What is the Real effect of Damage?

Consider that you have the opportunity to buy either of two aircraft you have been dreaming about owning. They are identical in every respect except that one had a hard landing that resulted in damage to one of its landing gear. The damage was repaired and except for the paper documentation, there is no evidence that the event even occurred. Both aircraft are identical in terms of flight worthiness. But, would you be willing to pay the same amount for either aircraft? Unlikely!

As a seller you would want the appraisal to take in account that the aircraft has been repaired correctly and it is just as flight worthy as the unaffected aircraft. As a buyer you would want the appraisal to accurately account for the mishap. Where most price guides simply deduct a fixed percentage from the total aircraft value, the appraiser correctly analyzes all aspects of the aircraft’s history and thus satisfies both the seller’s and the buyer’s requirements. Most damage events only affect one or two items, e.g. landing gear, wing, propeller, windshield, etc. where as the major components that account for an aircraft's value are unaffected by the damage. If you deduct 10% or 20% of the aircraft's value due to the past damage event, your are deducting that percentage from potentially high value item like the avionics, and engines that were unaffected and may even be new since the event. Does this make sense? Of course not! Nevertheless, the two aircraft will clearly not command the same amount at resale! It's not that the two aircraft differ in terms of flight worthiness, but the market will not treat them as equivalent due to the stigma associated with the prior damage! . At Just Plane Appraisals we make a fair assessment of the aircraft which takes in account all of these factors.

The marketplace decrease in value depends on the type of aircraft, the extent of the damage, and the method of repair. There are other factors as well. The market is less accepting of damage history on certain classes of aircraft. For example, the stigma of damage is far greater to a corporate jet than it is to a single-engine piston aircraft. The Appraiser analyzes the current market for each particular type of aircraft when calculating value reduction for the type of damage incurred. The values of unrelated components are not affected. This approach is based on the appraiser's experience in tracking the aircraft market since 1980 and from performing literally tens of thousands of Certified Aircraft Appraisals during this period.

This difference between the appraiser and the other methodologies can translate into a BIG difference in the real value of your aircraft. Appraisers have access to the computer software and data bases to properly account for the impact of historical damage.

Ask your appraiser what method he uses to calculate damage history. If it is not the system described above, walk away!