Every kid or better yet teenager has dreamt of the day they will own a car. They will be able to drive at a moment’s notice to anywhere without any restrictions. Private Jets are the same but for adults. One of the most attractive parts for grown ups is the 100% tax write off if you own one.
With that being said, while buying a private jet you can let emotions creep in or you will have problems. Especially when you are buying from a second hand market. This could mean pricey upgrades and shady usage records. There is a world’s first corporate showroom in Mayfair London but you don’t need to fly to London to figure out what you want. To help you steer clear of those emotions and make the best purchase, below are somethings you should be careful about:
1. Dont Just Buy It
Whether you buy a used car or a new one you always always consider two things, your needs and your travel habits. Same goes for private jets, you need to realistically measure if you need one and how often you travel. One of the first questions after these considerations would be “ What’s your budget? “. People often reply with i don’t have a budget, i am just looking for a plane but you should always have a budget and everyone does. This should factor in the fuel and maintenance costs as well. Take out your pen, paper and open up your travel spreadsheet to help you make the decision of whether you need one and whether you can afford to buy one. For your biyearly London travels and moving from chicago to new york twice a week, you don’t need to buy a jet.
2. Keep Emotions In Check
Kevin O Leary, president and founder of jet advisors, tells the story of people often showing up to buy a jet and asking about their competitors’ jets and on top of that wanting to buy a bigger one. It might sound like highschool advice of don’t take social pressure but it happens more often than you would think to adults too. Don’t let emotions creep into decision making, especially not one that is as expensive as this one. While buying a plane, keep in mind your needs and your budget and do not, we repeat do not exceed them because your friend has a bigger one. Going over budget could topple over the business you are trying to do this for.
3.Costs Of Upgrades
Considering the corporate cabin makeovers to getting an avionics system, the list of upgrades a jet can get is as long as a corporate tax return. However, as you are sifting through the buyers market, really consider the need and price of these modifications. Most of these are just show and bling which won’t be used by you even on a single flight. E.g a seller might tell you that this feature saves pilot time but you have to be mindful of exactly how much time for the extra million or hundred thousand dollars. Five minutes? Probably not worthed. However, the more legroom and seats in the cabin are not only worthed for you but also have great resale value.
4. Foreign Travels
Most US buyers are looking for aircrafts that are already registered in the US but the Trump administration tax reforms have restricted the supply of private jets, sky rocketing the demands. People are looking to buy jets from outside the US now which just need a transaction but still we would recommend making sure the transaction is according to the US government requirements. This will help you re-register in the US very easily. Simply put sellers dont have any obligation for registration or anything once they make the deal, its on the buyer to make sure he is US government compliant.
5. Take An Eagle View
If you plan on keeping the jet for a while make sure you have it all planned out, from buying to selling. You need to anticipate changes that might affect your needs and the needs for a bigger or smaller aircraft. E.g will your children be traveling with you? What about when they move for college ? Do you really need an entertainment system, don’t you already have fast WIFI? Etc. A clear understanding of how long and how often you will use the aircraft will save you alot of money and trouble in the future. Make sure to have an exit resale strategy in place to, should your needs change.
Lastly, we would recommend finding the right people to help you buy the plane. If you are making a multi million dollar purchase, remember to hire a competent person to save you the hassle of going through the taxes and the registration etc. This will not only save you time but make your rides more enjoyable. Happy jetting!!