Looking to buy my first plane and need some advice

[Ranger_Chris61]

On 11/25/2016 at 5:19 PM, rbridges said:

In reality, I don't think owning is cheaper than renting in most cases.  What you get is convenience and control over the aircraft.  Your insurance will be pretty high if you buy a mooney as a student.  Don't feel rushed to get a mooney for the "saving money" aspect because I don't really think it's there.  

I have to disagree with you on this. For right now I am looking at least another 150-180 hrs to get at least a commercial rating (30 more hours to an instrument rating + 120 for commercial + over runs). At $150/hr to rent that adds up very quickly, even more so when you consider that owning runs, based on my preliminary estimates, about $60-$100/hr (depending on type, cost of gas, fixed costs broken down to a hourly rate, etc.) In addition because of the increasing shortage of instructors makes being able to get lessons scheduled so as to get things done in a timely fashion all the more important. Lastly is the fact that by owning I get the advantage of the equity, something I won't get by renting.

 

On 11/23/2016 at 8:26 PM, AndyFromCB said:

Here is the deal, if you think renting is a money pit, you're not ready to buy an airplane. As simple as that. Be ready to spend 2 times as much owning as renting, maybe 3 to 4 times your first year. Renting is always cheaper, good rule of live by, if it flies, floats and fornicates, rent it, it's cheaper in the long run. You only buy for convenience. I have to disagree with Anthony, there is no such thing as right airplane, unless you buy one from me when I get bored with it (well, and few other members on this board), and then still the 2x rule will still apply. The rest of pilot/owners are CSOBs and you will end up with a money pit. Or you can buy a brand spanking new Turbo 206, with warranty, and still end up writing close to $30K worth of checks your first year fixing various issues because Cessna apparently hires spider monkeys to assemble aircraft but the best attorneys money can buy to write the warranty contract.

See above for part of my response. As for there being no such thing as the "right plane," there is. But the time and cost of designing, building, and testing something from the ground up is a little bit out of the question.

[rbridges]

Just now, Ranger_Chris61 said:

I have to disagree with you on this. For right now I am looking at least another 150-180 hrs to get at least a commercial rating (30 more hours to an instrument rating + 120 for commercial + over runs). At $150/hr to rent that adds up very quickly, even more so when you consider that owning runs, based on my preliminary estimates, about $60-$100/hr (depending on type, cost of gas, fixed costs broken down to a hourly rate, etc.) In addition because of the increasing shortage of instructors makes being able to get lessons scheduled so as to get things done in a timely fashion all the more important. Lastly is the fact that by owning I get the advantage of the equity, something I won't get by renting.

 

 

My mistake. I was only considering through PPL.  I guess that was my knee jerk thought since that question is brought up often. 

[AndyFromCB]

47 minutes ago, Ranger_Chris61 said:

I have to disagree with you on this. For right now I am looking at least another 150-180 hrs to get at least a commercial rating (30 more hours to an instrument rating + 120 for commercial + over runs). At $150/hr to rent that adds up very quickly, even more so when you consider that owning runs, based on my preliminary estimates, about $60-$100/hr (depending on type, cost of gas, fixed costs broken down to a hourly rate, etc.) In addition because of the increasing shortage of instructors makes being able to get lessons scheduled so as to get things done in a timely fashion all the more important. Lastly is the fact that by owning I get the advantage of the equity, something I won't get by renting.

 

See above for part of my response. As for there being no such thing as the "right plane," there is. But the time and cost of designing, building, and testing something from the ground up is a little bit out of the question.

60 to 100 dollars an hour? Not to burst your bubble, but triple it...

At 150 an hour, at worst you're in for $27,000. One oil change can cost you twice as much when you find out the engine just ate a camshaft, but let's say you get lucky and you have no major catastrophic failures. Let's look at some numbers and consider you're living in CA, not exactly a low cost state, assuming you buy a decent airplane and you run into the usual expenses of maintaining an older, gear swinging aircraft.

First of all, if you spend $100,000 on the aircraft, well, let's say the economy takes a shit. You can be out of $50K pretty damn quickly. Or mooney closes its doors one last final time (not unlikely, considering how they are not selling any airplanes, because nobody in their right mind will spend $800K when Cirrus/Piper Mirage exists)

You'll be spending $7.5K on sales tax in PRCA, so there is $40 an hour alone (calculated on 180 hours total usage).

You borrow $80K, put $20K down, you'll be paying $4.5K in interest alone, so there $25 an hour

You will pay around $1.5K in insurance your first year, there is $8 an hour

Add another $1K for various navigation databases, XM weather, etc, there is $5 an hour

Add 4 oil changes (you said you won't have a hangar, hard to do on a ramp, probably not allowed), $1K, there is $5 an hour

Add basic annual nothing major breaking down $2K, there is $10 an hour

Add another $2K for when things break down (and they will, this number is the lowest you can expect to spend), look up how much a battery costs and see how long they last baking in the sun, there is $10 an hour.

You're over $100 an hour before you even put fuel in there, assuming nothing breaks down. Now look up some parts prices for vacuum pumps, gyros, avionics break downs, etc. Look up for a fuel pump costs.

By the time all is said and done, without any major failure, if you fly 180 hours in a year, you will be most likely looking at $200 an hour for a $100K aircraft.

Move on up in the food chain and start thinking $300 an hour for any of the turboed birds.

No trying to scare you, but you need to be realistic. I find with fuel around $6 a gallon, triple for a single, 4 times for a twin gives you a good number without major failure.

 

Edited November 27, 2016 by AndyFromCB

[carusoam]

Andy,

using your math methodology, what's the hourly cost for the turbine single? (Without the pilot if possible)

Best regards,

-a-

 

[AndyFromCB]

5 year old TBM 850 ($2.5 purchase price) will run you about $200K a year before putting fuel into it. Add another $200 per hour for fuel. This does not includes sales tax, but it does include interest, insurance, hangar and maintenance. 

Personally, I'd rather fly the baby king air with Blackhawks. No matter what anyone says, maintenance is identical between two birds (lots of used KA90 parts around, not so with Socata and you can price shop gear overhauls, etc), the big block turbine costs about twice as much as two small turbines for reserves, rest of the systems are pretty much identical, you get a potty and can buy one for million and half less, so interest payments at least half as much. And if you lose one, you can hang at FL190 at gross while TBM becomes a space shuttle. TBM with an engine out is not a PC12 or Meridian. It's a very, very unforgiving bird. Other than sheer speed/range, it makes no sense whatsoever. 

And with TBM you cannot get away renting a smaller hangar because the rudder is so damn tall, so you might as well fill it up with a KA90 ;-) My old company sold it and got a KA350 and actually saved money.

Me, I'm back to being semi retired for a while (quit/sold out/got fired, depending on whom you ask), so I'm back in the piston world with a Turbo 206. After putting VGs on it, I love it.

Edited November 27, 2016 by AndyFromCB

[AndyFromCB]

I also see you mentioned building equity in an airplane. Now you're just being silly.

[dera]

Andy, do you actually own an airplane?

 

[AndyFromCB]

1 minute ago, dera said:

Andy, do you actually own an airplane?

 

No, but I'm making payments on one.

[Ranger_Chris61]

1 hour ago, AndyFromCB said:

You'll be spending $7.5K on sales tax in PRCA, so there is $40 an hour alone (calculated on 180 hours total usage).

That is assuming I buy in CA. It is well within the realm of reason that I will buy out of state. Which mean I potential may be able to get around this through flyaway exemption to taxation. However I openly admit I am not versed enough in this area to say that I will be able to do this. Thank you for bring this up as it was something I had forgot to bring up in my initial questioning. While I do acknowledge sales tax is a cost, however it is not a recurring cost which is where I cam doing my per hour value comparison. There is in CA a 1% luxury tax that I will have to deal with however, and using your $100k example equates to $6/hr

1 hour ago, AndyFromCB said:

You borrow $80K, put $20K down, you'll be paying $4.5K in interest alone, so there $25 an hour

This is assuming I get a $100k aircraft, something which I would like to avoid. My personal comfort zone is not more than $75k, with the begrudging willingness to go higher should I find something that is worth the additional cost. Whats more this is something I will be paying regardless of how much I fly so is calculated over the course of the year so its over the course of the year, not just the 180 hours. Still using your example on a 20 year $80k loan at 5% that is $530 per month or $0.72/hr

1 hour ago, AndyFromCB said:

You will pay around $1.5K in insurance your first year, there is $8 an hour

Had estimated higher on this, thinking that it would run between $2k-$3k (for calculations splitting the difference at $2.5k) giving $0.29/hr over the course of the year.

1 hour ago, AndyFromCB said:

Add another $1K for various navigation databases, XM weather, etc, there is $5 an hour

This amount I am assuming you pulled off of Garmin's site. The problem with it is that it is for Garmin's newer avionics, the 650 and 750. Most of the aircraft I have looked at all have the 430, with Garmin no longer supports but Jeppesen does. Their subscription, based off a forum post from a different site was $350 (if that has changed please let me know) for the entirety of the US for the year, working out to $0.04/hr. As for XM weather if I get something that has ADS-B in that is complementary, else I will simply do without.

1 hour ago, AndyFromCB said:

Add 4 oil changes (you said you won't have a hangar, hard to do on a ramp, probably not allowed), $1K, there is $5 an hour

Fair enough, one of the things I had wanted to find out about in terms of the difference between getting a hanger or a tie down so thank you for bring this up as well. I would also assume that an oil change is something that can be done owner assisted so as to save a little, any info as to the difference in cost would be appreciated.

1 hour ago, AndyFromCB said:

Add basic annual nothing major breaking down $2K, there is $10 an hour

Same number I had estimated with, but since it is good for the year priced at $0.23/hr

1 hour ago, AndyFromCB said:

Add another $2K for when things break down (and they will, this number is the lowest you can expect to spend), look up how much a battery costs and see how long they last baking in the sun, there is $10 an hour.

This was one of the reasons that I made this post was to try to get a better idea of what the repair cost are and what items tend to fail most often.

So adding all of those costs together gets $22.28/hr of cost before gas. In my area cost of self serve usually runs between $5 and $5.50. So sticking with your $100k mooney example, if it is a 4 cylinder figure it will most likely burn about 9/hr on average, working out to $50/hr. If it is a 6 cylinder assume 12/hr on average and costing $66/hr. So for total cost we have between $73/hr and $89/hr, roughly half the cost of renting.

 

59 minutes ago, AndyFromCB said:

I also see you mentioned building equity in an airplane. Now you're just being silly.

Something is always better than nothing

Edited November 27, 2016 by Ranger_Chris61

[AndyFromCB]

How is $530 a month 72 cents an hour? That's 6359 a year? Divided by 180 hours (if you fly that much first year), it's $35 an hour, not 72 cents. And more like 63 an hour if you fly as much as most people who can afford to make this payment do (100 a year or so).

Just for shits and giggles take a look at this invoice if you need an eye opener. This was not any sort of a giant annual, just lots of little things here and there (and was proceeded by about $15K worth of work just a few months before). Most airplanes don't get this kind of open checkbook maintenance, especially ones for sale so the deferred maintenance will catch up with you, the new owner.

http://www.riskmt.com/n767rd/other/Annual2012.pdf

You're not building any equity, it's a depreciating asset. And you're maintaining a 500K aircraft with new parts priced correspondingly. 

Edited November 27, 2016 by AndyFromCB

[dera]

Just now, AndyFromCB said:

How is $530 a month 72 cents an hour? That's 6359 a year? Divided by 180 hours (if you fly that much first year), it's $35 an hour, not 72 cents. And more like 63 an hour if you fly as much as most people who can afford to make this payment do (100 a year or so).

Just for shits and giggles take a look at this invoice if you need an eye opener. This was not any sort of a giant annual, just lots of little things here and there:

http://www.riskmt.com/n767rd/other/Annual2012.pdf

You're not building any equity, it's a depreciating asset.

Get real?

You just found a massive verging-on-ripoff-annual and use that as an example?

" Problem: Wastegate heat shield chaffed into engine mount. Action Taken: Removed and reinstalled engine mount P/N 590047-501 S/N 150014 after repair by AWI. See FAA Form 8130-3 dated 12-7- 2012. Work done referencing Mooney M20M Maintenance Manual chapter 71. Trimmed heat shield to eliminate contact with engine mount."

50 hours? Ok....

 

[Ranger_Chris61]

2 minutes ago, AndyFromCB said:

How is $530 a month 72 cents an hour? That's 6359 a year? Divided by 180 hours (if you fly that much first year), it's $35 an hour, not 72 cents. And more like 63 an hour if you fly as much as most people who can afford to make this payment do (100 a year or so).

Its a fixed cost, so I am going to have to pay it regardless of how much I do or don't fly. Hence the 6359 a year breaking down to 72 cents a hour.

6 minutes ago, AndyFromCB said:

Just for shits and giggles take a look at this invoice if you need an eye opener. This was not any sort of a giant annual, just lots of little things here and there (and was proceeded by about $15K worth of work just a few months before). Most airplanes don't get this kind of open checkbook maintenance, especially ones for sale so the deferred maintenance will catch up with you, the new owner.

http://www.riskmt.com/n767rd/other/Annual2012.pdf

Yea that looks like a bad run of luck there to get all of that to hit at the same time. So I do have to ask though in regards to deferred maintenance would not a lot if not all of this be caught on the prebuy, allowing me to either have these items fixed prior to taking delivery or getting the cost of the maintenance taken of the purchase price.

Reading through that I noticed that you were able to supply some of the parts yourself, how much if any were you able to save getting the parts yourself vs. the mechanic hunting them down?

[AndyFromCB]

1 hour ago, dera said:

Get real?

You just found a massive verging-on-ripoff-annual and use that as an example?

" Problem: Wastegate heat shield chaffed into engine mount. Action Taken: Removed and reinstalled engine mount P/N 590047-501 S/N 150014 after repair by AWI. See FAA Form 8130-3 dated 12-7- 2012. Work done referencing Mooney M20M Maintenance Manual chapter 71. Trimmed heat shield to eliminate contact with engine mount."

50 hours? Ok....

 

No, 

You just found a ton of airplanes that are not airworthy. That engine mount was in a bad shape, a known M20M problem, most keep on flying like that. I keep my aircraft in compliance with TC. And TC allows for 10% of tube thickness and no more.

 

And 50 hours for engine R&R, plus engine mount R&R is far from excessive, actually fairly reasonable. Ever tried putting together Bravo's exhaust? You can spend 2 days on that alone. You sound like someone who never turned a wrench on an aircraft. 

 

How quickly can you R&R engine, mount and landing gear components attached to said mount.

 

Here you go, here is CA shop prices for engine R&R (does not include engine mount R&R)

http://www.victor-aviation.com/Engine_Removal.php

Looks like I got quite a bargain

Edited November 27, 2016 by AndyFromCB

[AndyFromCB]

72 cents a what hour? Sitting on the ground, 356/24 a day? Are you smoking some of that good CA weed? By that factor, you should buy Gulfstream, I mean that rental at 150 an hour is costing you 1.3 million a year. At least compare apples to apples.

Edited November 27, 2016 by AndyFromCB

[Ranger_Chris61]

Just now, AndyFromCB said:

72 cents a what hour? Are you smoking some of that good CA weed?

530*12 = $6360 a year

6360/(365*24) = .72/hr

[AndyFromCB]

Just now, Ranger_Chris61 said:

Its a fixed cost, so I am going to have to pay it regardless of how much I do or don't fly. Hence the 6359 a year breaking down to 72 cents a hour.

Yea that looks like a bad run of luck there to get all of that to hit at the same time. So I do have to ask though in regards to deferred maintenance would not a lot if not all of this be caught on the prebuy, allowing me to either have these items fixed prior to taking delivery or getting the cost of the maintenance taken of the purchase price.

Reading through that I noticed that you were able to supply some of the parts yourself, how much if any were you able to save getting the parts yourself vs. the mechanic hunting them down?

No savings at all, mechanic simply could not find them, Mooney factory was out business at that time.

[Ranger_Chris61]

Just now, AndyFromCB said:

You just found a ton of airplanes that are not airworthy. That engine mount was in a bad shape, a known M20M problem, most keep on flying like that. I keep my aircraft in compliance with TC. And TC allows for 10% of tube thickness and no more.

Know m20Ms are out of my price range, but good to know.

[AndyFromCB]

Just now, Ranger_Chris61 said:

530*12 = $6360 a year

6360/(365*24) = .72/hr

Well, by that calculation, buy a Gulfstream. You're trying to save money compared to renting, so compare flying hour to flying hour, rented vs owned.

[AndyFromCB]

6 minutes ago, Ranger_Chris61 said:

Know m20Ms are out of my price range, but good to know.

Each and every aircraft you will find will have an un airworthy engine mount. I have never seen one that was not chafed somewhere beyond limits. Most mechanics don't care. It does not mean the airplane is airworthy or that I would fly it. Will it matter on most flights no? Will it matter when you hit a gust over Red Table mountain, hit 5Gs, lose your engine and tail spin into the ground. It mattered to me. Like I said, most pilots are CSOBs.

As to finding these things on probuys, you might, you may not. Good luck getting sellers of $75K aircraft spending $50K it would cost to get them airworthy, really airworthy.

Also, don't forget, unless you annual each aircraft and pay for it, prebuys are not that in depth, so you might do 5 to 7 annuals before you find your bird, so there goes another $10K to $14K. Get back to me after a year and tell me how much that first 100 hours set you back.

Edited November 27, 2016 by AndyFromCB

[dera]

I've saved thousands and thousands by owning my plane. Don't listen to the naysayers. If you can afford it, go for it. Renting is insane.

 

 

[Ranger_Chris61]

4 minutes ago, AndyFromCB said:

Well, by that calculation, buy a Gulfstream. You're trying to save money compared to renting, so compare flying hour to flying hour, rented vs owned.

Except the fixed cost must be paid even if I don't fly at all, and is why they need to be calculated over a year and not just the 180 hours of flying. It would be nice to not have to pay for fixed costs by not flying but they still exist.

Also screw a gulstream, for that kind of money I would rather get a mig.

Edited November 27, 2016 by Ranger_Chris61

[AndyFromCB]

49 minutes ago, dera said:

I've saved thousands and thousands by owning my plane. Don't listen to the naysayers. If you can afford it, go for it. Renting is insane.

 

 

Spreadsheets or didn't happen, because I know it didn't happen unless you fly around 300 hours a year or so, closer to 600 actually. Did you take engine reserves into account? Of course not, what is it to overhaul an IO360 these days, $50K with R&R and accessories. That's another $25 an hour if your Lycoming doesn't eat your camshaft first. Never meet a private owner where a camshaft made TBO. Flight schools yes, private owners, almost never. So most engines get yanked out at least once during ownership, there goes another $10K to $15K depending on the issue. 

100 hours a year at $150 an hour is $15,000.

The poster is already into that with sales tax (that he somehow thinks he will avoid), luxury tax, payments, insurance and annual.

That's without an hour of flying, an hour of maintenance, etc.

I'm not saying don't own, I'm saying don't do it to save money because you will not. Show me your spreadsheets, and not the ones you show to your spouse. If you don't have spreadsheets, you don't know what you are talking about. I have them for 6 aircraft (4 pistons, 2 turboprops), charter would have been considerably cheaper. Only way to save money is to turn the wrench yourself, but that only makes sense if you make less than what your mechanic charges. If you do, then you can't afford the payments. I'm sitting here dealing with a crying kid in the middle of the night, last thing I want to be doing tomorrow is turning wrenches on my plane. Does your airplane have an autopilot? Show me your invoices just for that piece of equipment, because I know precisely to a penny that keeping a KFC150/200/225 unit going runs about another 25 an hour if you add up all overhauls on gyros, servos and head units. Everything needs overhauling at least once every 500 to 800 hours. $2500 a piece for gyro, hsi and 3 servos. If you head unit dies, well, how about cutting another check for $15K. Now, if it's a TBM, make that $60K for the KFC325. So unless you're flying a basic 172, you're either lying to yourself, or turning your own wrenches on a C, E or F with no avionics.

Sold your airplane yet? How much is that going to cost you purchase price - sale price - $ opportunity cost. This isn't the 80s and 90s anymore, aircraft actually lose value with time due to ever growing Cirrus fleet.

 

Here you go, here is CA shop prices for engine R&R (does not include engine mount R&R)

http://www.victor-aviation.com/Engine_Removal.php

Looks like I got quite a bargain

Edited November 27, 2016 by AndyFromCB

[ArtVandelay]

Never met an owner who made TBO?

$25/hr for AP maintenance? 

... I haven't owned my plane long enough to have personal experience but you're the first to mention these horrific maintenance issues as business as usual.

[Hank]

20 minutes ago, teejayevans said:

Never met an owner who made TBO?

$25/hr for AP maintenance? 

... I haven't owned my plane long enough to have personal experience but you're the first to mention these horrific maintenance issues as business as usual.

That's because ha practices "open checkbook maintenance," and his shop knows it . . .

I had to overhaul one of my Brittain aileron servos a couple of years ago, it cost me $135 plus shipping to Tulsa, and about an hour of my small-handed A&P's time--I couldn't get my hand into the back if the wing. In the last nine years, I've replaced the encoder on my altimeter twice, overhauled the DG once, resealed the tanks, replaced the pucks, and had an arm to a front gear door break. Other than gas, oil, tires and batteries, that's it. Sure, a new Concorde battery is $300-350, but mine lasted almost seven years 

I did have one bad annual when I moved and had no contacts. I didn't go back, not because it ran 6 AMU but because he didn't do what I asked him to do. My last annual was $850, owner assisted, in line with what I've been used used to paying.

[Hank]

I divide my expenses into Fixed and Operating expenses. Trying to figure out how much my GPS database will cost per flight hour is ridiculous--it costs $500 whether I crank up the engine or not, so the hourly price can be infinite if I don't fly or $5/hr for my typical,year. But flying more hours in the year, like when working on my instrument rating, brings the "hourly cost" down without changing how much I paid, because the expense isn't related to how many hours I fly. Same for the annual, hangar rent, insurance, etc.

Operating expenses are what I spend directly related to operating the plane:  fuel, oil, tires, battery, etc. I do my own oil changes, so it's just seven quarts ($56) and a filter ($25). The local auto parts place accepts used oil at no charge. Even when adding tires, tubes, batteries, etc., double the gas price is about right. Here it varies $3.20 to $3.55 for avgas, and I run 9 gph; at $3.50 that's $31.50/hr, so call my Operating Expenses $63/hr. If I fly more hours, my expenses stay the same per hour but the amount paid increases.

Since my plane is paid for (yay!), there's no interest to deal with, but really, the Credit Union where I financed the second half of the plane gave me a really good deal anyway. It is nice, though, that my five year loan is paid off, even though I moved to the land of pricey hangars (Alabama hangars cost double what WV hangars run, but still less than half of south Florida; no idea what hangars run in the People's Republic of Kalifornia).

Good Mooneys are available in the $50-$70K range that won't require large additional investments. Some interiors are dated but in good shape; some paint schemes are less attractive; some paint is in rough shape. If your goal is to obtain additional ratings and experience then sell the plane, ignore these cosmetic issues as long as it's in good shape, then sell the plane. It will reduce the purchase price, but also the selling price, and will let the new owner fix things up the way they like.