Rule of thumb?

[GaryP1007]

Is there a rule of thumb relative to discounting the asking price of a plane listing? 5% -10%. Of course I'm assuming the list price is in the right ballpark to start.

 

 

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[KLRDMD]

Just now, GaryP1007 said:

s there a rule of thumb relative to discounting the asking price of a plane listing? 5% -10%. Of course I'm assuming the list price is in the right ballpark to start.

If the price is in the right ballpark why would any discount be expected ?

[Yooper Rocketman]

I think it all really goes on market and value. I've sold 2 airplanes for exactly my asking price (while a negotiator lost out getting the plane he really wanted).  Two of the 3 planes I've bought personally were for asking price and one for about 6% under asking price.  You need to have a real good feel for the circumstances surrounding the sale to know if you can negotiate the price or need just lock up the sale before losing it.  

Tom

[dlthig]

Because we're pilots. I was at work talking to an engineer. He was sharing stories of cheap pilots. I asked him if he was going to finish his coffee. He laughed, but did bring his cup a little closer.

[ArtVandelay]

There is no rule of thumb, my advice is to narrow your search to a particular model, and any must haves for you to consider it. Then constantly check various sites, makes notes of any that fit your search requirements. Keep doing this, it will give a feel for what's a good price and when see a plane drop in price that is a clue the seller is motivated.
Sometimes they get listed for a good price right from the start, these don't last long, and can sell within days. If you have done your homework you'll realize it's a good buy and be ready to jump on it.

[gsengle]

My impression having bought a couple of planes, is that deals are seldom to be had. The best bet for used aircraft is to find one that has been well loved, and don't try and find too much of a bargain. A bargain plane can really bite you later if things are missed on inspection... pay a fair price, and move forward.

Some people overprice, make a fair offer and if they don't accept, just move on.


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[Mooneymite]

If your offer is accepted, you obviously offered way too much.  

[gsxrpilot]

Here's a very simple and maybe counterintuitive formula for getting a good deal on an airplane.  

1. Choose a model that you like.
2. Buy the most expensive example of that model. If you can't afford the most expensive example, choose a different model.

While overly simplistic, it is somewhat true. I'd fine tune this formula by saying to buy the best condition, best equipped, best panel, best engine, etc that you can find in the model you're after. Do that and 2 years down the road, you'll realize you got the best deal.

[Zwaustin]

What Paul said.... I have done this twice now and while I paid premium dollar I got a very premium example and pedigree. I have been very happy with my 231 and my twin Cessna 421C. 

[carusoam]

Use the rule of thumb for pricing a plane...

But this time, reverse the order...

If you are buying from a professional sales guy, you know he has some leeway built in to a competitive price.

If you are buying from a guy that sells a plane every decade or two, he may not even know what the price should be...

There is always plenty of room for negotiation...

there is plenty of time to decide...

Until, there is just one other person looking to do the same thing you are.

Suddenly, the rules change...

The time to negotiate is when everyone is selling...

Buy straw hats in the middle of winter.  Buy winter coats in the middle of summer.  End of season sales are really good.

Last I looked there are no rules for pricing airplane's for sale.

 

The rule of thumb that I Have seen around here is your first plane that you try to buy gets away before you get serious.

After that happens, you know exactly what you want and how much you are willing to pay to get it...  negotiations go into high speed mode right after that moment.

There is a guideline for pre-owned Mooney prices.   It is printed in a good Mooney Newsletter that gets mentioned around here often.  The guideline is put together by the people that sell Mooney's at All American Aircraft.

Never give away the opportunity to use a PPI...  even expensive newish planes need a PPI...

Best regards,

-a-

Edited February 19, 2017 by carusoam

[KLRDMD]

1 hour ago, carusoam said:

Never give away the opportunity to use a PPI...  even expensive newish planes need a PPI...

Sometimes they do, sometimes they don't . . .

[Browncbr1]

The basic rule of thumb in aviation is ...  Pay now or pay later.    

[bradp]

Start with vref and massage according to individual circumstances. Try to get a sense of what the market is. If it seems grossly overpriced, offer what you think it's worth. If it's offered where it should be valued, offer that. There aren't many lowball offers that are accepted except for circumstances such as must sell (estate, loss of medical, etc).

Counter example: For instance if my wife says plane must go, I would ask for 35% more than it's worth because I don't want or need to sell. Knowing why the plane is being sold is helpful.


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[M016576]

9 hours ago, KLRDMD said:

Sometimes they do, sometimes they don't . . .

my first J had a PPI- and the next annual was a killer. and for some things that were not caught by the PPI.

My current mooney, I did not have a PPI, and the next annual (the next three annuals) have all been sleepers.  Then again, I also knew what to look for... even as a non A&P you can pick up on some of the bigger ticket items on your own, given enough access to the plane by the owner.

 

That said, though- the going in game-plan for a PPI is a very sound one- particularly if the aircraft is over 5 years old

Also... if you think you're getting a good deal- you probably are missing something (reference the first J I listed above).  That was well below market price... I thought I was getting a great deal.  I was wrong.  I paid more over the following years bringing it up to the level I wanted than just buying a cherry right off the bat.  I didn't make that mistake the second time around, thankfully.