When you need to buy or sell aircraft, you will have to use aircraft valuation services. You will have to contact such a service, as no transaction will go off well without this exercise being done, and both parties agreeing on the findings. In most instances, a person looking to sell ensures that the valuation process points out so many details, to drive the price up. A person looking to buy on the other hand tries their best to have a few items as possible covered, to drive the price down. It is important to, therefore, understand how to calculate the true value of an aircraft, whichever side you happen to be standing. Click here to know more about aircraft values.
When it comes to the transaction process, valuation is only to set the tone for the negotiations, not to dictate prices. Both buyer and seller have to agree on certain things in the process. The value quoted in such a report is determined by the gathered in the valuation process. There are aircraft brokers who routinely produce data that is used to amend the values of aircraft. Therefore, manipulating the quoted values of the aircraft is possible. The information gathered also takes time to be populated. This means the quoted value could be older than the reality on the ground. You can read more now.
There is, therefore, a need to consider certain variables when you need to wish to have an accurate calculation. The physical description of the plane for one is an important variable. There can be some upgrades whose value will not necessarily reflect on the aircraft in their entirety. The cost of labor for those upgrades, for example, adds no value to the aircraft. Therefore, quoting the total expense of the upgrade as an addition to the value of the aircraft shall be misleading. Looking at the aircraft physically shall be a more accurate descriptor of its value.
Valuation services will have certain items as part of the base price. This means their figures should not change since they are already part of the base price calculation. Even if those items are no longer there, there shall be no deduction of the figure in the overall quote. It shall also be assumed that everything about the aircraft is in working order. Therefore, stating that something as not working until you fixed it shall not add to the overall quoted figure.
There is a lot that goes into coming up with the book value of the aircraft. After this is known, there shall be negotiations between both parties to reach an agreeable figure for the transaction. The buyer will try and argue certain things make it too expensive, while the seller will try and say those things add so much value to the aircraft. Therefore, that valuation is there to act as a guide, and at the same time, to initiate the negotiation process. It is not the final say in the price to be agreed upon. Discover more here : https://www.dictionary.com/browse/aircraft.