Crazy Pricing?

[Boatguy]

Thank you, can you tell me how to interpret each column?
I’m not sure to understand correctly

Year / Model / Serial Number

Retail value: The price you would pay as a buyer, or receive if you sold it yourself.

Price change: I'm guessing this is in the last year or some time period.

Since new: This is the current value as a percentage of the original purchase price.

Wholesale value: This is the amount you could expect if you sold to a broker or traded your plan in on a new plane (corrected per CFIDave's post below).

AFTT: Airframe Total Time - the hours they assume would be on the airframe

Cost / hr: Not sure as I would expect this to be negative when the current value is higher than the original purchase price.

[astaib]

Thanks

[CFIDave]

Wholesale value is what a sales broker would pay to PURCHASE your plane from you, typically because:
- you didn't have time to have the broker advertise it for sale and find you a retail buyer and thus you needed a quick sale, or
- you wanted to trade in your aircraft and have the wholesale value applied to a new aircraft.

Otherwise most sellers enter into a BROKERAGE agreement in which the sales broker markets your plane to find a buyer -- at as high a price as possible. The seller then collects the retail price from the buyer but pays the broker a % commission. Brokerage almost always generates more money for the seller than trading in the aircraft for only wholesale value.

I believe the cost/hour final column in the VREF file above is how much to add or subtract to the price depending on whether the plane has fewer or more hours than shown in the AFTT 2nd-to-last column. It's a way to adjust the price for low-time or high-time aircraft (relative to other aircraft of the same model year.)

More sophisticated estimates also take into account engine time since overhaul, installed options, and condition of the aircraft.

[Rich]

The vref document seems to use base price. Calculating backward, it implies we paid about $190K for our plane, but it was actually $225K. The AP was a 25K option and without looking it up I believe the GNS units were an option as well.

But these are crazy prices indeed. Between what I put in as my part of the original purchase, buying out my partner and the various upgrades since, I figure I have $220K in it.

I don't figure to increase my hull insured level, though. It's currently at $110K and that's good enough. Truth be told this is such a small part of our net worth (and estate), and it's really only on the event of aircraft damage loss it's not worth upping the premium. Especially given my superior flying skills

[VickersPilot]

I think I’m comfortable calling this month the pricing peak for this market cycle. Those who buy, particularly used aircraft now are in risky territory and likely to suffer significant capital loss.

[blsewardjr]

Another data point. The AOPA Vref calculated my 2003 DA40 with mods (discounted by age) at $220K.

[Boatguy]

I think I’m comfortable calling this month the pricing peak for this market cycle. Those who buy, particularly used aircraft now are in risky territory and likely to suffer significant capital loss.

I think that's very dependent on comparable new plane pricing and availability. At least for DA62s, the wait times have grown from a little over a year just six months ago, to over two years. Based on prices quoted here for 2024 delivery, and my price for a 2022 delivery, prices have increased by 25%. The same thing has happened with Cirrus and Pilatus.

Cirrus won't even quote a price or features for a 2022 or 2023 delivery. 2022 prices come out next month and 2023 in early 2023. You make a firm commitment with a deposit based on 2021 pricing, then are obligated to pay whatever price they later publish.

The manufacturers all seem reluctant, or unable, to increase production volumes. All of this creates a very large pricing umbrella for used planes.

Unless you foresee a price reduction in the future, or general economic collapse, I don't see how the purchase of a new airplane is going to lead to significant capital loss.

I think DA40NG deliveries have not stretched out as far and I don't know what has happened to their prices.

[p3dave]

For the past 18-24 months aircraft prices in general have been increasing exponentially. The lack of affordable new planes (if you can get them) is driving up the price of the used market. This is especially true in the private jet market where demand is far greater than the supply as many people that could afford private jet travel but didn't are now doing so as a result of Covid. I watch the market for aircraft on a regular basis and a great variety of aircraft as I enjoy dreaming and I have seen Cessna 150's that would have sold for $25,000 a year ago going for $50,000.

The AOPA Vref is a nice benefit but it has never been that accurate and since this has started it is even less so.

[astaib]

Parallel to these facts, how can we continue to increase the demand for new and used plane, when the fuel (AVGAS) price is increasing dramatically and tend to disappear due to the ecological context ?

[DaveS1900]

I have a Cessna with a Lycoming engine that has been down since last May for an engine overhaul. The cylinders have been on order since last February. No end in sight. Due to the shortage of parts, the engine shop has gone to 4 days a week and has a lot of engines sitting around waiting.
Something is going to have to give.
Dave S.
Ohio