Best States to Buy a Car in 2024

Buying a car is not cheap. It may seem appealing to save money by buying out of state and avoiding sales tax. Before traveling to another state, it is necessary to analyze all aspects of the car-buying process. This article will go over the following aspects to help you decide if buying a car out of state is a smart idea for you

A4 Auto Transport analyzes each of these factors to determine which state in the United States is best for buying a car. Consider the top states for initial cost, unexpected fees, sales tax, and vehicle insurance pricing to determine which state is best for buying a car.

Key Highlights

1. Consider Out-of-State: Expand your search beyond your state to find a wider selection, potentially lower costs, and unique car options. Weigh the pros (savings, variety) against the cons (logistics, fees, inspections) before deciding.
2. Prioritize Research: Thoroughly research any out-of-state purchase. Request detailed vehicle history reports to factor in hidden costs like transportation and fees, and understand legal requirements like emissions standards.
3. Top States for Affordability: New Hampshire leads with no sales tax, low fees, and cheap insurance. Oregon boasts no sales tax and low initial costs. Florida offers used cars at 10% discount due to its aging population.

Things to consider while finding the best states to buy a car

If you’re unable to find the desired car model locally, buying a car from out of state can be a viable option. With the convenience of online car shopping, you may come across great deals from different states.

However, it’s crucial to do thorough research before purchasing to avoid any potential nightmares. Here are some key things to consider when looking for the best states to buy a car

Vehicle inspection and history

When buying a car from out of state, you may not have the opportunity to physically inspect the vehicle. It’s important to request detailed photos, videos, and a comprehensive vehicle history report to ensure you’re getting a reliable and well-maintained car.

Sales taxes and fees

Each state has its own sales tax rates and fees, which can impact the overall cost of the car. Research and understand the sales tax and registration fees of the state where you’re considering buying the car, and factor them into your budget.

Transportation and shipping

Buying a car from out of state may require additional expenses for transportation and shipping. Research reputable New Hampshire auto transport services and obtain quotes to determine the cost and logistics of getting the car to your location. If you buy from a private seller, you will almost certainly need to grasp the state’s criteria for temporary registration and apply for it yourself at the DMV.

Emissions standards

Because each state has its own set of emissions regulations, a vehicle that fulfills one state’s minimum requirements may fail in another. The California Air Resources Board, for example, adopted strict emission rules, and several other states have subsequently followed suit.
Check to determine if the vehicle you want to buy is “California certified,” which means it was constructed to meet California smog regulations. This may look severe, but many cars in the other 49 states only meet federal pollution limits. If you’re exporting a car to California or migrating to California, this is an important consideration.

Transport a car home

If you intend to drive the car back to your home state, you must first get a temporary registration to drive the car. If you want to have it delivered, you’ll need to do some research to find a reputable auto shipping company at a fair price. Many dealers have close relationships with auto transport companies.

Automobile insurance

Some auto insurance companies may allow you to transfer your previous car’s coverage to your new vehicle if you notify them within a certain time frame.

Pros and cons of buying a car out of state

While the potential cost savings and wider selection can be tempting, buying a car out of state isn’t without its drawbacks. Here’s a quick breakdown of the pros and cons to help you weigh your options:

Pros

• Wider selection: Expanding your search beyond your local area can open doors to a wider range of models, trims, and features, including rare or specific finds.
• Potential cost savings: Some states have lower sales taxes or used car prices compared to others. You might snag a great deal by venturing out, especially if you’re flexible with the car’s make and model.
• Unique options: You may be able to find cars not available locally, such as those from regional dealerships or private sellers.

Cons

• Increased logistics: Dealing with out-of-state purchases adds complexity. You’ll need to arrange temporary registration, transportation, and possibly emissions testing depending on your state’s requirements.
• Hidden costs: Additional costs like shipping, registration fees, and potential inspections can eat into your initial savings.
• Physical inspection limitations: Inspecting the car in person can be challenging if it’s far away. Relying on detailed photos, videos, and vehicle history reports is crucial.
• Legal and warranty complexities: Out-of-state purchases may involve different transfer processes, title requirements, and warranty coverage details.

Weighing the options

Ultimately, the decision depends on your priorities and circumstances. If you’re flexible, have time for research and logistics, and prioritize a specific car not available locally, the potential savings and wider selection might outweigh the challenges. However, if convenience and immediate availability are more important, or if you’re on a tight budget, sticking to your local market might be the wiser choice.

By carefully considering the pros and cons, you can make an informed decision about whether buying a car out of state is the right move for you.

States with no sales tax on vehicles: New Hampshire

When looking for the best states to buy a car, considering the sales tax rates can be crucial. A single-digit sales tax may not seem significant, but when purchasing a high-priced item like a car, it can add up quickly. Fortunately, there are some states in the United States with favorable sales tax policies.

Alaska, Delaware, Montana, New Hampshire, and Oregon are the only states that do not have a sales tax, which means you can potentially save a considerable amount of money upfront on your vehicle purchase. Additionally, Colorado has the lowest non-zero sales tax rate, set at 2.9 percent, making it another attractive option for car buyers.

By exploring states with low or no sales tax, you can potentially save on the overall cost of your vehicle and stretch your budget further. However, it’s important to keep in mind that other factors such as vehicle availability, legal requirements, and transportation costs should also be taken into consideration when choosing the best state to buy a car. Conducting thorough research and understanding the unique considerations of each state can help you make an informed decision and potentially save money on your car purchase.

States with the cheapest auto insurance: Maine

When considering the purchase of a car, it’s essential to keep in mind that car insurance is mandatory in many states. The cost of insurance can vary depending on your location and the specific make and model of your vehicle. If you’re planning to transport your car across states or long distances, it’s crucial to find the best car shipping service to ensure its safe delivery.

For instance, in Maine, where car insurance rates are generally low, it’s even more critical to secure the best car shipping service to protect your investment. Maine boasts the lowest auto insurance premiums in the country, with annual premiums averaging $864. This amount is significantly lower than the national average of $1,318.

Similarly, states like Ohio and Idaho offer yearly auto insurance rates below $1,000, making it worthwhile to explore reliable car shipping options for your vehicle. On the other hand, Michigan faces high auto insurance costs, prompting the state government to seek ways to reduce expenses. If you reside in Michigan and are looking to transport your car, finding the best car shipping solution becomes even more crucial.

States with no sales tax on vehicles: New Hampshire

When looking for the best states to buy a car, considering the sales tax rates can be crucial. A single-digit sales tax may not seem significant, but when purchasing a high-priced item like a car, it can add up quickly. Fortunately, there are some states in the United States with favorable sales tax policies.

Alaska, Delaware, Montana, New Hampshire, and Oregon are the only states that do not have a sales tax, which means you can potentially save a considerable amount of money upfront on your vehicle purchase. Additionally, Colorado has the lowest non-zero sales tax rate, set at 2.9 percent, making it another attractive option for car buyers.

By exploring states with low or no sales tax, you can potentially save on the overall cost of your vehicle and stretch your budget further. However, it’s important to keep in mind that other factors such as vehicle availability, legal requirements, and transportation costs should also be taken into consideration when choosing the best state to buy a car. Conducting thorough research and understanding the unique considerations of each state can help you make an informed decision and potentially save money on your car purchase.

The best state for initial costs: Florida

Florida is an excellent place to buy a used vehicle. In Florida, used cars are 10% less expensive than in the rest of the country. With Florida’s aging population, many people abandon their cars each year due to poor vision or other age-related issues. As a result, there is a plentiful supply of used automobiles on the Florida market, which keeps costs low. Furthermore, richer Florida residents sell their automobiles more frequently to get the most recent models.

California, on the other hand, has the highest initial car cost. California has an extremely high cost of living, and used car sales are much lower than in the rest of the country. As a result, their prices are significantly higher, and competition is strong.

Best states for unexpected fees in USA

If you’re concerned about unexpected fees, Oregon is a great place to buy a car. According to The Balance, initial car-buying costs are often less than $150, which is a fraction of what is paid in other jurisdictions. Alaska and New Hampshire are two other fee-friendly states. They usually do not charge more than $360.

However, some states have hefty fees that might completely wipe out your money. In Alabama, you won’t have much success avoiding unexpected fees. The unexpected fees in this state are significantly higher than in the rest of the country. The average unexpected fee is around $2313. That’s over 18 times what you’d pay in Oregon and 14% of the average car price.

Best states for low car fees in USA

When considering the lowest average dealer documentation fees, several states stand out:

1. California: California has one of the lowest average dealer documentation fees, averaging around $55. This fee helps cover the administrative costs associated with selling a car.
2. Oregon: Oregon also boasts a relatively low average dealer documentation fee of approximately $61. However, it’s essential to consider other costs, such as registration fees and taxes, when buying a car in Oregon.
3. New York: New York has an average dealer documentation fee of around $74. It’s worth noting that additional fees and taxes may apply, so it’s crucial to understand the complete cost breakdown.
4. Minnesota: Minnesota is known for its relatively low average dealer documentation fee, which is about $75. However, it’s advisable to research other fees and taxes imposed in the state.
5. South Dakota: South Dakota has an average dealer documentation fee of approximately $93. While this is higher compared to the other states listed, it still falls within the lower range compared to national averages.

Affordable states for car buyers in USA

Here are some affordable states for car buyers:

• Oregon: No sales tax and lower registration fees.
• Alaska: No statewide sales tax and low ownership taxes.
• New Hampshire: No sales tax and no income tax.
• Montana: No sales tax and lower registration fees.
• Delaware: No sales tax and lower vehicle taxes and fees.
• Missouri: Lower-than-average vehicle prices and registration fees.
• North Carolina: Lower-than-average vehicle prices and registration fees.
• Florida: No state income tax and lower registration fees.
• Arizona: Lower registration fees and relatively affordable insurance rates.
• Michigan: Lower vehicle prices compared to the national average.

Is it cheaper to buy a car out of state?

It’s important to conduct thorough research before buying a car out of state, as the costs can vary. While certain states may have lower sales taxes, they might also have higher prices for used cars and dealer fees. If you’re seeking a specific make, model, or rare vehicle, it might be necessary to look beyond your state’s borders. Similarly, if you plan to relocate to a state with lower taxes and fees shortly, postponing your car purchase could result in savings. However, it’s worth noting that buying out of state may not always lead to significant savings. Additional expenses like sales taxes, registration fees, inspections, and emissions tests can offset any initial cost advantages.

Overall best state to buy a car in USA

New Hampshire is the overall cheapest state to buy a car. The unexpected costs of buying a car in New Hampshire are fairly low. You can save money upfront because there are no state sales taxes and very minor registration expenses. Insurance premiums in the state are also extremely low, at around $941 per year. The average annual cost of automobile ownership in New Hampshire is around $2,691.

FAQ’s

A4 AutoTransport

a4AutoTransport is a group of auto transport researchers and experts that comes in handy for anyone who wants to move their car/vehicle without putting extra miles on the odometer. At a4AutoTransport, We researched over a hundred car shipping companies, interviewed real customers and industry leaders, and collected nearly 500 quotes to find the nation’s best auto transport companies. With our combined 5 years of industry experience and research, we’ll help you find the right car shipper for your budget.