Here is a piece from Barron’s: It’s the Right Time to Buy a Vintage Airplane
With some words of advice at the end.
Even though they describe well how much this needs a love of aviation and care, they also tangent on how a well kept airplane can appreciate in value. What they do forget is how much money it takes to keep an old plane in good shape. They also had a “hype piece” about warbirds: http://www.barrons.com/articles/funds-investors-buying-wwii-fighter-airplanes-1497628098
Mind you, Barron’s Penta claim is “Personal Finance for Wealthy Families”. 
Is vintage plane collecting a thing in Europe? Or are we usually happing to have one that flies well?
I’m just happy to have a 71 year old plane that flies well! In these parts, vintage aircraft form a large part of “affordable flying” (unless it’s something absurdly thirsty like a warbird or anything with big radials) and is just about the furthest thing removed from “investment”.
It hasn’t taken me much money to keep my vintage plane(s) going, although it takes some. It’s definitely a great time to buy and own.
In 1989 I bought a repossessed Lada at the Glasgow Car Mart for £1600. At the end of the year I bought a share in a Jodel DR1050 for £1600.
The Lada had lost £1000 when I sold it, and bought a Volvo 480, at the same car mart in1994.
The last time a Group share sold, it was £2200. I still have my share.
But £50 per month for hangarage and insurance, and the time spent helping LAA maintenance, would make it insane as an investment.
I would be willing to help investors avoid deterioration due to lack of use by flying their aircraft without charging them, out of pure kindness.
Assuming the group share sold during the crisis in 2008… buying £1600 worth of FTSE-100 tracker in 1989 would have sold for £2926 when the stock market was at its absolute nadir in 2008, and it would have been paying dividends during that time, so I think buying planes as investments is probably not the hottest idea :-) £1600 worth of FTSE tracker bought in 1989 today would fetch £4714, and that doesn’t include the nearly 30 years of dividends.
I think buying a vintage plane to fly it and enjoy it for what it is, is a much better idea than falling into any kind of delusion that it’s an “investment”!
Hey, nobody says it’s a real investment, but people at least need a reasonable excuse to plunk down a noticeable amount of money for something of no obvious direct benefit.
In the US, from about 1960 to about 2000, small aircraft generally rose in value at the rate of inflation or better. Most people expected that every year their plane would be worth more than the year before. Since then (over the last 15 years or so) values have been flat, reducing real purchase cost substantially for some very nice planes. Assuming their value won’t start rising again that makes them not so much an investment as a good value recreational purchase, especially considering that so many other comparable activities involve buying fast depreciating hardware.
The biggest ‘investment ’loss’ in the ownership of a classic plane is the cost of inside storage… They almost invariably need to be kept inside and that costs money. My response to that was to find a fairly large rented hangar and make it a place where we can socialize and have fun, and also a workshop, somewhat disconnecting the cost from the aircraft. For years this meant I could comfortably live in a smaller house, saving the money spent on hangar rent (and more).
I think the biggest issue in Europe specifically for vintage planes is that airspace constraints and regulatory equipment requirements make them more of a toy than a toy that can also take you to far off places. To me, that would push me towards owning a small biplane or the like, something that you wouldn’t typically use to go places anyway.
Silvaire wrote:
Since then (over the last 15 years or so) values have been flat, reducing real purchase cost substantially for some very nice planes. Assuming their value won’t start rising again that makes them not so much an investment as a good value recreational purchase, especially considering that so many other comparable activities involve buying fast depreciating hardware.
The value of such a plane is roughly 1/10 of the value of a similar new one. We would say such a thing only has “useful” value left (don’t know the English term). What it means is that the value of the aircraft as a useful object, is larger (to you) than the value you will get for it in money when/if you sell it. All value as any kind of investment is therefore gone, nothing left.
For a recreational thing, like a private aircraft, the “useful” value can in principle be all or nothing, and anything in between, and is usually different from person to person. For an aircraft to be an investment, you have to make money on it. The only way to make money on it, is to charge someone to fly it. Then a new one is usually a better investment than an old one, because maintenance and particularly lost income due to unexpected maintenance, makes older planes literally useless as money making machines.
LeSving wrote:
The only way to make money on it, is to charge someone to fly it.
Or, as in the case of those warbirds mentioned in the second article, by buying it for less than you hope to be able to sell it at a later date (minus storage costs and risks).
A bit like the reason why people buy gold and stuff it away somewhere. Apart from some industrial or jewellery uses, it is practically useless: You can’t eat it, you can’t burn it, and it won’t grow by its own. All you can hope for is to find someone “more stupid” later who will pay you at least what you paid now for the gold you own. If someone looked on from space and saw that earthlings dig out the gold from one place with a lot of effort just to bury it somewhere else as deeply and securely as possible, the whole process must appear utterly comical.
Rwy20 wrote:
…that earthlings dig out the gold from one place …
The airplane enthusiasts among those earthlings do not dig for gold but for Spitfires instead. So far with not much success, but who knows, maybe tomorrow?
http://uk.businessinsider.com/man-who-tried-to-dig-up-140-spitfires-in-burma-2015-9?IR=T
