Buying a Private Jet: Considerations for the First-time Buyer
With the demand for private charters flights nearing all-time highs, limited availability is leading to access challenges and higher prices. That, coupled with favorable interest rates and beneficial tax codes in the US, is causing many aviation consumers to consider buying a private jet. For those who are new to this game, there are a number of considerations that worth bearing in mind.
Choosing the Right Aircraft Class
One of the first things you’ll want to consider is your private aviation needs. This will go a long way in determining which type of aircraft is right for you. Things you should be asking yourself include:
- How often do you fly?
- What distances do you typically travel?
- How many people do you fly with?
- What cabin amenities do you like/don’t like?
The last thing you want to do is invest in an aircraft that is inadequate for your mission requirements. If it doesn’t have the range or carrying capacity, it won’t be of much use to you. Similarly, buying a private jet that’s superfluous to your needs means you will not only pay more for the initial investment, but also in higher operating costs. It’s worth noting that larger jets typically require longer takeoff distances, which limits potential airport options and reduces flight-planning flexibility.
Valuating an aircraft, particularly a used one, is a skill. That’s why most consumers will solicit the services of an experienced broker to inform their buying decisions. The aircraft’s age, type and condition will all play an important role in determining the cost of a private jet. A knowledgeable broker will help you:
- Spot any hidden fees
- Determine whether you’re buying a plane with a good pedigree
- Choose an aircraft that will hold its value compared to class competitors
New vs Used
Buying a new jet is a lot like buying a car off the showroom floor. You enjoy all of the latest amenities and technologies, as well as the peace of mind that comes with owning something that’s never been used before. But you pay a premium for it. A pre-owned jet, on the other hand, will cost significantly less than a new one. And just like vehicles, depreciation is most aggressive in those first few years. So while you might need to invest in refurbishing a used aircraft to bring it up to standard, you could still save a lot of money. One concern some first-time buyers have when buying a used jet is safety. This is completely understandable, but as long as the aircraft in question has received the proper maintenance, it will be just as safe as a new one.
Once you buy a jet, you’ll be faced with the task of maintaining it. There are a number of fixed costs you can expect to incur on an ongoing basis, including:
- Pilots and crew
- Hangar fees
And then, of course, there are the variable costs, which depend on how frequently the plane is used. The primary ones are fuel and maintenance.
Chartering Your New Jet
One way to recoup some of the cost of buying a private jet is to put it up for charter services. This allows you to maximize your asset when it’s not in use. To avoid scheduling conflicts, it’s good to know when you’ll be flying ahead of time. For more on the current market conditions in the US, read: Trump Tax Cuts Make Buying a Private Jet More Appealing. If you’re buying a private jet for the first time, talk to Stratos Jet Management and Consulting about your aircraft placement options. Call us at 407-657-5001.