We’ve had potential buyers ask us to find them a “steal of a deal” – in other words a highly undervalued aircraft. Such deals exist, but are very few and more times than not, they are not aircraft you envisioned yourself in.
When we hear this request, usually in the buyer’s mind, this “steal” is going to be a deal on their favourite aircraft type, with not too high time, in their preferred age range and with the avionics and configuration that they want and need. The odds of finding this undervalued aircraft are incredibly slim. You cannot expect to buy an undervalued aircraft that meet all your desires and needs. Finding an aircraft that meets your preferred specifications criteria will typically be fairly limiting with various aircraft having different ages, hours, configurations and certifications leaving only a small number of possible options. When you add in a preference for an airplane that is largely undervalued those numbers shrink much further still.
You have to ask yourself: are you really wanting to pay under market value for an aircraft, or are you wanting a specific jet with certain parameters? Weigh out what you value more: is it how much you are paying or is it what the aircraft will do for you?
If it is the aircraft itself and there are characteristics you really want it to have then you will almost certainly have to pay market value to get the characteristics you really want. If it is a low price you are after, you will have to be prepared to compromise on certain aspects of your wish list, particularly aircraft type.
If a low price is really your motivator, you will have to be prepared to compromise on a number of items. Odds are the aircraft will have higher time than desired, or large maintenance coming due, or a non-standard interior or any combination of these things. It is often expected in these undervalued aircraft deals that to achieve the lower price you have to forgo certain due diligence items, such as the Pre-Purchase Inspection (see What to Expect from a PPI here), that we would not recommend. These under valued aircraft are very rare and wholesale dealers are chasing them on a regular basis. Wholesalers are the strongest competition for these aircraft and will often forgo the PPI and take the aircraft back to their own maintenance facility to do the work themselves at a low cost.
Fundamentally, this comes down to a choice of deciding to take the risk of purchasing an aircraft that has a very attractive low price but also undesirable traits or a greater maintenance risk, or deciding to pay more money than you originally hoped and have an aircraft that suits your needs and has much less risk associated with the transaction structure.
Talk to your aircraft broker who can tailor your aircraft search around your specific criteria. You will discover where you are willing to be flexible and where you do not want to compromise. Neither buying philosophy is right or wrong, but understanding your true motivation will make the buying process much smoother and less time-consuming.
