First Purchase Price Question

Hi, All;

Have looked at some a/c for sale, and have found one I'm interested in.

The bird has not been flown in over two years, and is out of annual.

The owner said that he would have an annual done before quoting me a price;
guess he figures it will be worth more as a result. This was one of those
situations where I noticed a plane that didn't seem to have much use, so I
decided to contact the owner.

So, an annual was scheduled. The A&P (has never seen this a/c before) says
that it needs quite a bit of work. Needs a top overhaul, some brake work,
nose strut rebuilt, and some other lesser items. Otherwise, the airframe is
in good shape; paint fair, but passes the 20' test, needs some carpet and
plastic.

What is usual here for working up a price, realizing that there probably
isn't any typical way of handling the negotiations? At this point, nothing
is signed. The owner is stating that if everything was working fine, it
would be worth "X" dollars, and he is considering the option of selling it
for "X" minus the estimated cost of repairs for the items above.

My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations? It's a common simple plane, but I'd
really prefer to work with something local at my current airport instead of
continuing to hunt all over the state/country.

Thanks;
Carl

If you really like the aircraft in question. Figure out what it is
worth , minus the needed repairs and add in $10K extra, because sure
as s**t there is more.

For every cockroach you see, there are a hundred others hiding
somewhere.



On Sat, 25 Oct 2003 19:12:57 -0500, "Carl Orton"
wrote:

Hi, All;

Have looked at some a/c for sale, and have found one I'm interested in.

The bird has not been flown in over two years, and is out of annual.

The owner said that he would have an annual done before quoting me a price;
guess he figures it will be worth more as a result. This was one of those
situations where I noticed a plane that didn't seem to have much use, so I
decided to contact the owner.

So, an annual was scheduled. The A&P (has never seen this a/c before) says
that it needs quite a bit of work. Needs a top overhaul, some brake work,
nose strut rebuilt, and some other lesser items. Otherwise, the airframe is
in good shape; paint fair, but passes the 20' test, needs some carpet and
plastic.

What is usual here for working up a price, realizing that there probably
isn't any typical way of handling the negotiations? At this point, nothing
is signed. The owner is stating that if everything was working fine, it
would be worth "X" dollars, and he is considering the option of selling it
for "X" minus the estimated cost of repairs for the items above.

My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations? It's a common simple plane, but I'd
really prefer to work with something local at my current airport instead of
continuing to hunt all over the state/country.

Thanks;
Carl

As they say, a plane (or anything else, for that matter) is only worth as
much as what someone is willing to pay for it. You can say you have a penny
worth $100 only if you can find someone willing to give you $100 for it.

You don't say what make/model you're looking at; which doesn't make too much
difference. For example, if you're trying to buy a C150 that averages about
$25k in certain areas that needs $10k worth of work to get flying, you
'should' be able to get it for under $15k. Look around and to see if there
are similar makes and models in your area that don't need as much work and
are flyable to compare prices. There are some good buys out there if you do
your homework.

Also, work with the seller. If he says it's worth $x if it's fixed up or $y
as is, offer him something less than $x or $y and see if he accepts it. When
I bought my aircraft, I waited for the seller to come down on the price and
saved $3,500 from his original asking price.

YMMV


"Carl Orton" wrote in message
...
Hi, All;

Have looked at some a/c for sale, and have found one I'm interested in.

The bird has not been flown in over two years, and is out of annual.

The owner said that he would have an annual done before quoting me a
price;
guess he figures it will be worth more as a result. This was one of those
situations where I noticed a plane that didn't seem to have much use, so I
decided to contact the owner.

So, an annual was scheduled. The A&P (has never seen this a/c before) says
that it needs quite a bit of work. Needs a top overhaul, some brake work,
nose strut rebuilt, and some other lesser items. Otherwise, the airframe
is
in good shape; paint fair, but passes the 20' test, needs some carpet and
plastic.

What is usual here for working up a price, realizing that there probably
isn't any typical way of handling the negotiations? At this point, nothing
is signed. The owner is stating that if everything was working fine, it
would be worth "X" dollars, and he is considering the option of selling it
for "X" minus the estimated cost of repairs for the items above.

My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations? It's a common simple plane, but I'd
really prefer to work with something local at my current airport instead
of
continuing to hunt all over the state/country.

Thanks;
Carl

"Carl Orton" wrote:

Have looked at some a/c for sale, and have found one I'm
interested in.
The bird has not been flown in over two years, and is out of annual.

Keep looking. Unless you can absolutely steal this airplane and are
willing to put up with possibly months of headaches, walk away from
this one.

It's a buyers market. There are plenty of good airplanes out there.
--
Dan
C172RG at BFM

"Carl Orton" wrote in message
...
Hi, All;

Have looked at some a/c for sale, and have found one I'm interested in.

The bird has not been flown in over two years, and is out of annual.

The owner said that he would have an annual done before quoting me a
price;
guess he figures it will be worth more as a result. This was one of those
situations where I noticed a plane that didn't seem to have much use, so I
decided to contact the owner.

So, an annual was scheduled. The A&P (has never seen this a/c before) says
that it needs quite a bit of work. Needs a top overhaul, some brake work,
nose strut rebuilt, and some other lesser items. Otherwise, the airframe
is
in good shape; paint fair, but passes the 20' test, needs some carpet and
plastic.

What is usual here for working up a price, realizing that there probably
isn't any typical way of handling the negotiations? At this point, nothing
is signed. The owner is stating that if everything was working fine, it
would be worth "X" dollars, and he is considering the option of selling it
for "X" minus the estimated cost of repairs for the items above.

My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations? It's a common simple plane, but I'd
really prefer to work with something local at my current airport instead
of
continuing to hunt all over the state/country.

Thanks;
Carl

Unless you're getting an absolute steal, I think you'd be foolish to buy
the airplane before the annual is done, a pre-purchase inspection is done by
an AI in your employ (preferbably the one you'll use for the forseeable
future), and the aircraft is flown for a couple of hours with you and either
the owner or an instructor. A poorly maintained airplane can be a moneypit
of unbelievable proportions. Something like the house I bought last year,
but that's another story.

KB

Carl Orton wrote:


My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations?

Dunno about a simple rule of thumb, but here's mine. Take the value of a similar
aircraft in average condition. Subtract the amount that it would take to repair
the known deficiencies. Your first offer should be in this ballpark. Then take
the same average value of a similar aircraft and subtract half the amount it
would take to repair the known deficiencies. Under no circumstances should you
allow the owner to negiotiate the price higher than this.

Yoy take your chances on unknowns.

George Patterson
You can dress a hog in a tuxedo, but he still wants to roll in the mud.

"Kyle Boatright" wrote in message
t...
A poorly maintained airplane can be a moneypit
of unbelievable proportions. Something like the house I bought last
year,
but that's another story.


A '2 story' house??? ;-)

As others have said, keep looking. Unless you have the funds and time to
stick into this aircraft, your money could be spent better on something
else...

In article , "Carl Orton"
wrote:


The bird has not been flown in over two years, and is out of annual.

Unless it was prepared for 2 year storage, accept that there may be
corrosion inside the engine.
I personally would not even consider this aircraft. There are lots of good
ones out there.

--
Tony Roberts )
PP-ASEL
VFR-OTT - Night
Cessna 172H

UPDATE: Between the time the original note was posted and now, the deal has
fallen through. Owner decided the plane was worth more to him even with
adding all the rework rather than selling for a loss.

Thanks for the responses, though!
Carl

"Carl Orton" wrote in message
...
Hi, All;

Have looked at some a/c for sale, and have found one I'm interested in.

The bird has not been flown in over two years, and is out of annual.

The owner said that he would have an annual done before quoting me a
price;
guess he figures it will be worth more as a result. This was one of those
situations where I noticed a plane that didn't seem to have much use, so I
decided to contact the owner.

So, an annual was scheduled. The A&P (has never seen this a/c before) says
that it needs quite a bit of work. Needs a top overhaul, some brake work,
nose strut rebuilt, and some other lesser items. Otherwise, the airframe
is
in good shape; paint fair, but passes the 20' test, needs some carpet and
plastic.

What is usual here for working up a price, realizing that there probably
isn't any typical way of handling the negotiations? At this point, nothing
is signed. The owner is stating that if everything was working fine, it
would be worth "X" dollars, and he is considering the option of selling it
for "X" minus the estimated cost of repairs for the items above.

My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations? It's a common simple plane, but I'd
really prefer to work with something local at my current airport instead
of
continuing to hunt all over the state/country.

Thanks;
Carl

Hey Carl,

It would be interesting to track this as it unfolds. I doubt you would
get truthful and accurate numbers, but I'm sure the group would love to
see where this fellow ends up.

Top overhaul? Yeah right. Until they pull the cylinders and see the
corroded, useless cam. After 2 years of sitting - I would put money on it.

And I love the notion of "subtract all the necessary repairs from the
purchase price". I would agree if I could fly it for a year and do the
following annual with MY mechanic. We subtract all the repairs for the
year and anything that comes up in the next annual. Then I will tell you
that is a good method of figuring the plane's real worth. All the
"necessary repairs" are not going to jump off the plane and fall into
the mechanic's squawk book today. Guaranteed. But, after 80-100 hours of
operation, I'd place money on the fact that many, many items (initially
unnoticed) come up. I'll make it interesting, I'll pay for half of what
comes up and, of course, I'll pay for the inspections.

In the "subtract the repairs from the price scenario", who gets to
decide what the anticipated "repair price" will be? For this "top
overhaul", are we getting new cylinders or some off the rack, cut rate
rebuilds? If I am right and this top overhaul goes South, will it be a
new cam or regrind? Will we assume the case will be usable? Alternator
overhaul, carb overhaul, prop overhaul, muffler, exhaust stacks, hoses,
control cables, scat tubing, pulleys, and the list goes on and on.

But, as you said, they guy got greedy. He has been fooled by his own
marketing and is trying to "buy" the airplane himself by taking on all
the repairs. He just did you a tremendous favor. You get to watch what
would have happened to you.

My prediction: the total bill to get this thing in reasonable flying
condition plus 6 months of flying will double or worse. More likely,
when the bills start to mount, he will try to cheap out the remaining
repairs or he will bail out and put it on the market again unfinished.

I would look at a prospective plane like this: what does it have going
for it? Paint, interior, engine, airframe, and avionics. If one is weak
and the price is right, the bird is usually worth a look. Two or more
and my interest fades no matter what the price.

Opinions vary,
Mike

Carl Orton wrote:
UPDATE: Between the time the original note was posted and now, the deal has
fallen through. Owner decided the plane was worth more to him even with
adding all the rework rather than selling for a loss.

Thanks for the responses, though!
Carl

"Carl Orton" wrote in message
...

Hi, All;

Have looked at some a/c for sale, and have found one I'm interested in.

The bird has not been flown in over two years, and is out of annual.

The owner said that he would have an annual done before quoting me a

price;

guess he figures it will be worth more as a result. This was one of those
situations where I noticed a plane that didn't seem to have much use, so I
decided to contact the owner.

So, an annual was scheduled. The A&P (has never seen this a/c before) says
that it needs quite a bit of work. Needs a top overhaul, some brake work,
nose strut rebuilt, and some other lesser items. Otherwise, the airframe

is

in good shape; paint fair, but passes the 20' test, needs some carpet and
plastic.

What is usual here for working up a price, realizing that there probably
isn't any typical way of handling the negotiations? At this point, nothing
is signed. The owner is stating that if everything was working fine, it
would be worth "X" dollars, and he is considering the option of selling it
for "X" minus the estimated cost of repairs for the items above.

My thoughts are that since a test flight has not occured, that more things
might crop up, so the price should be decremented some more. Is there any
rule of thumb for these situations? It's a common simple plane, but I'd
really prefer to work with something local at my current airport instead

of

continuing to hunt all over the state/country.

Thanks;
Carl







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