????? On Airplane Ownership

[HueyPilot]

I just spent part of Tuesday out at the nearby GA airport, looking for a plane to rent closer to home, when I ran into a guy selling his 1946 Cessna 140. It was a pretty nice little airplane....seemed well taken care of (although I'm not an A&P).

Anyhow, he said he was going to sell it for about 20K, and it got me thinking about owning my own airplane. Personally, I'm a USAF Learjet 35 pilot, so I'm not looking to build time, and I really can't afford an airplane that's a good travelling aircraft (like a Bonanza, etc). What I would like is just a little puddle-jumper to take friends and family up, and just have a fun afternoon on the weekends.

I was thinking about something in the 20K range....Cessna 120/140/150/152, or a Piper Cherokee 140/Tomahawk. But, I don't know squat about owning or buying an airplane, so I wanted to come here and pick the brains of those who have owned airplanes like that at one time or another.

Yes, I've heard the old saying that there are three things best left to renting versus buying (airplanes, boats and women). But I certainly wouldn't be doing this for economy's sake. If that were the case, I wouldn't go burn Avgas for no reason other than for fun in the first place. But on the flip side, I don't want to get myself into a financial nightmare either.

Questions I have:

1. What's the usual loan term/interest rate for an airplane in the 20K price range?

2. I'm aware of the annual inspection...but what other scheduled maintenance items would a C120/140/150 owner look for? And how much do those things cost?

3. Out of those airplanes above...what are your recommendations as the best one to own? Not just performance-wise, but also AD-wise and reliability-wise.

4. How much does insurance cost for an airplane of that category? Both bare-bones insurance costs and full-up insurance costs would be nice to know so I can decide which one is worth the money.

5. How many of you saved money for non-scheduled maintenance and overhauls? How much did you put away per flight hour?

6. What are some of the other costs not normally thought of...aside from loan payments, insurance, inspections, gas, etc? I've heard some people talk about fixing up interiors because those go downhill fast...others talk about keeping their radios certified for IFR (not too interested in that), etc.

7. I make about what a regional jet captain makes ($60K-ish). Wife makes 30K-ish. I have some debt I'm trying to pay off, but once that's gone (and once I have only one car payment in a year or so), would owning an airplane on that kind of money make sense?

8. What about partnerships? Would finding a partnership be a better route until I make more, and perhaps be a better way to learn the ropes of owning an airplane?

Thanks ahead of time for any info/comments/smart remarks.

 

[Loafman]

1. What's the usual loan term/interest rate for an airplane in the 20K price range?

2. I'm aware of the annual inspection...but what other scheduled maintenance items would a C120/140/150 owner look for? And how much do those things cost?

3. Out of those airplanes above...what are your recommendations as the best one to own? Not just performance-wise, but also AD-wise and reliability-wise.

4. How much does insurance cost for an airplane of that category? Both bare-bones insurance costs and full-up insurance costs would be nice to know so I can decide which one is worth the money.

5. How many of you saved money for non-scheduled maintenance and overhauls? How much did you put away per flight hour?

6. What are some of the other costs not normally thought of...aside from loan payments, insurance, inspections, gas, etc? I've heard some people talk about fixing up interiors because those go downhill fast...others talk about keeping their radios certified for IFR (not too interested in that), etc.

7. I make about what a regional jet captain makes ($60K-ish). Wife makes 30K-ish. I have some debt I'm trying to pay off, but once that's gone (and once I have only one car payment in a year or so), would owning an airplane on that kind of money make sense?

8. What about partnerships? Would finding a partnership be a better route until I make more, and perhaps be a better way to learn the ropes of owning an airplane?

Thanks ahead of time for any info/comments/smart remarks.

I've owned a few planes in the last ten years and I'm sure someone will disagree with me, but ownership beats renting hands down if you plan on flying much over 100 hours a year in a piston single.

I've managed to make money on just about all the planes I've owned and come close to breaking even on the less marketable ones like experimental / tailwheel / fabric.

I've owned just about every type you can think of from ultralight to light twin, and if you want to come out ahead, buy something theres going to be a market for when it comes time to sell it. The hardest thing I ever had to sell was an amateur built Pitts S1C. You have to think of the target market for resale, and there aren't that many Pitts customers out there as opposed to those in the market for a C150. Don't get me wrong, the Pitts was a lot more fun than a C150, but it was harder to find a buyer for.

First off, stay away from fabric airplanes with cotton covering. Even brand new cotton is going to need replacement much sooner than synthetic fabrics. I don't know what kind of C140 you're looking at, but there are several varieties. Some have been converted to metal wings, some are factory metal (140A is essentially a C150 tapered wing with single struts)

$20K is a little high for a basic fabric 140. Shop around, and don't fall for anything based on looks alone. GET A PRE BUY INSPECTION. A few hundred bucks spent at the local IA is a drop in the bucket compared to the cash you'll dish out if you buy a pig-in-a-poke.

Also, consider the target market if you want to sell it later. Taildraggers are like stick shifts. "It sure is nice, but I don't know how to drive a standard"

As for financing, I can't answer that accurately in todays economics. I would guess that with today's rates, you could get a deal with decent credit. I always went 6 years with car loan type notes, because my bank didn't do "aircraft" financing. My worst note was on a G-35 Bonanza that I bought for no down payment at $38.5K. It came out to 750 a month or so, at 6%, if I remember correctly. Half that for a 20K plane.

Insurance was always easy, but be sure to fudge some time-in-type to get the rate down. Plan on $1000/year for 20K hull coverage and mill-liability if you have plenty of time and a clean record. Wenk Insurance at 1-800-CAL-WENK, ask for Holly. She'll shop all underwriters and give you the best quote. There are only about 7 or 8 companies out there plus Avemco, so one stop with an independent agent covers all your bases.

Costs of ownership come in two flavors. Fixed and variable. The varible expenses are things like insurance, hangar, annuals, etc. If you pay 100/month for hangar, 1000/year for insurance, and 800/year for MTX, your variable costs are $3000/year. if you fly 100 hours a year, these set you back $30 an hour. Fly yourself silly at 300 hours a year and these drop to $10/ hour. These costs vary with how much you fly.

Fixed expenses are hourly related items. Gas, Oil, and engine overhaul. If your plane burns 7GPH and fuel is 2 bucks, then plan on $14/hr for fuel. 20 hour oil changes at 40 bucks a whack are $2/hr. An 1800hr TBO Continental costs about $6 an hour for MTX reserve, assuming an $11,000 overhaul cost at a reputable shop. If you know an A&P who will work with you, this could vary a lot.

Lets see where your little C140 starts to pay for itself.

Flying 100 hours a year:
Variable Costs (Hangar Insurance Annual) $30/hour
Fixed Costs (Fuel, Oil, Overhaul reserve) $22/hr
Total $52 an hour. Cheaper to rent in this category.

Flying 300 hours a year
Variable Costs $10/hr
Fixed Costs still $22/hr
Total $32/hr. Way cheaper than renting, and you've found a way to write off the expenses, right? : )

If you're an accountant, this is all fuzzy math because I havent amortized the initial expense of the purchase price plus interest and depreciated it over the life of the item in question. Heres where ownership really starts to look good. IF you buy the RIGHT airplane, they actually appreciate in value over time. Buy the WRONG airplane, and you run into the problems I mentioned in the beginning of this novel. A wonderful example is the Cessna 180. Unfortunately, you've missed the boat on most bargain 180's but an airplane that sold for 30-40K Ten years ago is worth twice that now. Beech Bonanzas are other great buys in piston singles, but with the disappearing michelins comes more insurance cost. I have owned Bonanzas, and the cost per hour was higher, but the speed made up for it in the cost per MILE. I actually spent less to operate my G35 than my C177, because I utilized it more.

As for buying fixer-uppers, just consult with someone who knows what they're doing. I had a buddy with a 172 that was mechanically great, but looked like a pig. We spent about $1500 in materials and did the labor ourselves and turned a $28K investment into a $50K valued airplane, just on cosmetics. I'll admit $28K is cheap for a clean Shyhawk with a 180 conversion and C/S prop, but the secret is finding the deals on the mechanical gems that are rough around the edges. Conversely, I had a buddy lose $80K on a Twin Commander he bought from a crook that looked like a millon bucks (new leather, paint etc.) but had thrashing machines for engines. He obviously neglected the PRE BUY INSPECTION I emphasized.

In summary, get whatever kind of plane will suit your purpose. Don't settle for a 2 seater if you plan on taking a family cross country anytime soon. Theres nothing more frustrating than pointing a C140 into a 20 knot headwind and watching cars pass you on the highway. It sounds fun at first, but if you're anything like I am, it gets old quick, and you're in the market for something faster.

Old Bonanzas are the best kept secret in general aviation. Of all the planes I've had, thats the one I wish I'd kept. They're reasonably efficient, comparatively fast, VERY well built, (ever notice the plastic "royalite" trim in a Cessna? In a Beech it's aluminum, and the fit and finish is much better) and there are Bonanzas in ALL price ranges. They appreciate in value and have excellent resale potential.

If you've read this far, you're obviously serious, so find someone you trust, and get the ball rolling toward aircraft ownership. There's nothing like opening the door of the hangar and finding everything exactly the way you left it. Try leaving your handheld GPS in a rental and getting it back.

Good Luck.

 

[azpilot]

Questions I have:

1. What's the usual loan term/interest rate for an airplane in the 20K price range?

10 years 7-9%


2. I'm aware of the annual inspection...but what other scheduled maintenance items would a C120/140/150 owner look for? And how much do those things cost?


Oil change every 25-50 hours. You should be able to do that yourself. Risk of lots of unscheduled maintenance.


3. Out of those airplanes above...what are your recommendations as the best one to own? Not just performance-wise, but also AD-wise and reliability-wise.


Dumb answer but own what you can afford and what you will enjoy. All planes have issues. It depends on what you are willing to deal with.


4. How much does insurance cost for an airplane of that category? Both bare-bones insurance costs and full-up insurance costs would be nice to know so I can decide which one is worth the money.


I would guess less than $1000 a year. Especially if it is a VFR aircraft. I pay just under $1000 for an IFR 4 seat aircraft with 200 HP.


5. How many of you saved money for non-scheduled maintenance and overhauls? How much did you put away per flight hour?


Just take what an overhaul would cost divided by the recommended TBO and put that amount in an account. So where aroun $8-10/hr is a good number.


6. What are some of the other costs not normally thought of...aside from loan payments, insurance, inspections, gas, etc? I've heard some people talk about fixing up interiors because those go downhill fast...others talk about keeping their radios certified for IFR (not too interested in that), etc.


Get a catalog from Aircraft Spruce. Thumb through it and you can get a pretty good idea what parts will cost.


7. I make about what a regional jet captain makes ($60K-ish). Wife makes 30K-ish. I have some debt I'm trying to pay off, but once that's gone (and once I have only one car payment in a year or so), would owning an airplane on that kind of money make sense?


If you want it bad enough you will make it happen. To many variables to factor in. Do you have a mortgage payment. If so how much. On and on. My plane is like having a 3rd car. Costs me about $70 an hour to fly or less including loan payment.


8. What about partnerships? Would finding a partnership be a better route until I make more, and perhaps be a better way to learn the ropes of owning an airplane?


Or join a club. Partnerships only work if you both do a similar amount of flying and agree on how well the plane should be maintaned. Most people say you are better off starting with a new partnership with no aircraft owned vs partnering with someone that already owns the plane. I am considering getting a partner so don't take that advice!

- AZPilot

 

[Loafman]

After re-reading your post, I saw you mentioned the Tomahawk. I wouldn't own a Tomahawk, but I've seen Beech Skippers (very similar plane) for 22K recently. Also it's hard to go wrong with a C152. Just make sure it's not run out and high time, and most trainers have some damage history, so be careful.

You said you can't afford a Bonanza, but I've seen older ones in the $35K range that were mechanically sound... You also make twice the money I did when I had one, but then again, I was single and debt free...

Partners can be a blessing or a curse. If you have a friend that shares your interests, it's best to go in with someone you know and trust. Also helps if they have a better tool set than you too... : )

Plan on putting an old couch in the hangar so you can sleep there when your wife throws you out.

 

[lookup]

Huey:

I'll attempt to add some value here. I own, outright for now, the C172 metioned by Loafman. (I like his comments, just reverse "fixed and variable" costs. He's the professional pilot and I'm the business weenie... ;-)

Anyway...

Questions I have:

>>1. What's the usual loan term/interest rate for an airplane in the 20K price range?

Loan terms can go as high as 20 years or as low as 3-5. You might get some milage out of AOPA's program and advice. 8-10% is not uncommon. Watch out though, they are likely all simple interest loans which means paying just a couple of days after the due date means you make little or no progress in paying down principle. Best bet is to send them a check every two weeks and toss in about $10 extra per check.

>>2. I'm aware of the annual inspection...but what other scheduled maintenance items would a C120/140/150 owner look for? And how much do those things cost?

If you stay away from fabric airplanes, the airframe maintenance can be really low per year. Plan on the following for an average condition Cessna (fixed gear).

- Oil changes every 25 - 50 hours (50 if you have an oil fliter) ($3.50/qt * 5-7 qts) + time (do it yourself!!!) (Get an A&P to guide you through the first one if you are unsure)

There just isn't much to do on the simple Cessnas.
One cost to ALWAYS add in is the $45 per year for a Cessna Pilot Association (CPA) membership!!! (cessna.org) WELL WORTH IT!!!!!!

>>3. Out of those airplanes above...what are your recommendations as the best one to own? Not just performance-wise, but also AD-wise and reliability-wise.

150/152 (or older 172 actually). The 120/140s are cool little birds, but Loafman is right, you can sell a 150/152/172 in your sleep. 120s/140s take a little more since there are fewer people who want them.

They are all just about the same darn airplane. The fixed prop Cessnas have few ADs and any bird that is currently "in annual" is *supposed* to have all ADs complied with (assuming no brand new ADs). If possible, you might take a peek around the shop that did the previous "annual". If they are a clean looking well run shop there is less chance they "pencil whipped" the ADs into shape. Most of the ones on my 172 are really old ADs and weren't that big ofa deal to start with. There was a nasty one on my Lycoming O-360 (oil pump gears) and the Hartzel prop, but previous owners had taken care of them to my IAs satisfaction.

>>4. How much does insurance cost for an airplane of that category? Both bare-bones insurance costs and full-up insurance costs would be nice to know so I can decide which one is worth the money.

It can be pretty cheap. I carry $34K hull and $1M ($100K per seat) and it is about $780 /yr. Your resume is better than mine so you *might* get a lower rate. Loafman is right about the insurance broker.... Many brokers, very few underwriters. I use Phoenix in Austin TX (they are the CPA favored brokers). Unless you have a boat load of assets, just get the basic liability ($1M total, $100K per seat) and keep the hull coverage at about what the plane is worth (it is bad to cheap out on the hull).

>>5. How many of you saved money for non-scheduled maintenance and overhauls? How much did you put away per flight hour?

I am living risky and don't have a "slush fund" for maintenance. If my engine craps out, I am toast! (but at 850 SMOH, I am in good shape)... If you are smarter than I, put aside about $10-15/hour for maintenance. You will likey find some stuff you want to fix/upgrade in the first year, so setting $ aside is smart.

>>6. What are some of the other costs not normally thought of...aside from loan payments, insurance, inspections, gas, etc? I've heard some people talk about fixing up interiors because those go downhill fast...others talk about keeping their radios certified for IFR (not too interested in that), etc.

- about $200-300/ two years for IFR inspection (nice to have)
- Do the interior once and walk away. We found a shop that did car/boat/airplane and understood the "FAA flame test" requirements. They found some fabric that had already passed the test and got right to it. Add about $1500 to the shop and your own elbow grease and voila, new interior. Trust me, when you own it, you take pretty good care of it.

>7. I make about what a regional jet captain makes ($60K-ish). Wife makes 30K-ish. I have some debt I'm trying to pay off, but once that's gone (and once I have only one car payment in a year or so), would owning an airplane on that kind of money make sense?

It all depends on the FIXED costs (hangar, insurance, annual).. In short, anything you pay regardless of if you fly 0 or 200 hours a year. A buddy at work with an Piper Arrow I just had a low hours year and his costs ran $175/hour to fly that year when he factored everything in.

Assuming that your other expenses are "in check", you should easily be able to afford a good basic plane, perhaps up to a basic 4 place bird. Figure out how much you can take out of your bank each month for ALL expenses. That should lead you to a conclusion.


>>8. What about partnerships? Would finding a partnership be a better route until I make more, and perhaps be a better way to learn the ropes of owning an airplane?

Mixed bag. Blessing or curse depending on the partners and your goals. If you seek one out, make sure you:
- have similar flying goals
- have similar commitment to flying
- make about the same money (a rich partner or broke partner can be a pain in the pocket book!)

Also consider "clubs". You'd be surprised how many are out there.

>Thanks ahead of time for any info/comments/smart remarks.

No problem. Feel free to drop me an email if you have more questions. [email protected]

M

 

[pilotyip]

Ownership

A friend of mine just paid 29K for a C-140, I would say 20K is a reasonable price for a C-140. A story, I like old cars, and the 47 Ford Convertible is high on my list of desired cars. I found a complete one that ran back in the 70's for $1,200, I was going to buy it, but all of my old cars freinds told me that was way too much I shouldn't pay over a $1,000. Well I did not want to be taken advantage of so I did not buy it, I never say another 47 Ford for under $1,500 and I do not own one today. The same applies to airplanes, all pricing infromation is historic. If it is good airplane and you can afford it, buy it, someone else will if you don't. How much work do you put into finding your next airplane, how many C-140's so you have to choose from, by the time you find the next one, it will be listed at $22,000. I have given this advice to three airplane buyers and none have told me I am wrong. I own a C-172 and the fixed and varible payments are manageable, but you have to have reserve of several $1,000 for the surprises, and they always come up. $800 for a cylinder here, the $1,500 surprise during the annual that the wing removal AD has not been complyed with etc. In fact my friend with 29K C-140 has had over $2,000 worth of surprises since he bought the airpane. Oil pump, rear housing and broken tail wheel attachment. Have reserve you will need it.

 

[HueyPilot]

Thanks for the replies

Thanks for the info. I really appreciate it. I've decided to wait a couple of years when I move (I'm a military Learjet pilot) to my next duty station. By that time, I'll have all my debt paid off, and hopefully have both cars paid off. Unless I get Germany (no airplane, but it's cool to live there anyways), I'll probably wind up in either the Florida panhandle or Little Rock AR. Either way, that puts me about 300 NM from family, so I'll probably look into an inexpensive 4-seater of some kind with an IFR avionics package. I'd probably use it quite a bit, flying on short trips. At least 100 hours a year, maybe more.

I had been looking into Cessna 172s or Piper Cherokees, but I didn't know you could have a decent older Bonanza for 35Kish. I'll check into that. Much faster airplane than either of the other two. Thanks again.

 

[lookup]

Huey:

Sometimes inaction is the best action... At least you have something to fly in the mean time (thanks for the service to our country btw!)

If you have a small family, there is nothing wrong with a C172 or Cherokee 180 (NO 140!). They are slow, but cheap to keep and easy to sell.

I would be surprised if there aren't some clubs in the area you move into, even in Germany. Those are pretty good deals.

Althought Loafman was REALLY lucky and had no major maintenance issues with his more complex birds, nothing says you won't. If money is an issue, for now, stay away from stuff with gear and props that change position. Those can be two expensive "optional" pieces with a little bad luck.

Best wishes!

M

 

[SATCFI]

Huey,

Where are you stationed now? I am retired AF and just bought my first airplane. Went in with another AF officer, and fellow CFI who has a C195 and is rebuilding a C140 as well. He's owned other planes in the past and is a wealth of knowledge. Already learned to change tires and the oil! Anyway, if you're thinking about 2-place tail draggers, you might want to consider a good Aeronca Champ or Chief. The Chief is side by side and the Champ is tandem...most (like my Champ) have no electrical system, so hand propping and handheld radio are the order of the day. I have had a blast with mine in the short time I've owned it. You can get a decent Chief for around 12-13K and a good Champ will set you back 15-20K. There's an absolutely awesome on on E-bay now: http://cgi.ebay.com/ebaymotors/ws/eBayISAPI.dll?ViewItem&category=26428&item=1875509335

(We gave $17.5K for our Champ with a 1600 hour airframe (recovered 5 years ago) and 600 hour SMOH Continental A-65 engine. PM me if you would like more information on the Aeroncas.

Take care and God Bless!

SATCFI

 

[HueyPilot]

I'm currently at MXF (Maxwell)

SATCFI:

I assume you're in the San Antonio area? That's where I'd like to settle down one day, if I could ever get my wife to go for it (she likes the area, but can't seem to get her mind off her hometown in next-door Louisiana).

Right now I'm a 1Lt at Maxwell flying C-21s. I'll make Captain here in a year. I was also an Army warrant officer for 4 years, and enlisted in the ARNG for an additional 4 years. So when I do make Captain, I'll be max'ed out for pay until I make Major. I've got 11 years in now, and I'll be more than happy to retire as a Major or maybe (if I'm lucky and am still happy with the AF) Lt Col.

Anyways, my next airframe is the C-130. Talking to AFPC, they said Germany is tough to get, but Little Rock shouldn't be a problem. And my other top choice are the gunships down at Hurbie....he said that might be slightly harder to get than LR, but easier to wind up in than Ramstein.

Florida puts us within easy flying distance to my in-laws. And LR is positioned evenly in the middle between her hometown and mine (St. Louis).

As for two-seat taildraggers....I'd love to own one someday...always thought it would be neat to go take one to a fly-in. But since I've got one kid, and my wife is already planning for #2, a four-seater might make things more worth-while for now. But I'd be happy looking into Aeronca's and the 120/140, but I'm going to wait until it makes sense to have a true "toy" airplane. The only way I'm going to talk my wife, who's still very skeptical, into owning one is getting some utility out of it.

I notice alot of other guys own expensive new ski boats and BMWs....I'll just keep driving my old Ford Escort and own an airplane...sounds fine to me. Right now I'm leaning towards a Piper Cherokee....160 or 180 hp. The 140 hp probably wouldn't takeoff with two adults and two kids, at least not with any reasonable amount of fuel.

For now, I'm renting a Piper Tomahawk. Neat little airplane...very very easy to fly...I think it's easier to fly than the Cessnas. The Maxwell Aero Club kind of ruffled my feathers...it's about as painful to fly with them as it is to fly for the AD AF, although I can rent a Skyhawk with them for $10 an hour cheaper than the two-seat Tomahawk. Oh well, not dealing with the hassle is worth paying a little more.

Thanks again for the info.