NORTH PALM BEACH, Fla., Feb. 17, 2021 /PRNewswire-PRWeb/ -- Twice as Many First-Time Buyers Looked for Private Jets at End of 2020 vs. 2019; Advice on Aircraft for First-Time Private Jet Buyers
Driven by continuing concerns about Covid-19, the resulting cuts in commercial air service, and the possible end of Trump-era tax benefits favoring private jet ownership*, the number of businesses and wealthy individuals looking to buy a private jet for the first time doubled, compared to recent years, according to private jet broker The Private Jet Company (TPJC), providing sales, acquisition and consulting services to private jet buyers and sellers.
"The fourth quarter is when half of private jet transactions occur due to tax planning," said Daniel Jennings, CEO of The Private Jet Company (TPJC). "With health concerns due to the continuing pandemic and the possible end of several tax incentives, we saw double the number of first-time buyers and 50% more repeat buyers in the fourth quarter of 2020 compared to the past several years.
"High-net-worth individuals with multiple homes continue to contact us because they're no longer willing to fly in first class on commercial carriers due to Covid concerns and the deep cuts in the frequency of commercial service. They want to know 'how can I make buying a jet work?", adds Jennings.
Advice to first-time private jet buyers
New jet deliveries cannot meet the current short-term demand for private jets since most manufacturers are sold out for the next three years.
Jennings' advice for first-time buyers can be summed up as follows: buy a mid-sized aircraft that is most desirable for charters and can be easily bought and sold. Interestingly, most first-time buyers resell their jet aircraft within two or three years of purchase, usually in order to upgrade.
Best private jet aircraft for first-time buyers
One of the ways to offset the cost and upkeep of private jet ownership is placing it out for charter. A mid-sized plane, carrying six passengers, is the type of private jet that is most often chartered. Examples include the Cessna Citation Excel and XLS, Embraer Phenom 300, Learjet 60, Hawker 800 XP and 850 XP. Pre-owned aircraft in good condition range in price from $1 million to -$6 million.
These mid-sized aircraft are used for non-stop flights on the most popular domestic US routes: such as New York-to-Florida; Texas-to-Colorado; San Francisco-to-Los Angeles; San Francisco-to-Las Vegas; California-to-Colorado. They are not suitable for cross-country trips due to refueling stops.
"Mid-size private jets are a very liquid market," notes Jennings. "They are easy to buy and sell -- due to high demand for both purchase and charter of this type of aircraft," said Jennings.
*Editor's note: The 2017 tax cuts allow 100% depreciation in the first year of ownership for items such as new or pre-owned aircraft used for business. The 2020 CARES Act includes a five-year net operating loss carryback that permits tax payments going back to 2015 to be refunded due to a loss in the current year.
About The Private Jet Company (TPJC)
The Private Jet Company offers sales, acquisition, and consulting services for private aircraft in major markets throughout the world. Founded in 2005 with headquarters in North Palm Beach, FL and regional offices in Paris, France and Mexico City, Mexico, TPJC has completed over $2 billion of aviation transactions for individual and corporate owners. In addition to assisting clients buy and sell aircraft, the company works with aircraft management companies to reduce the burden of maintenance and supplement revenue through charters. TPJC also partners with aviation attorneys and tax experts to help clients maximize depreciation, reduce tax burdens and assist in import and export Certificates of Airworthiness.
Photo caption: The Hawker-850 XP is one of the mid-sized private jet models that is most in demand by first-time buyers and for charters.
Chris Lazarus, The Private Jet Company, (503) 867-1370, [email protected]
Daniel Jennings, The Private Jet Company, (310) 980-9069, [email protected]
SOURCE The Private Jet Company