State of single engine prices - Thoughts?

[0TreeLemur]

On 1/1/2023 at 3:39 AM, EricJ said:

Get a race car and you'll have the trifecta of motor vehicle financial inefficiency.

Better yet, a big John Deere tractor and the farm that goes with it!

[jetdriven]

Planes are expensive but so are iPhone 14s, diesel F350s, brand new Mercedes-Benzes and Tesla Model Y’s. 10 grand a week Air BNB’s at The beach, and when you have that third kid and need a Surburban and a 1.3M house in the McLean school district, or private school.  Makes 20 grand a year for a plane look cheap.  Right along with my paid off 09 3-series BMW with 150k miles on it. 
There’s plenty of money out there it’s just that people are spending it like crazy. 

[hoot777]

I’d do an annual as a pre buy.  Money well spent

[hais]

Where I live a six pack costs $30. The regulator says I need at least 8 hours from throttle to bottle. I fly daily. So the airplane saves me about $6000 annually in beer cost - practically pays for itself

[Guest]

1 hour ago, hais said:

Where I live a six pack costs $30. The regulator says I need at least 8 hours from throttle to bottle. I fly daily. So the airplane saves me about $6000 annually in beer cost - practically pays for itself

The regulator changed it to 12 hours, so you’ll save even more on beer now.

[Pinecone]

10 hours ago, hoot777 said:

I’d do an annual as a pre buy.  Money well spent

So, if it doesn't work out, you have paid for and given the owner a free annual.

Better is to do the pre-buy inspection, but not close it up.  If the deal goes forward, finish the annual for YOU.

[Greg Ellis]

9 hours ago, hais said:

The regulator says I need at least 8 hours from throttle to bottle.

I only need a minute or two from throttle to bottle...however, I still need 8 hours from Bottle to throttle...

[A64Pilot]

31 minutes ago, Pinecone said:

So, if it doesn't work out, you have paid for and given the owner a free annual.

Better is to do the pre-buy inspection, but not close it up.  If the deal goes forward, finish the annual for YOU.

We are saying the same thing, who does a pre-buy without an agreed sale AND price before starting the pre-buy?

You’re paying for the Annual, so it is for you. 99 times out of 100 any serious defect will be found before the Annual is near complete, most any IA does the inspections first then goes onto the servicing.

‘Once a serious defect is found the owner will get that in writing if they complete the Annual, so they aren’t going to want the Annual completed most likely, depends frankly how honest they are.

As an IA if I do not complete the Annual, and therefore don’t make the maintenance record entry of annual completed a list of discrepancies given to owner. 

If the pre-buy goes well you buy the airplane, if the pre-buy / Annual goes well you buy the airplane, what’s the difference?

Any honest seller won’t mind you doing an Annual, they know they have a good airplane.

I don’t worry so much about an agreement about who is going to pay for defects as I don’t believe they work, if it’s nickel and dime stuff I’ll pay, if it’s tens of thousands of dollars the seller isn’t going to pay anyway. Either of you have the right to walk.

If you find significant defects that’s not nickel and dime you tell the seller that you’ll buy less the price to fix the defects, and if it’s big enough money you walk or you agree on a new price.

Then the mechanic who’s fixing it is working for you not the seller who will of course will take the cheapest way out. Example you may have s weak cylinder Seller wants it honed or ring flushed, where you would want it overhauled.

‘Too many threads on this forum on how the pre-buy went fine, but the first Annual discovered serious corrosion etc., which of course didn’t happen in the time between the pre-buy and Annual, so if you buy after a pre-buy, then finish the Annual, anything found during the Annual is your problem, not the sellers.

[Pinecone]

We are saying similar things.

But there is more to an annual that just the inspection.  Lubrication, adjusting things.   I would not do those things (and pay for them) until the final agreement based on anything found during the inspection portion.

[RoundTwo]

28 minutes ago, Pinecone said:

So, if it doesn't work out, you have paid for and given the owner a free annual.

Better is to do the pre-buy inspection, but not close it up.  If the deal goes forward, finish the annual for YOU.

Nothing is an annual until it goes in the logs. If the plane is in annual when it rolls into the shop, it’s still legally in annual until the end of the 12 calendar months from the last annual. Is there anything in the regs that forces someone to proactively declare an aircraft unairworthy if a discrepancy is discovered?
 

The shop that will be doing a Prebuy for me will be using the Mooney annual checklist for the Prebuy and at the conclusion, if the purchase goes through, will sign it off as a fresh annual. If the deal falls through, the plane returns to its owner with nothing noted in the logs.

[A64Pilot]

12 minutes ago, Pinecone said:

We are saying similar things.

But there is more to an annual that just the inspection.  Lubrication, adjusting things.   I would not do those things (and pay for them) until the final agreement based on anything found during the inspection portion.

An Annual IS an inspection it’s not servicing, that why it takes someone with INSPECTION AUTHORIZATION to accomplish one, and that someone must perform the inspection, they cannot delegate nor supervise it, you repack wheel bearings etc to inspect bearings, you change oil because it’s expected, there is no requirement that I’m aware of to change oil.

Wheel bearing repack for example, you can remove and clean them, but I must inspect them, then you can put everything together after I’ve done the inspecting of bearings and races etc.

That’s my interpretation and the way I do Annuals

But I and I expect most IA’s do the airframe inspection first, well actually I do the records inspection first.

But the IA is working for you, let them know you want a THOROUGH inspection and as that will come close to encompassing an Annual, if the airplane looks good, let’s finish the Annual. If they understand the intent is to find defects they will look at the most likely spots first and call you immediately upon finding a show stopper. No point in buying a complete Annual to be told the main spar is seriously corroded.

[RoundTwo]

Since this thread began as a discussion about current market prices, here’s a snip from a VRef done back in October 2022.
 

[A64Pilot]

30 minutes ago, RoundTwo said:

Since this thread began as a discussion about current market prices, here’s a snip from a VRef done back in October 2022.
 

I think you’ll find prices of most durable goods, houses, cars etc pretty much track that graph and I used to say it’s unsustainable, but if inflation continues at a high rate I guess it could devalue the Dollar enough so the prices could remain high, but the actual value of all those things not just aircraft will come down once the pent up demand drops.

But I hope the feds can tamp inflation, and if they do the. the prices will come down, other than a buying spree brought about by I believe largely due to artificially low interest rates, which is no longer true. I bought both a house and a car and financed because of 2% interest. Because I knew eventually I’d need both. I can’t determine anything that will sustain the high prices.

I remember right after the turn of the Century all my friends it seemed thought you couldn’t lose money in a house, actual value of the house wasn’t relevant, it didn’t matter what you paid you were going to get 20% more for it in a few years when you sold it. I knew it would crash, but I had the timing wrong, took years longer than I thought it would.

I knew tech stocks were going to crash too, what made it obvious to me was when I found out that RealEstate.com was valued higher than Delta Airlines yet real estate.com had almost no assets, while Delta had I guess Billions in assets.

But again I was wrong about the timing, it took longer than I thought, these things have a sort of inertia that keeps the prices climbing well after they should have dropped that I don’t understand.

Tesla stock is I think a good example, especially a year ago, there is simply no way the stock was worth what it was selling for, yet people continued to buy.

[Pinecone]

45 minutes ago, A64Pilot said:

An Annual IS an inspection it’s not servicing, that why it takes someone with INSPECTION AUTHORIZATION to accomplish one, and that someone must perform the inspection, they cannot delegate nor supervise it, you repack wheel bearings etc to inspect bearings, you change oil because it’s expected, there is no requirement that I’m aware of to change oil.

Wheel bearing repack for example, you can remove and clean them, but I must inspect them, then you can put everything together after I’ve done the inspecting of bearings and races etc.

That’s my interpretation and the way I do Annuals

But I and I expect most IA’s do the airframe inspection first, well actually I do the records inspection first.

But the IA is working for you, let them know you want a THOROUGH inspection and as that will come close to encompassing an Annual, if the airplane looks good, let’s finish the Annual. If they understand the intent is to find defects they will look at the most likely spots first and call you immediately upon finding a show stopper. No point in buying a complete Annual to be told the main spar is seriously corroded.

Again, we are saying the same thing, pretty much.

FYI, AC20-106 states - "On wet sump engines, inspect the sump for evidence o:f leaks. Remove oil sump plug and inspect for foreign particles. Remove, inspect, and clean oil sump strainers."   How do you remove the sump plug without removing the oil?  I guess you could put it back in. 

TEASING YOU

[A64Pilot]

First that’s an AC, not an FAR and if we had magnetic plugs it would be logical, I believe  the particle inspection is done at the strainer and filter, both above the sump and I believe you can pull them without draining oil. 

Who has sump plugs? I did on the 210 because the nose wheel would break off a quick drain, but I think sump plugs are rare. I don’t think anyone removes quick drains?  That AC would seem to require it.

I’ve only once not drained oil myself, owner had just changed it and didn’t want it, but I did cut the filter open.

I’ve seen oil come out with what looked like glitter in it a few times, but it was really the filter that removed all doubt, that’s it’s function of course.

What I’m trying to get across is that apparently for at least some an Annual is a more through inspection than what they do for a pre-buy or nothing additional would be found in an Annual.

But as there is no definition of pre-buy, in the FAA’s eyes there is no such thing, a Pre-buy could be a more through inspection than an Annual, or it may not, if I were determined to not buy an Annual for whatever reason, I’d want a signed contract stating that the pre-buy will encompass all the inspections of an Annual, would an average mechanic sign that? My guess is no.

Besides you probably want an IA doing the inspecting, not saying an A&P may be just as good or better, but it’s like pilots, on average a Commercial pilot is more proficient than a Private pilot, same for mechanics.

[RoundTwo]

So I just finished going over a 64 page VRef desktop appraisal that used 2 comps. How do you get 64 pages out of 2 comps and a plane you’ve never laid eyes on? It’s all fluff and concludes with a seven page resume of the appraiser that also happens to be the president and CTO as well. I’ve always heard of VRef but had never seen one of their appraisals. Now that I’ve seen one, I’m not very impressed. There’s hardly any content and it’s mostly fluff, a whole lot of something about nothing.

[T. Peterson]

On 12/31/2022 at 9:13 PM, Danb said:

Since when is our planes an investment? 

The ability and flexibility to visit loved ones: priceless.

[jetdriven]

2 hours ago, RoundTwo said:

So I just finished going over a 64 page VRef desktop appraisal that used 2 comps. How do you get 64 pages out of 2 comps and a plane you’ve never laid eyes on? It’s all fluff and concludes with a seven page resume of the appraiser that also happens to be the president and CTO as well. I’ve always heard of VRef but had never seen one of their appraisals. Now that I’ve seen one, I’m not very impressed. There’s hardly any content and it’s mostly fluff, a whole lot of something about nothing.

A lot of these so-called appraisals are nothing more than a scam. There used to be an NBAA appraiser software that would take actual sale price comps and create value from that, used by their certified appraisers, but that hasn't been an operation for years. So we have "aircraft appraisers" that basically invent values from thin air. We hired one when we bought our partner out in 2019, and the price was fantasy. 1977 J with new paint, low hour factory engine, speed mods, upgrades, GTN750 with GPSS roll steering,  and his "appraisal" was 90k.   when asked where he got his comps, he said "Vref".   A cursory perusal of Controller and TAP showed these planes were asking 130K or more at that time.

 

Jimmy Garrison has written about this problem, too. 

There are no standards, no code of ethics, no initial or recurrent training, nothing really.

[A64Pilot]

Only time I’ve seen an appraiser used was when someone was trying for the highest number they could get for insurance purposes.

From what I’ve seen, you get what you pay for, want a high number, you’ll get it

There are many professions that all it takes is for you to declare yourself as being one

I think AOPA has a valuation software, but I don’t know if it’s any good or not.

[RoundTwo]

57 minutes ago, A64Pilot said:

I think AOPA has a valuation software, but I don’t know if it’s any good or not.

AOPA uses VRef

[Mufflerbearing]

On 12/31/2022 at 7:39 PM, EricJ said:

Get a race car and you'll have the trifecta of motor vehicle financial inefficiency.

Uh oh, now I have to go and rethink my life...

[PT20J]

If you want a real valuation, talk to a broker.

[Pinecone]

On 12/31/2022 at 10:39 PM, EricJ said:

Get a race car and you'll have the trifecta of motor vehicle financial inefficiency.

I have had all three, but not at the same time.

Used to own a Laser 28 sailboat.  Faster that most bigger boats.   Hmm, is there a pattern somewhere in there?

Also have performance cars (two M3s).

 

[DCarlton]

Airplane …. Check 

Ski Boat … Check 

Sports Car … Check 

Classic Car … Check 

Truck to tow boat … Check

Total cylinders across all platforms ….  34 

Wisdom …. Questionable 

[hammdo]

You forgot motorcycles and guns for some…

-Don