplanes, with N numbers and see if they sell, and how quickly. Just cause it's off the market doesn't mean it sold.

 

[steingar]

The problem is most guys that lose their medicals put the plane in a hangar or on tie down until they get it back. 3 years of rot later, it's for sale at what he's got in it!
Buying or selling I try to look at asking prices, equipment, times etc and watch and see what sells. if you study a particular airplane segment, you recognize the ones that aren't really for sale, or that have some issues.
I just make a list of airplanes, with N numbers and see if they sell, and how quickly. Just cause it's off the market doesn't mean it sold.

Oh, absolutely. Timing is everything. What I was saying is if you buy the most expensive one, even at a substantial premium, you'll still spend far less than what all that work would cost you to do.

Of course, the converse is to buy an old ugly but serviceable airframe with a run-out engine and do the rebuild yourself. You'll spend way way more than the aircraft was ever worth. But you'll have a better than new aircraft redone to your specifications for a fraction of what a new airplane costs.

 

[Jeff K]

The problem is most guys that lose their medicals put the plane in a hangar or on tie down until they get it back. 3 years of rot later, it's for sale at what he's got in it!

3 years? Had one of those sell last year down the row from me... guy lost his medical... hoped to get it back for 8 years... then tried selling it once he went into a nursing home... but it took going to an estate sale for it to sell after he passed.

 

[byrdman]

Ok - stupid questions...but:

1. How accurate is V Ref and where do they derive their data? How often is V Ref data updated?

2. Is there a better way to compute a market value for used aircraft? It seems every seller seems theirs is the best since sliced bread and prices accordingly.

It depends on which model your booking out, certain models book out 10% higher than fair market value every time, others book out lower than what they will go for. Vref is a good starting place but a reputable broker experienced in the type and current market is the best source for current values.

Vref is updated quarterly and always seems to be a quarter or two behind the market.

 

[Tony_Scarpelli]

\\\

typical

3 years? Had one of those sell last year down the row from me... guy lost his medical... hoped to get it back for 8 years... then tried selling it once he went into a nursing home... but it took going to an estate sale for it to sell after he passed.