I recently read an article in a local business magazine that struck a chord.  The article asked business brokers whether business buyers currently have an advantage or whether the power rests with sellers.  One line in particular really made sense.  It said, "if you have a good business, one that is growing profitably and in a good solid industry, you're always going to be able to get top dollar in that industry."

o a certain degree, that same concept translates into aircraft ownership.  If you have a desirable airplane model, keep it updated, avoid damage, and have not skimped on maintenance, you should be able to get top dollar for that airplane.  Of course, everything is relative and if the market has dropped 30% you're probably not going to recoup that loss.  You should however, be able to net a much better price for your asset than your peers who have not paid the same attention to their airplanes.

Strategies

If you'll oblige, let me share with you several strategies I've seen that have worked the best for the people we help.

1.  Begin With The End In Mind

First, and you will recognize this if you are a Stephen Covey fan, you have got to begin with the end in mind.  f you are going to buy an airplane, your first thought should be, "How will I fare when it's time to sell?"  If you are buying a model that has a terrible history of retaining any value then you should not be surprised that there is still no marketbable value when you get ready to sell.  If you are putting little to nothing down and have a debt-to-equity- ratio nearing 1:1, you probably ought not be shocked when you find yourself upside down on your loan when it is time to sell.  Take an objective look at the plane you are considereing before making any commitment.  Often, this involves asking a third party for their opinion.  In any case, do your homework before you set your heart on aspecific bird.  Allowing emotions to enter the equation at this stage almost always means you are gong to lose more money than you should.  

2.  Proper Maintenance & Necessary Updates

Second, maintainyour airplane properly and keep it updated.  You do not have to go overboard, but insisting that your 20 year-old panel does not need a facelift is delusional.  Buyers want to see some upgraded avionics.  Updated radios, fresh engine overhauls, and thorough annuals will do more to retain the value of your plane, and hence create ore of a sellers market for you r plane, than will new paint and interior.  Most buyers prefer to spend money on things that will customize the plane for them rather than on things to bring the airplane up to date.  Naturally, keeping your paint and interior in first rate -- or like-new -- condition will help the cause.

ere is a good example.  WildBlue sold a Beech Bonanza for Don.  Don's airplane was nearly 20 years old and, on the surface, looked it.  The paint and interior were original.  They were not in bad condition, but they were not great either.  Don flew his plane regularly and made the decision to spend his money on things that mattered.  For instance, he swapped out one of his old King radios for a new Garmin GPS, added an Aspen primary flight display, and upgraded his engine to one with higher horsepower (which, as a result, increased his useful load too).  Don's maintenance program was routine and thorough and his logs were well organized and easy to read.  Besides the outdated cosmetics, the plane was in top notch condition.  If you are one who tracks "book" values, this is an airplane that "booked out" at 2-3% less than the sales price.  While that number might not sound impressive, consider that at the time of the sale, most planes in his category were selling for 5-7%below book value.  In essence, Don got a 7-10% premium on his plane.

et me contrast this with another client we'll call "Steve."  Steve had a similar, yet slightly newer aircraft that he bought new.  During his 15 years of ownership, other than very good maintenance, he had done nothing to keep the airplane up with the times.  The radios were original and the engine time was approaching the high range.  His paint was still in very good condition as was the interior (although it was cloth, not leather).  Steve's airplane ultimately sold for well below book value.  Why?  Because when the new buyer factored in the cost of needed upgrades, the price he was willing to pay was the highest amount that would keep him from owning an airplane that was worth far less then the amount he had invested in it.

3.  Manage Your Expectations

Finally, my last bit of advice to buyers is to not expect the plane to retain its value.  Sure, some airplanes will increase in value and some will hold their own, but most airplanes are a depreciating asset.  Any broker, dealer, or owner who tells you otherwise is shooting for a quick sale.  You are not buying a plane as an investment; you are investing in a tool that provides other tangible and intangible benefits.  The true cost of ownership should take those items into consideration too.  

The popular and contemporary position is that it is a neutral market -- neither favoring the buyer nor the seller of high-quality piston singles and twins.  However, good airplanes with solid backgrounds and routine care should have a much better chance of netting top dollar than those that have been ignored by their current owners.