Attractive pricing persists on many popular models despite a continued tightening of inventory to its lowest level since peaking less than two years ago.
A small number of models have experienced an increase in pricing off their lows, but arguably they might never return to the inflated levels visited during the market peak of 2007. Yet any price appreciation seems to speak to the resilience of the market, and further price bumps might be around the corner. Take, for example, the GIV-SP market. Its collapse pounded prices down by 50 percent from peak to trough, which is not hard to explain when, as it did between August 2007 and April 2009, inventory goes from four to 40. So the question is, to what level does inventory have to shrink before the market tolerates a price increase? There are currently 18 GIV-SPs for sale, with average asking prices around $14 million. When there were 18 for sale less than two years ago the average asking prices were twice that, which shelves the supply-and-demand argument that previously seemed a fitting explanation. Copping the line from a well worn financial disclaimer, it seems that “past performance is no guarantee of future results.”
