Year-End Market Report 2023
Here we are again. It’s the end of another year and another look back at the market with the incredible 20/20 clarity that accompanies hindsight. 2023 was marked with a significant, if not unanticipated, slow-down as the fever that surrounded 2021 & 2022 gave way to cooler heads. You could call it a correction, but really, what we’re seeing is a return to pre-pandemic norms. While inventory across the fleet isn’t quite back to where it was leading into 2020, prices have certainly fallen throughout the year as inventory grows along with interest rates.
To appreciate where we are going into 2024, it’s important to understand how far the market has come since just over a year and a half ago. Over the last decade, stasis in the market has generally been viewed at somewhere around 8% of the operational fleet being available on the market. In March of 2022, that percentage was just 3.06. That, both driven by and coupled with unprecedented demand for private aviation, drove prices through the proverbial roof. If you happened to buy in at the right time and you weren’t opposed to parting with your jet, hefty profits were reaped across every sector of the market.
Another driving factor was the backlog of new OEM deliveries. With deliveries stretching out as far as two to three years, if you were fortunate enough to have a delivery position on a new aircraft that coincided with the peak on, say, a $20M Citation Latitude, you could have turned right around and easily sold it for $25M the day you took delivery. While there’s still a backlog, manufacturers are now starting to turn down the spigot to meet waning demand.
Data shows that at the end of November 2023, 7.23% of the fleet is now available on the open market, far closer to the norm, and prices reflect that.
Here are snapshots of a few of our most popular airframes that we are regularly asked to research:
Hawker 800XP
Average model year: 2000
Average AFTT: 7,839 hours
Number of aircraft on the market: 42
Percentage of fleet on-market: 11%
Average asking price: $2,870,000
Gulfstream IVSP
Average model year: 1997
Average AFTT: 9,862 hours
Number of aircraft on the market: 39
Percentage of fleet on-market: 13.7%
Average asking price: $5,777,000
Citation Encore+
Average model year: 2008
Average AFTT: 7,605 hours
Number of aircraft on the market: 6
Percentage of fleet on-market: 9%
Average asking price: $4,396,000
King Air 350
Average model year: 2001
Average AFTT: 5,700 hours
Number of aircraft on the market: 22
Percentage of fleet on-market: 3.35%
Average asking price: $3,480,000
We’re trying to read the tea leaves just like everyone else. It seems that inflation is cooling, and that will most likely bring lower interest rates in mid-2024, which should get a few of those sitting on the sidelines into the game. Of course, if the economy takes a downturn, which a few noted economists believe is inevitable, the market will adjust accordingly. Right now, however, it appears that the market is entering a new phase of relative calm, and if you have cash on hand and don't have to finance, now might be a great time to take the leap. If interest rates do, in fact, fall, prices should see a marked rise coincidentally, and your investment may prove to be fruitful.
As always, if you’re interested in buying a business jet, please feel free to give us a call at 877-440-APEX. We love talking airplanes, and we can start you on your journey or get you into your next aircraft.