State of single engine prices - Thoughts?

[WildBlue]

I’m wondering if anybody has thoughts on rising prices of single engines like Mooney’s. 
 

When I first started shopping for smaller single engines back in ‘17 (e.g. Pipers before I discovered Mooney’s improved performance), they seemed more reasonably priced than ones I see today. When I compare today’s Mooney prices to when I first started looking in ‘20, they seem to have risen with the housing market bubble. It seems unreasonable to take the plunge these days. 
 

Any thoughts?

Edited December 29, 2022 by WildBlue

[Guest]

You have to remember that Mooney pilots are wrecking them at a terrific rate.  Supply and demand is doing it’s part on pricing. 

[larryb]

Another thing to remember is that over time the purchase price is a small part of the overall ownership cost. It's not uncommon to spend 20% to 30% of that purchase price every year to fly and maintain the airplane. 

[A64Pilot]

Most don’t but I agree with you, prices of most anything luxury wise is a bubble, one that this economy will correct, the longer it takes to correct the more the prices will drop.

I hope it won’t be the 1980’s again but I suspect it may be close. Prices of any luxury items bottomed out as with interest rates in the teens who could afford to buy? 

https://en.wikipedia.org/wiki/Early_1980s_recession

People say it’s not the same now, there is almost no unemployment, but that’s not true. It’s how we count unemployment is why.

If you can I’d wait, but if you plan on borrowing money to buy, maybe you should have bought a year ago, cause it’s no likely money will get cheaper anytime soon.

[RobertGary1]

It varies wildly with the amount economy. A small slow down will cause a big price drop. 

[A64Pilot]

17 minutes ago, RobertGary1 said:

It varies wildly with the amount economy. A small slow down will cause a big price drop. 

Can you expand on that? I don’t understand 

[RobertGary1]

40 minutes ago, A64Pilot said:

Can you expand on that? I don’t understand 

When the economy slows down people keep their houses and dump their airplanes. The economy has been strong so airplane prices have risen. 

[hubcap]

1 hour ago, A64Pilot said:

Most don’t but I agree with you, prices of most anything luxury wise is a bubble, one that this economy will correct, the longer it takes to correct the more the prices will drop.

I hope it won’t be the 1980’s again but I suspect it may be close. Prices of any luxury items bottomed out as with interest rates in the teens who could afford to buy? 

https://en.wikipedia.org/wiki/Early_1980s_recession

People say it’s not the same now, there is almost no unemployment, but that’s not true. It’s how we count unemployment is why.

If you can I’d wait, but if you plan on borrowing money to buy, maybe you should have bought a year ago, cause it’s no likely money will get cheaper anytime soon.

I believe the fallacy when comparing GA planes to the housing market is that fewer planes are coming into the market every year than are being retired. In other words, the number of light GA planes is actually going down or at the most optimistic is staying the same.

[A64Pilot]

Curious, with the market dropping over 25% and inflation higher than anytime since the 80’s, your opinion is these are markers for a strong economy.

To me this doesn’t seem like a rosy forecast and it’s a reputable link one I don’t think is polluted with politics

https://www.schwab.com/learn/story/market-volatility

I think it’s not, but many haven’t realized that as most media is pushing the idea of a strong economy.

A huge amount had to do with general public beliefs and trust, get people worried and revenue if the economy is strong there will be trouble, the converse is also true.

But eventually the King does realize he has no clothes

[hubcap]

4 minutes ago, A64Pilot said:

Curious, with the market dropping over 25% and inflation higher than anytime since the 80’s, your opinion is these are markers for a strong economy.

To me this doesn’t seem like a rosy forecast and it’s a reputable link one I don’t think is polluted with politics

https://www.schwab.com/learn/story/market-volatility

I think it’s not, but many haven’t realized that as most media is pushing the idea of a strong economy.

A huge amount had to do with general public beliefs and trust, get people worried and revenue if the economy is strong there will be trouble, the converse is also true.

But eventually the King does realize he has no clothes

No. You put a whole lot of words in my mouth that I did not say. 

I did not say anything about the economy. I simply said the supply of light GA airplanes is probably going down but in any case the supply is not increasing. 

You are on a completely different subject.

[A64Pilot]

15 minutes ago, hubcap said:

I believe the fallacy when comparing GA planes to the housing market is that fewer planes are coming into the market every year than are being retired. In other words, the number of light GA planes is actually going down or at the most optimistic is staying the same.

That’s been true at least for the last 40 years, nothing new there. But you’re definitely correct the number of light piston GA is definitely declining, no question about that. 

I don’t think anyone could make an intelligent argument that the number isn’t declining every year.

But it’s not new, it’s been declining for a LONG time.

I’m not so much comparing GA aircraft to housing market as I am to any luxury item, like vacation homes, boats, RV’s, everything you don’t have to own, but want to own.

I think just like every recession I remember prices for those will plummet.

I bought a boat after the recession of 08, after closing the Broker made the statement to me that all the closing he attends now, two checks are written. Being dense I didn’t understand so I asked, his response buyer wrote one check, then the seller wrote another one to put with the buyers to pay off the boat.

In 09 or so you could buy a Nice boat for half what it cost in 07. Bought my 140 same year I think for a song, airplanes just weren’t selling, people were scared of losing the house, and many did, when that happens they dump everything they can for what they can get for it.

I was a kind in the early 80’s, joined the Army is 82 because the oilfield shut down and there were zero jobs to be had. I was a welder and there were many unemployed welders then

[A64Pilot]

10 minutes ago, hubcap said:

 

You are on a completely different subject.

That’s because that response was to RobertGary and not to you.

‘But the number of aircraft has been decreasing for 40 years and even though it has it’s not protected prices before

[Scott Ashton]

I bought my 201 in august after shopping for both 201s and 182Ts.   I probably bought at the top of the market, but got a really good plane what was well taken care of.   Every time I park the plane, I look back at it and think “I love it more than even the last time I flew it!”   I am not sure I would be doing that if I had bought the Skylane.   And a 20% drop in the 201 value is a lot less than the same percentage in a 182.    Plus with the bonus depreciation this year it made waiting for the market to drop a non issue.

[A64Pilot]

The reason why we as an average pilot population are flying older aircraft every year on average is because the number of new ones is quite small. In the 70’s when I was flying with my Father 5 years was an older airplane, an ancient one was 10 years old.

You can get different numbers but this says average age of GA fleet is 50 yrs old. 15 years or so back I found that the average GA airplane was a 1977 model

https://generalaviationnews.com/2019/05/27/aging-pilots-aging-airplanes/

[good2eat]

There is one thing that is different than in the past.  TSA and the pain associated with commercial air travel drive us to purchase a plane.  Traveling in your own  plane, on your own schedule and being able to keep your shoes on has significant value.  
 

I’ve spoken with many new and new-ish owners and nearly all say something along these lines.

I’m not saying this will, in and of itself, keep prices from declining during economic slow downs, but I would say the price could have less downward pressure as a result.

 

[A64Pilot]

4 minutes ago, Scott Ashton said:

I bought my 201 in august after shopping for both 201s and 182Ts.   I probably bought at the top of the market, but got a really good plane what was well taken care of.   Every time I park the plane, I look back at it and think “I love it more than even the last time I flew it!”   I am not sure I would be doing that if I had bought the Skylane.   And a 20% drop in the 201 value is a lot less than the same percentage in a 182.    Plus with the bonus depreciation this year it made waiting for the market to drop a non issue.

I don’t think prices have really declined much have they? I bought myself two years ago, but I’m probably older than you too and waiting a couple of years to get a better price would be two years less that I have left. I hate to think about it but it’s likely I’ll be hanging my wings up in ten years or so, possibly less.

So yes sometimes there are other considerations to buying, but I feel especially for someone younger than me looking to but their first airplane may be better served to wait a year or so.

[A64Pilot]

6 minutes ago, good2eat said:

There is one thing that is different than in the past.  TSA and the pain associated with commercial air travel drive us to purchase a plane.  Traveling in your own  plane, on your own schedule and being able to keep your shoes on has significant value.  
 

I’ve spoken with many new and new-ish owners and nearly all say something along these lines.

I’m not saying this will, in and of itself, keep prices from declining during economic slow downs, but I would say the price could have less downward pressure as a result.

 

Yeah a few years ago airlines became the Greyhound bus, it’s not at all what it used to be even a few years ago, yes you can fly business and that helps once on the airplane and yes you can sit in one of the lounges for business class, but that doesn’t help with TSA and everything else, you still go through the herd to get to that lounge.

‘I despise Commercial airlines, look at what’s happening right now with SouthWest. But TDA became a pain in 2001, 21 years ago, thsts not new either, not getting better, but not new, and it didn’t help airplane prices after 08.

[Tommooney]

Its all time relative.

I bought my Ovation new in Sept 2003 for list price $399K with 10% down and 6% interest on a 15 year loan . It seemed like a huge amount of money then, compared to previously had a cherry twin commanche that I bought $45K 1987 and sold for $45K in 1992.  The Ovation is paid off now. I have no regrets and a great experience buying the best plane I could afford for commuting from SoCal home and business to my farm in OTH OR. It seldom has needed repairs between annuals. Unlike the many talented mechanical types on here, I don't do my own maintenance. I don't trust myself going there. I go to MSCs for annuals. It has never left me stranded.

If buying a forever plane looking 20 years out, I recommend the newest , lowest hour plane you can find. I believe you will not regret the money,      but I do now regret selling that  twin commanche N7825Y for $45K.....( it broke a lot and parts were hard to get fast back then. )

Out of owning 4 planes in 45 years , I have not sold any of them for less than I paid.

Good luck out there.

Tom

 

[Scott Ashton]

Yeah I guess my point is that even in a decline, the Mooney stings less than a Cirrus or a newer 182 as the market retracts.   I agree with you that as long as you aren’t paying stupid money, if you need an airplane, then buy it.   I figured if not now, then when would it be?   I’ve been flying since I was 17 and if I own the airplane for 10 years, I probably would never remember how much I had paid for it.   
 

now, the 200 hour private pilot spending 1.3MM for a new cirrus?   I think they are in for some hurt….

[DCarlton]

There are a lot more Mooney's, particularly older ones, that are on the market right now than there were a few months ago.  I don't think planes are selling in days any more unless they are really aggressively priced.  Perhaps there will be some price correction or at least an opportunity to shop carefully.  Yep they leaped up in price the last couple of years.  What was $120K is now $180K.  

[philiplane]

Yes, the number of planes is shrinking, but the number of owners is also shrinking, so there is no real support for the current pricing. It will decline rapidly next year as the recession takes hold. Inflated asset prices of all types will drop. 

[A64Pilot]

A with anything if your in long term it’s likely things will be cyclical, after 08 small aircraft manufacturing plummeted and has never recovered but price of new aircraft essentially doubled right after 08, supply and demand I guess.

So if you can hold on and ride it out you won’t be hurt, just I feel that buying now is buying right at the end of the top of the market, ai just think you can get better for less in a year, two tops. If prices don’t come down sharply in 23 then I’m wrong.

Trust me, I want to be wrong, really, really want the market to recover. What I lost I could have bought an Ovation or something similar.

But I feel the market is a precursor for what’s coming, the Market always tanks before a recession, usually it actually performs pretty good in a recession, the big loss come before. The 08 crash only took 18 months to recover. I’ve not seen any recovery yet and it’s been awhile 

[Fly Boomer]

Remember this?

 

[larryb]

If a piston single is too expensive then just buy a piston twin.

[PT20J]

Seems to me that if all the people who were so sure about their predictions for the future of the economy consistently acted on their beliefs -- and were right -- they'd all be rich. So, why aren't they?

The truth is that no one really knows the future for certain, and timing a market is a fools errand. Time itself is the great equalizer. In the long term, prices tend to increase.

When the economy takes a downturn, who sells their airplanes? Those who probably couldn't really afford them anyway. So, are those going to be the best cared for, cream of the crop kind of airplane you want to own? Or, are you going to get a bargain-priced airplane that will cost an arm and leg to fix all the deferred maintenance items?

Sure, everyone wants a great deal. But, the hardest thing to find is a good solid airframe. You're looking for the proverbial needle in a haystack of ill cared for machines. When you find one, and can get it for a fair price in whatever the current market conditions are, that's the one you want to buy.

At least that's what has worked for me.

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