How on earth do you sell an airplane in the new normal?
It seems daunting to imagine who your buyer might be, how to get a fair price on your costly investment, or whether or not you’ll ever even be able to sell it in today’s market.
Good news – the demand for pre-owned planes is on the uptrend, and the market favors sellers in several markets. Buyers want high-quality, well-maintained aircraft and are willing to pay a fair price for it. They also wish to a seller who is organized, and I will walk you through some easy ways to make your aircraft more appealing.
If you’re considering selling an airplane in 2020, read on to learn how you can ensure a painless and speedy experience that will please both you and the potential buyer.
Selling an Airplane in 2020
Aviation is cyclical, and many of us have lived through a changing market. The COVID-19 pandemic has created several new questions about buying and selling aircraft, and this article will focus on sellers as its rarely a written subject.
The truth is you can sell a plane today, and more importantly, the demand has not changed in the piston market. Buyers are still closing, banks are even lending, and the FAA is still taking documents (albeit after a short quarantine).
There are some relatively simple things you can do as a seller to put on your aircraft on the pedestal it deserves and generate top dollar at the same time.
When you decide it’s time to sell, then you have got to get organized. You wouldn’t list your home if it were in disarray or worse yet in the middle of some refurbishment, so why do it with a plane?
You get one chance to introduce your aircraft to buyers, yes you read that correct, you get one shot. Buyers pay attention, and they will notice everything, including how often you remove and put up your listing.
Do it right the first time, and you will attract legitimate buyers, and they will have fewer questions.
Step one, collect your records and logbooks and get them organized. You want them in binders, and better yet, go ahead and get them digitized. It’s a smart thing to do anyway, and now you have no excuses. VREF Vault has a new product to assist with this as well. Organized logs are going to demonstrate proper maintenance, care, and cleanliness. Buyers like to see a seller who treats the equipment and the records with care.
Step two, make the spec sheet. You will need it for the listing, and every potential buyer. I can not tell you how many times I see inferior specs or none at all.
Step three, take a full set of photos and timestamps them. Buyers hate feeling like they have been misled, so the time stamp your pictures and make sure they are in focus. A poor photo is worse than none at all.
Take the time to shoot the aircraft in the proper light, and please make sure it’s clean. You get one shot, right? Why not detail the plane before you take photos.
Step four, list the aircraft and include your contact information. A proper listing should consist of serial numbers, the registration, and the aircraft total time and time since overhaul. Buyers will call, text, email, and do it at all hours. A prepared seller responds quickly and is not afraid to address questions.
Step five, the tire kicker rears his or her head. Interacting with the public is just part of selling, and while it seems buyers are all jerks, the truth is they are just trying to sort through the market. I can assure you if you follow my advice above that you will limit your exposure to this segment of buyers. You will still have to deal with a buyer who is not ready to purchase, so my advice is friendly. You never know who will close in market-facing new challenges.
Who is Your Buyer?
Today potential buyers might be a little different from previous markets. Depending on the type of aircraft you are looking to sell, you might wind up dealing with people looking to general aviation for the very first time. Buyers come in all shapes and sizes, and it can be frustrating if you are trying to market your aircraft to the wrong audience.
One of the best resources to sell an aircraft is an owner’s group on Facebook. I also like using Trade-A-Plane and Controller as they, along with Barnstormers, are the industry standards for listing aircraft for sale.
Your buyer might be a husband and wife, or a father and son. Partnerships are becoming more popular as people look for alternatives to commercial airlines.
Businesses also buy smaller general aviation aircraft. Executives can travel without the hassle of airport security and being in the public eye. This is a segment that should continue to grow as companies look to maintain productivity and avoid airliners.
Before selling your plane and putting it on the market, it is smart to have the aircraft professionally appraised, ideally by a Uniform Standards of Professional Appraisal Practice (USPAP) compliant appraiser. USPAP is the industry standard in fair and professional appraisals. With USPAP, you are receiving an accurate and honest assessment of the plane’s value. More importantly, it governs how an appraiser can practice. Did you know USPAP compliant reports require the appraiser to sign a statement stating the appraiser has no bias, has no vested interest in the property, and that the compensation is not dependent on the outcome of the appraisal? It includes several other signed statements as well, but the important take away is that only an independent appraiser with USPAP compliance can provide an accurate assessment of the aircraft.
Preparing for Sale and Closing the Deal
Escrow is your friend, and they serve a critical role in the closing of an aircraft transaction. As the seller, you will want to be assured funds are in place before you close. An escrow agent will make sure all documentation is in place as well and trust me when I say the fees you pay are worth it.
Once you’ve found a buyer and are ready to close the sale, several legal steps need to be completed. This includes completing the Bill of Sale. It goes to both the FAA and the buyer, transfer of funds, and title, which will consist of logbooks and the registration certificate. Any additional paperwork, as required by either your state or by your business, will also need to be done.
Once this has been completed, you have officially closed!
If selling an airplane in 2020 is on your plan, you’ll no doubt want to make sure you get a fair price, and you’re probably likely to have a few questions about the process.
For expert guidance on selling, appraisals, and market value, contact us to get started. We’ll ensure you are supported through all stages of the selling process of your private plane.