AircraftOwner Online

I have a number of friends who seem to buy and sell airplanes as though they were aircraft dealers. But they aren’t. They just seem to get a thrill from wheeling and dealing and flying a “new” aircraft every so often. The recent market decline seems to have them in a veritable feeding frenzy. Perhaps because, comparatively speaking, there are some real bargains out there.

For example, a good friend of mine purchased a King Air from another friend. He was using it to commute between his home in Minnesota to his office in Ohio. Apparently, the it was not fast enough so he started shopping for a Cessna CJ. He found one with between 2,000 and 3,000 hours and paid something on the order of $1,700,000 for it. Now the King Air is for sale. While it’s a higher time aircraft, everything seems to work. I’ve flown it and it flys well and appears to be in great overall condition. My guess is that it can be had for something just north of $350,000. That seem like a bargain to me.

Another friend purchased a beautiful, older, straight-tail Cessna 182 – the kind with the hand-operated flaps – for only $35,000! If I did not already have my Cessna 182 (the first aircraft I ever owned), I would have gotten in on the bidding. There definitely are some bargains to be had, from props to jets, if you are at all inclined to make a purchase. The question is, how long will the good prices last and were do you go to find them?

First you need to determine the true market value of the aircraft you are interested in. With the recent sharp drop in prices, I’m not sure the commonly available aircraft “price guides” can really keep up. In most aircraft-for-sale advertising, the asking prices seem to be quite a bit higher than what the seller can reasonably expect to get. While auctions are generally a good indicator, there are few live aircraft auctions in the United States. When you find one, they also tend to reflect inflated values.

For example, I am an antique airplane guy. I noticed a 1929 Hamilton Metal Plane being auctioned off at the Barrett—Jackson auction in Phoenix a few days prior to this writing. It was my expectation that the aircraft would go for some fraction of the recently advertised asking price of $1,000,000 (everybody with a rare aircraft seems to round the asking price off to the nearest million). At the auction, the hammer came down at $610,000. This seemed like a full price to me. Shortly thereafter the Barrett—Jackson Web site listed the selling price as $671,000, which includes a 10% “buyer’s commission.” For the seller there were additional fees, which typically include an additional 8% or so of the hammer price. This means the sellers probably received around $561,000, which is $110,000 less than what the buyer ultimately paid.

There are online auctions as well. I wish E-bay was better at promoting its auction site, but it does pretty well. I can’t help but wonder what the Hamilton would have brought if it had been listed there. Even with a reserve price, they could have found a good definition of the market and perhaps even netted more money. But, as they say, “hindsite is 20/20.” No one could have known what the live auction would bring. I just checked E-bay and found everything from a Falcon 20 with a starting bid of $2.5 million to a 1945 Taylorcraft with a current bid of $12,500. There were more than 250 aircraft listings today when I checked. It’s my understanding that there is a small listing fee and E-bay charges something on the order of 1.5% of the selling price.

Other alternatives for buying and selling aircraft are the various publications and online listings, which we are all familiar with. These vary in price and do not involve commissions. Of course, you can also use an aircraft broker to represent your
sale or your purchase. Unless you are a confident buyer, finding and using a good aircraft broker may well be your best alternative. They know the market and can provide advice and council for your transaction, which makes their commission money well spent.

As a seller, the key is to be realistic in your price. Let’s face it: today we are in a buyer’s market. If I were to sell an aircraft, I would first study the asking prices of similar aircraft and watch E-bay auctions to get an indication of what the aircraft are actually selling for. I would then list it with publications that have a strong online presence – and are reasonably priced.

AircraftOwner’s online-classified listings are absolutely free. That’s a pretty good price! So list your aircraft with us, and then consider other options. Next, I would try an E-bay listing with a reserve I had determined would be realistic. If it does not sell there, I would then contact a broker. Of course, if you don’t want the “hassle” of selling the aircraft yourself, go directly with a broker after doing your research and getting a rough idea of the market price.

As a buyer, I would follow these exact steps as well. Educate yourself, get out there and check the market and, if you are comfortable, cut your own deal. Don’t forget to get a good mechanic to help you with the pre-buy. Also, keep in mind what it will cost you to repair or upgrade the aircraft to your liking.

If you are in the market, start by visiting AircraftOwner Online Aircraft Listings, which are free to buyers and sellers alike. Buying a new aircraft can be fun and exciting – and the “flying season” is upon us!