A

AWOL Arn

I'm New Here
Hello all,
I'm really new to the idea of building my own plane. I am considering purchasing a used certified plane (Mooney or such) or building one. I'm a new airline pilot so I always ask the captains I fly with. Today one told me that he wouldn't build one b/c the resale value if you have to get rid of it is terrible, whereas a good used certified plane could usually be sold for nearly its purchase price.

I am in the process of selling my boat. I've had it for 4-1/2 years, put over $32,000 in it and am hoping I can sell it for $13,000. After this lesson, I'm leary of getting so upside-down in a homebuilt aircraft. While i know that if I build one, I intend on keeping it for the long term (it goes after I die). But I also know life has a way of sometimes dealing us a new hand.

I'd really like to hear any thoughts you have on this subject. A friend who just started building stated that I could always sell a kit for near its purchase price. A couple other folks I know say that I'd be lucky to ever sell a homebuilt plane, and if I did, I'd lose a ton of money. What say you?

Thanks!!!
Cheers y'all.
Arn, Captain (soon to be former), The Good Ship AWOL.

PS, The $10,000 left over from the boat sale would buy an emp kit and tools........ ;)
 
Resale value is good

From what I can see by looking at the RVs for sale in various places, the resale value is pretty good. Of course, if you build it, and bill your time at $100/hour, then you'll never get that kind of money back.

I think if you build or don't build an RV because of the resale value, then I think you may want to get a ride in an RV. You may be missing the reason why these aircraft are so popular.

There is a great thread here talking about why various people decided to start building an RV. http://www.vansairforce.com/community/showthread.php?t=7865

Good luck with your decision process!
 
I think what you get for your RV is directly proportional with the quality of workmanship and equipment .

The advantage is you get to fly it. Cant fly with stocks ,shares ,property or any such investment, even though they may be better.

As far as aircraft go, RV seem to be a pretty sure bet.
 
How did it work out getting your money back for investment in a boat? A certified airplane may be the same. Pay 25K for it, invest another 50K for upgrades and the annual costs, then hope to get the 25K you paid for it back! Cost savings on annuals and repairs over 5 years could be a significant savings, since you're doing them yourself. I remember reading in sport aviation last year about a Mooney, supposedly in very good shape, which costs tens of thousands after the first annual revealed corrosion damage. You'll be getting a brand new airplane when you build the RV.

Just some food for thought. :cool:
 
I think you are actually not likely to get your purchase price back for a used kit (that is not complete). I personally would not pay full price for kit that was worked on by an unknown person when I could buy the latest, greatest, brand new kit straight from Van's. I might buy it, but I would demand a big discount for the additional risk I'm taking.
Its been my theory that my project gained about $30K in value the day it flew. Until then, it was a "project", not worth the same as an "airplane".
FYI: Judging by the RVs for sale, I think I could easily get $70K for my airplane, possible $80K+ if I was patient and somebody really liked mine. I've invested maybe $60K - that means my 2500 hours of labor were worth about $4/hour.
As always, YMMV.
 
Another point to make is that if you browse the ads over time specifically with regard to RV's, you'll see that airplanes sold at any time before they fly (with the first 40 hours flown off) take a hit and don't usually sell for what was paid up to that point.
Also, your RV will sell much better in the future if you don't go too "Experimental" with it. Stay with a Lycoming or clone engine, and don't make any mods that don't conform with Van's plans and how it was intended to be built.

However, once the RV becomes a flying registered AC, it will then typically sell for more than what was put into it (labor not included).
So if you're going to build, make sure you finish it.

I know for sure that mine will be up for sale at some point simply because I'm sure I'll bounce my medical in the next few years. So the way I look at it, I'll almost for sure get what I paid for it (although I'm building it for "free") and maybe even a little more. Considering the kinds of memories I get to put away in the memory bank to reflect on later, I can't think of a better investment (sort of like if you bought Google at it's IPO ;) ) even if I couldn't sell it for half what I paid.

In short; it ain't about the money, but the money can be there if you go through with the plan.
Still, I promised my wife that if anything happened to me, she could sell the RV and get all "her" money back. So if Mrs. Highflight posts at some point that she has an RV for sale due to unforeseen circumstances, I hope you guys will help her find my baby a home at a decent price. (The plane, man, the plane.) :p
 
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Prices

We finished our RV6A last November (well, finished enought to fly) and finally have all the fairings, wheel pants, etc on. I figured that it jumped in value by at least $!0,000 as soon as the wheels left the ground for the first time.

As the other guys mentioned, an unfinished kit will take a hit. I call it the shark syndrome because everyone figures that the seller REALLY needs to sell for whatever reason. On the other hand, I don't see many RVs selling for less than the sum of their parts, :)
 
A plane (certified or experimental) is worth what you are willing to pay for it and the buyer is willing to accept. If you pay too much you will not recover it when you sell. If you get a bargain you will make a profit.

The market swings wildly with fuel prices, govt proposed rulemaking and perpetuation of BS such as you were given about value of experimental vs production.

You cannot beat the quality of a well built RV. In my opinion no production plane comes close. You cannot beat the performance of an RV or it's variants.

The operating costs or costs of ownership of an RV/experimental are miniscule compared to that of a production aircraft.

Young girls crawl out of the woodwork and want to have their way with RV pilots. :rolleyes:

Bonanza owners attract 50 year old women caked in makeup who want you to take them shopping. :eek:

Do yourself a favor and build an RV.
 
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check annual costs

I have a few friends with certified Single engine retracts. Annuals have been averaging $25-30k /year. That is not a misprint. One guy just went through his 3rd year in a row over $25k. On the first trip after annual. The plane broke down and he dropped another $1k to get if home again.

Unless you can swing that without sweating it, you might want to reconsider that class of airplane.

Good luck in your decision.

John
 
A friend who just started building stated that I could always sell a kit for near its purchase price. A couple other folks I know say that I'd be lucky to ever sell a homebuilt plane, and if I did, I'd lose a ton of money. What say you?
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I would say............

None of them seem to exhibit knowledge based on experience or fact.
 
Well Maybe

It is simply supply and demand. Right now the the demand is keeping up with or surpassing supply. Who can't predict the future. I think in the past, most builders were die-hard shadetree mechanics. My gut feel is that there are a lot of people now building RVs who are simply thinking it will be great fun to build an airplane. This MAY result in a lot of unfinished kits hitting the market in the future which could drive down prices.

Finished RVs do seem to command a reasonable selling price. However, my gut feel is that more and more seem to be hitting the market. I suspect some people are building for resale, others built for the building experience and want to sell and build again, still others built and now can't afford to fly them, and still others built and after low time have discovered they aren't flying as much as they thought they would and are now trying to unload. Whatever the reason for selling an RV, there seems to be more of them coming into the market and I suspect that with the number of kits being started, there will be even more hit the market in the future.

Noone knows for sure, but IMO the trend is moving towards more kits and more planes in the market. This may result in a buyer's market. Only time will tell for sure.
 
AWOL Arn said:
Today one told me that he wouldn't build one b/c the resale value if you have to get rid of it is terrible, whereas a good used certified plane could usually be sold for nearly its purchase price.
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Considering homebuilts in general, he's probabbly correct. Narrow it down to just RVs and that doesn't seem to be the case at all. Pick up a copy of Trade-A-Plane for a little research.

AWOL Arn said:
I'd really like to hear any thoughts you have on this subject. A friend who just started building stated that I could always sell a kit for near its purchase price. A couple other folks I know say that I'd be lucky to ever sell a homebuilt plane, and if I did, I'd lose a ton of money. What say you?
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Depends on what kit and your workmanship. If you ordered a complete kit from Van's today, did no work at all and attempted to sell it the day it was delivered you would still likely lose money.

If you are concerned about losing money you should probably buy a completed kit as the number of hours invested into building an airplane will never pay you back in terms of dollars.
 
There must be some money in building and selling "amatuer built" aircraft (I'm sure only a few types) because I remember reading something from the EAA about an unofficial FAA stand on requiring DARs to certify professionaly built experimentals that the DAR knows was built just to sell.
 
Some thoughts that came in to my mind and some of them had already mentioned earlier, but to make sure there are others which think same way.

If you don't put wage for your hours, you should get at least as much you have invested (for an average plane). If you can't live with that, don't build.

Build the plane and it will be brand new. You can choose (unless the kit itself) certified engines, avionics and such but with certfitied planes you don't have that option. How much new Mooneys or similar cost? How much their annual costs are?

There are better investments than the plane but are they near as fun? Why should plane be investment at all? It's the investment for fun (and for life for some of us), not for money! For experimentals like Lancairs and RVs it's pretty easy to say resale value and you really get rid of them if you want but trying to sell some not-so-popular kits maybe a different thing.

However since you already are changing from boats to other hobbies in really short period (you had boat only 4 and ? years i quess), do you really have patience to build plane rather than buy flying one? As said the hours used to building aren't worth of "anything" but then you can say you have built it. If you buy flying plane and figure out in couple of years that you want new hobby, it would be much easier to sell than so called "95 % complete" project.

And $10000 is well enough for any tools and empennage kit so at least save it for a while and really consider what you want to do with it. However, it's not enough for complete plane, except maybe rusty Mooney. ;)
 
Pirkka said:
And $10000 is well enough for any tools and empennage kit so at least save it for a while and really consider what you want to do with it. However, it's not enough for complete plane, except maybe rusty Mooney. ;)
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I think a case can be made for an RV as "investment" if you consider that the closest GA aircraft that can be compared to an RV as far as performance goes is a Mooney (most Mooney owners will admit that they really aren't "4-place" anyway).

If you then compare the cost between a newly flying RV and a new Mooney, you just "made" $348,000, ($438,000 vs. $90,000) the difference in cost between the two and ending up with similar capabilites.

That sounds like a good "investment" to me. :D
 
Thanks to all y'all who replied with your thoughts. I got a good laugh out of them :D and definitely have some good ideas to chew on for a while. I know that building will be all about the journey, not the destination. I also understand that I will not be looking to get paid anything for my time building. But the time would be well spent. Even if I have the time, I refuse to watch "reality TV." I'm too busy making my own reality. As for doing it as an investment, I won't look at it as a monetary investment. I have a 401k for that. I know it will be an investment in fun, education, and self-realization. I'm bailing out of the boat (no pun intended) after 4-1/2 years b/c I don't live in Corpus Christi full-time anymore. I bought it knowing that i might sell it at some point when I left Corpus Christi. It was fun while I lived on Padre Island in a waterfront house and had it stowed in the back in a boat lift. Now I live in San Fran-sicko and probably will not move back to Corpus full-time ever. I'm more into aviation than power boating too. I'm a full-time pilot and also a Navy Reserve instructor pilot in the King Air 200s (TC-12s). I fly 20-25 days a month and still want more. :) If I had my own plane, I'd probably be shooting across the country on my days off chasing fish or rivers. Thanks for the info. I'll see y'all at Oshkosh or at an EAA meeting.
Cheers!
Arn
PS, I'll post when I take the plunge. :eek:
 
Highflight said:
I think a case can be made for an RV as "investment" if you consider that the closest GA aircraft that can be compared to an RV as far as performance goes is a Mooney (most Mooney owners will admit that they really aren't "4-place" anyway).

If you then compare the cost between a newly flying RV and a new Mooney, you just "made" $348,000, ($438,000 vs. $90,000) the difference in cost between the two and ending up with similar capabilites.

That sounds like a good "investment" to me. :D
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If the RV truely had the value of a new Mooney, then you would not see the descrepency at all. The value is what a willing buyer will pay given the alternatives. Clearly the buying community sees the RV's in the 80k range on average. You can quibble on this feature or that value point, but at the end of the day, this is what people are willing to pay in the open market.

That spread increases clearly with the RV-10, which is why there are so many being built for hire. Shhhh. But clearly not so for the 2 place models.

Best,
 
Speaking through personal experience, I believe resale value is partially affected by some confusion and downright misinformation. My first questions when considering buying an already-flying RV were 1) can I get insurance, and 2) who do I get to do the maintenance. #1 was easy after my Falcon rep spent a week at Oshkosh (prior to that he was clueless, but referred me to a knowledgable rep in Texas). #2 is a bit trickier.

I finally embraced the EAA statement that I would be able to do just about anything I wanted to except the condition inspection, and should let common sense be my guide as to what I try to do myself and what I ask an A&P to do for me.

That said, I was told many times by various sources (all RV builders) that without the repairmans certificate, I was limited to the same preventive maintenance tasks allowed to any aircraft owner by Part 43 - essentially oil and lightbulb changes.

I think those that advocate the idea that a non-builder cannot maintain the airplane, through either ignorance or ego, are doing themselves a great disservice. I can tell you with 100% honesty that had I believed those folks and not done further research, I would never have purchased my RV, and I doubt if I'm alone in that.

One more thing - my insurance rep told me after he got back from OSH that any experimental other than an RV would have cost 30-40% more to insure.
 
Kahuna said:
If the RV truely had the value of a new Mooney, then you would not see the descrepency at all. The value is what a willing buyer will pay given the alternatives.
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That was a joke, son. That's why the :D was put at the end. :)

But there is truth to the notion that for several hundred thousand $$ less, you can end up with an aircraft that has similar performance characteristics of a Mooney. That's the serious part.
 
Good luck

N395V said:
AWOL Arn said:
I'd really like to hear any thoughts you have on this subject. A friend who just started building stated that I could always sell a kit for near its purchase price. A couple other folks I know say that I'd be lucky to ever sell a home built plane, and if I did, I'd lose a ton of money. What say you?
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I would say............

None of them seem to exhibit knowledge based on experience or fact. Milt
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I second Milt's comment. The reason to build is have a nice plane, learn how to build and of course fun flying. It really is not to make money, but turns out RV's in general are sold for more than the builder has into it and than some.

Bottom line RV's are very popular for a reason. So there is a market. Suggest if you have not yet flown a RV, go get some demo rides. They call this ride by different names, like the $60K ride, but it usually results in writing checks and buying a kit.

The typical nice average RV's re-sells for $60k to $100k. You can build a nice RV for well under $60K, in fact it has been done for $30k or less, depends on your scrounging bargain hunting abilities. It also depends on your taste and desires. You don't have to load it up with equip. In general the bigger engine, constant speed prop, nice panel and paint job are all value added.

Building is not suppose to be a money making deal, and the FAA did not set up the amateur category for that purpose. Its for eduction. It just happens that the RV is such a bargain kit, performance and handling are so good, that you can indeed make money, not only recovering the cost but some labor.

To be fair your friends advice is partially correct. Some kit planes in the past (no longer around for good reason) where dogs. There are over 4000 RV flying and they have been around for +20 years. The RV is a pretty safe bet.

It is true if you buy a kit and do a lousy job and sell it as a unfinished kit you may just barely recover your cost, but lets think of success. You have plenty of help. Check Van's web site builder "LINKS" and go get that Demo ride.

Good Luck and congrats on your new life.
 
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