In the last six months the pre-owned aircraft market has seen a notable increase in transactions. Enquiries, demand and closings have increased substantially across the range of aircraft types and sizes. While this is a fantastic development and gives great reason for optimism, the recovery in prices has not followed this trend. We are still seeing notable price decreases in almost all sectors, particularly in the older, ultra-long range aircraft such as some Gulfstreams and Globals, and long range aircraft such as the Challenger 604. These tend to have a knock-on effect as they impact not only aircraft competing within their segment, but also aircraft in the segment below as people adjust to the lower priced, larger aircraft.

That said, this rule of continuing price declines is not true in all cases. There are certain markets where limited supply has actually caused prices to stop falling. The Falcon 2000LX, Gulfstream G650 and Citation CJ3 have all seen recent stabilisation of prices. This is a far cry from increasing prices, but it is a good sign that the demand from certain markets has recovered enough to equal supply.

We have also noted a strong increase in potential financiers. While most financiers focus on aircraft that are over US$20 million and less than five years old, there are some new firms that intend to specialise in older aircraft that are US$5 million and lower. Due to the lower values in today's market place, this now covers a tremendously large segment of the pre-owned market that had previ-ously been ignored by lenders. This is another positive sign that the industry is slowly recovering its strength.

One very noticeable consequence of the recent recession is that transactions have become more complex. The changes in tax laws, operating rules, EU Ops rules, and the widespread worldwide attention on 'income inequality' mean transactions now involve numerous jurisdictions in order to accomplish each principal's business objectives in the sale. Each deal often incorpo-rates three or four different jurisdic-tions which must be navigated. A result of this added complexity is added time. We tell clients in advance that a transaction is likely to take a couple of months, if not longer, and to be prepared for a longer sale cycle than in the previous markets.

Overall, we see many reasons to be optimistic, but we urge people not to let optimism blur the reality of the marketplace. Pricing is still the key motivator behind almost every sale, and most buyers still perceive the market to be in distress. Perception is hard to shake and until we see substantial pricing changes, it is one that the industry will have to work with.