A common question that takes specific information to answer. Plus, a crystal ball.
10+ years ago, aftermarket jet prices rose for a time. Ever since, they’ve dropped—a lot. 20% “off the lot” and maybe 1% a month afterwards. A falling knife that few wanted to try and catch. Now they’re stable—in some cases rising. The chart below is Global Express’s—when this year is added it will show a tick up (this aircraft is actually one of the weaker markets now–some other heavy jets have risen dramatically).
An example: colleague bought a pair of Falcon 900EX’s wholesale in early 2017, intending to keep one. He suspected the market would firm, and so he chartered out one jet while quietly listening to offers. We discussed the sale. His asking price was out of line — 20% above market, with lots of competition. Then he raised his expectations.
Two weeks ago it sold for 25% more than his original asking price. It never officially hit the market.
So, depending on the specific asset and time window it may be that a used jet holds its value. Will that justify the investment? Depends on your personal hurdle rate, and mission.
Renting (charter) is tough. There’s more demand than supply (most owners won’t rent out their jets) and, like a commercial air ticket, charter costs can add up quickly. I looked at a jet for a trip two weeks ago. 4 hours in a $4,000/hr jet—notionally. The quotes were $31,000 to $38,000. It’s like ordering a $25 entree in a restaurant. Somehow that always works out to $75….
It’s not always that way. But there are a lot of mouths to feed around jets and you’re talking about a piece of equipment where a coffee maker is $20,000+. And costs a ton to move to you if it’s not there already.
In addition to lower hourly cost, owning has benefits that you can’t match via charter. In 2018 you can even make money (in terms of cash flow) after tax if you buy. Yet it’s still a hunk of capital and commitment.
A few examples that may help.
This jet (G550) rents for $7,500 an hour. It will take you and 12 friends from NY to Tierra del Fuego non-stop (!). It sells used for $30MM.+/- (big range).
This jet (GV) rents for $7,000 an hour. It will take you and 12 friends from NY to southern Argentina but won’t quite make Tierra del Fuego. It sells used for $9MM +/-.
This jet (601–3A) rents for $4,500 an hour. A similar one can be bought for $2.5MM. It will take you and 9 friends from NY to LA.
TL; DR
Mission & market analysis + budget + cost of/access to capital = the answer to your question.
Hope that helps: