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Category Archives: GA NEws

Do most aircraft sell for base book value?

Posted on February 21, 2017 by skysmith
 Question.  I have read your book *”How to Buy a Single Engine Airplane” and learned a great deal.  One question I have is that since you have done so many plane transactions, you made mention that you see most planes go close to the base retail price as noted on Vref? 
Is it still a buyer’s market? If that is still true, would a better deal be below base retail?  As I look at pre-owned planes I want to make sure I don’t pay too much.  Thanks for your advice if you have time to answer this email.
Answer. Thanks for the email. I personally think that it is still a buyer’s market.  I am still seeing a slight increase in sales, but the market still seems to be slower than it has been in years past.  I’ll guess that a lot of people have an opinion about this.  I also see a lot of prices when we are insuring aircraft purchases.  I try and keep an eye on the values of the new transaction and compare them to the book to see what the buyers are paying. And the underwriters will question a value that is too high or too low. 
Remember, this is my opinion about the market. 
I think that many of the aircraft advertised are overpriced and now that the investment and aviation markets seem to be growing again, the sellers are reluctant to lower their prices for a sale and risk losing money.   Additionally, fairly low interest rates will allow sellers to keep a higher price.  The sales pitch is that the payments will still be low.
My guess is that the seller will try and wait for the higher price BUT, even then, it appears that most of the aircraft end up selling for a price that is around the base values listed in the books.
The Vref base value takes into account the average number of hours that the aircraft should have on the airframe and engine at the time of sale.  The base price also includes a standard radio package for the model and an average condition.  That is probably representative of over 50 percent of the aircraft on the market.  So the base price is probably representative of over 50 percent of the aircraft for sale.  Sure, you can add for low engine time and low airframe, but it all seems to balance back towards the base price.  A plane with a low total time, say 1,500 hours, will get an increase in value for the hours.  But if the engine has 1,500 hours on it also (and a 2,000 TBO) the book will reduce the value for the engine hours over the halfway point of 1,000 hours.  Typically, the value of the engine per hour is higher than the airframe per hours.
Of course, if you have an aircraft that is loaded with all kinds of fancy modifications or avionics, the price will probably not be close to the base book values.  But on the average, basic book values are pretty close.

*The book “How to Buy a Single Engine Airplane” is out of print.  
But email me for a packet of buyers tips. 

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Posted in aircraft, aircraft ownership, aircraft sales, AOPA, Aviation, aviation insurance, aviation market, buying aircraft, Cessna, EAA, FAA, flight training, GA NEws, Piper, vref |

EAA STATEMENT ON FAA RELEASE OF THIRD-CLASS MEDICAL REFORM RULE

Posted on January 10, 2017 by skysmith
Exciting news!

EAA STATEMENT ON FAA RELEASE OF THIRD-CLASS MEDICAL REFORM RULE
FAA’s BasicMed will take effect on May 1, 2017

EAA AVIATION CENTER, OSHKOSH, Wisconsin — (January 10, 2017) — Years of effort by EAA and AOPA culminated on Tuesday morning as the FAA announced regulations that will implement the aeromedical reform law passed last July. The regulations will be published Wednesday as a final rule, to take effect May 1, 2017.  According to the FAA, no changes have been made to the language in the law.

Because it is final, the rule – named “BasicMed” by the FAA – will not go out for a typical public comment period. The FAA also said it would publish an advisory circular describing the implementation of the rule later this week.
“This is the moment we’ve been waiting for, as the provisions of aeromedical reform become something that pilots can now use,” said Jack J. Pelton, EAA CEO/chairman. “EAA and AOPA worked to make this a reality through legislation in July, and since then the most common question from our members has been, ‘When will the rule come out?’ We now have the text and will work to educate members, pilots, and physicians about the specifics in the regulation.”
Tuesday’s announcement finalized the highly anticipated measure that was signed into law last July as part of an FAA funding bill. That was the ultimate success of a long effort by EAA and AOPA to bring significant aeromedical reform to pilots flying recreationally and eliminate the time and expense burdens on those holding third-class medical certificates.
The law guaranteed that pilots holding a valid third-class medical certificate issued in the 10 years before the reform was enacted will be eligible to fly under the new rules. New pilots and pilots whose most recent medical expired more than 10 years prior to July 2016 will be required to get a one-time third-class exam from an FAA-designated AME.
The FAA was required to implement the law within 180 days of its signing, or this Thursday (January 12). Since AirVenture 2016, FAA senior leadership has been assuring EAA that the 180-day deadline would be met. Despite the release of the regulations as a final rule, EAA will be reviewing the language carefully to ensure it fully reflects the language and intent of the law.
EAA has updated its Q&A and will continue to update them to provide the latest information. EAA is also working with its aeromedical and legal advisory councils to provide resources that will help members and their personal doctors understand the provisions of the new regulations.
About EAA
EAA embodies the spirit of aviation through the world’s most engaged community of aviation enthusiasts. EAA’s 200,000 members and 1,000 local chapters enjoy the fun and camaraderie of sharing their passion for flying, building and restoring recreational aircraft. For more information on EAA and its programs, call 800-JOIN-EAA (800-564-6322) or go to www.eaa.org. For continual news updates, connect with www.twitter.com/EAA.
-30-

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Posted in aircraft, aircraft insurance, aircraft ownership, airplanes, Aviation, EAA, FAA, FAA medical, FAR, flight training, GA NEws, high wing Cessna, medical, Piper, sport pilot |

50 million aviation jobs, $3.6 trillion GDP by 2026

Posted on June 17, 2009 by skysmith

Just a reminder of how important general aviation is to the economy.

Re-printed from – The Pulse of Aviation from GANews for 06/16/2009

Jun 16, 2009 10:11 am | Tom Norton
Some 50 million jobs and $3.6 trillion of the world’s gross domestic product will depend on aviation by 2026, according to a report from Oxford Economics which provides an in-depth look at the aviation industry’s contribution to global economic development and social prosperity, while considering what that really means for individual countries, regions, towns, families and species. That forecast was contained in the report “Aviation: The Real World Wide Web” posted June 15 on the transportgooru.com Web site.

The 120 page report is offered along with four page summaries in English, French, German and Spanish.

… read the rest of 50 million aviation jobs, $3.6 trillion GDP by 2026 (241 words)

© General Aviation News, 2009.

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Posted in aircraft, Aviation, economy, GA NEws, GDP, jobs |
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