Here are 10 Best and Cheapest States to Buy a New or Used Car
Looking to score a great deal on your next vehicle? Whether you’re aiming to avoid high taxes, reduce registration fees, or simply get more value for your money, where you buy your car matters.
There are many cheapest states to buy a car based on affordability, low fees, and buyer satisfaction. These states include Oregon, New Hampshire, Montana, Delaware, South Dakota, and more, offering substantial savings for car buyers. Let’s dive into why these states are the best options for saving big on your next car purchase.
Key Highlights
- Oregon & New Hampshire are the top cheapest states to buy a car with no sales tax, and their registration costs are modest based on vehicle age and weight.
- The states like Montana, Delaware, and South Dakota are also among the cheapest states to buy a car, with no sales tax or low registration fees, making them highly affordable options for car buyers.
- Avoid buying cars in States like California, Louisiana, Florida, and Texas because they have high sales tax, expensive registration, and costly insurance.
- To buy the cheapest car, consider tips like compare prices across counties or states, shop during off-peak seasons and consider private sellers to avoid markups.
1. Oregon
Oregon is a standout when it comes to buying a car thanks to its no sales tax policy. This can help car buyers save hundreds or even thousands of dollars, making it one of the most affordable states to purchase a vehicle. If you buy a car online in Oregon, you should choose the best websites to buy cars to compare the prices.
- Sales Tax: 0% – Oregon does not charge a vehicle sales tax.
- Other Fees: Registration fees are relatively low, around $126–$316, depending on vehicle weight.
2. New Hampshire
Like Oregon, New Hampshire is the least expensive state to buy a car with no sales tax policy, making it another ideal place to save big on car purchases. The state also offers affordable registration fees and is home to a variety of dealerships with competitive prices on both new and used cars.
- Sales Tax: 0% – No sales tax on vehicle purchases.
- Other Fees: Registration costs are based on vehicle age and weight, but remain modest compared to most states.
If you’re purchasing a vehicle from New Hampshire and need it delivered across state lines, using a reliable car shipping service can help ensure it arrives safely and hassle-free.
3. Montana
Montana offers a favorable environment for car buyers as it charges no sales tax and inexpensive registration fees. The state also features a mix of urban and rural markets, with rural areas providing competitive prices on used cars.
- Sales Tax: 0% – Montana charges no general or vehicle sales tax.
- Other Fees: Registration varies depending on the car’s age and weight class.
4. Delaware
Delaware is well-known as the cheapest state for those looking to buy a car. Not only can buyers save on the vehicle’s purchase price, but the state also has reasonable registration fees.
- Sales Tax: 0% – No sales tax on car purchases in Delaware.
- Other Fees: Title and registration fees are minimal, with registration costing roughly $40/year.
5. South Dakota
South Dakota features a low sales tax and affordable vehicle registration fees, making it a cost-effective state for car buyers.
- Sales Tax: 4% state sales tax on vehicle purchases.
- Other Fees: Low registration fees, often around $30–$100 depending on the vehicle type and weight.
6. Wyoming
Wyoming stands out because it has no state income tax, which helps reduce overall living costs. It also offers low vehicle registration fees and favorable buying conditions.
- Sales Tax: Around 4%–6%, depending on the county; no state income tax helps offset costs.
- Other Fees: Registration fees are moderate, ranging from $30–$90 annually based on the vehicle.
7. Nevada
Nevada offers low sales tax rates and affordable registration fees, especially outside major cities.
- Sales Tax: 4.6% base rate, but can reach ~8.25% with local surcharges.
- Other Fees: Registration fees are higher in urban areas and can exceed $300/year for newer cars.
8. Idaho
Idaho is one of the cheapest states to buy cars and is known for its modest sales tax and low registration fees, offering an affordable car-buying environment.
- Sales Tax: 6% statewide.
- Other Fees: Annual registration ranges from $45–$69 depending on vehicle age.
9. Michigan
Michigan is one of the least expensive states for buying cars. Especially for the people who own the most expensive cars, Michigan is often regarded as the cheapest state to buy such expensive and luxurious cars offering low prices.
- Sales Tax: 6% on the purchase price.
- Other Fees: Registration fees depend on MSRP and vehicle age but are generally lower than in high-tax states.
10. North Carolina
North Carolina offers a low vehicle sales tax and a wide selection of affordable dealerships across the state.
- Sales Tax: 3% highway-use tax replaces traditional sales tax on vehicles.
- Other Fees: Registration fee is around $36 annually, plus potential county taxes.
States to Avoid for Car Buying
While some states offer major savings on car purchases, others can drain your wallet with high taxes and fees. States like California, Louisiana, Florida, and Texas often have steep sales tax rates, pricey registration, and insurance costs.
1. California
California is one of the most expensive states to buy a car due to its high sales tax and costly ownership fees. Buyers face steep registration, insurance, and documentation costs.
2. Louisiana
Louisiana may offer lower vehicle prices, but high sales tax and some of the nation’s highest insurance premiums quickly add up. Overall, it’s a costly state for car ownership.
3. Texas
Texas combines high sales tax with pricey registration and insurance fees. These costs can substantially increase the total amount you’ll pay for vehicle ownership.
Factors That Affect Car Prices in Different States
Car prices vary across states due to several factors. Here’s a breakdown of the key elements that influence pricing:
1. Sales Tax and Fees
States like Oregon and New Hampshire have no sales tax, while others, like California and Texas, impose higher taxes and registration fees, significantly increasing car costs.
2. Demand and Supply
Car prices fluctuate depending on local demand. For example, trucks are pricier in states like Texas, while compact cars may cost more in urban centers with high demand.
3. State Regulations and Emissions
States with strict emissions laws, like California, can drive up vehicle prices due to required environmental features. In states with looser regulations, cars may be cheaper.
Tips for Buying the Cheapest Cars in Any State
Even if you don’t live in one of the cheapest states to buy a car, there are still plenty of ways to cut down on costs:
- Compare Prices Across Counties or Nearby States
Sometimes, just crossing a state line can save you hundreds or thousands. Use online tools to compare dealer pricing in neighboring areas. - Buy Used Cars
Buying a used car can save you a significant amount compared to a new vehicle. In this regard, you should consider choosing the best used car websites that can help you buy used cars in the best condition. - Shop During Off-Peak Seasons
Car dealerships are more likely to offer discounts during slow months (like January or August), especially when they need to hit sales targets. - Negotiate Dealer Fees
Always ask for a breakdown of documentation and dealer fees. Some fees are negotiable or even avoidable. - Get Pre-Approved Financing
Securing a car loan from your bank or credit union ahead of time gives you more leverage and avoids high dealership rates. - Check Out Private Sellers
Buying from a private party can eliminate dealership markups. Just make sure to get a pre-purchase inspection and complete all DMV paperwork correctly.
Conclusion
Buying a car is a big investment, and where you buy it can make a surprising difference in how much you spend. From Oregon’s no sales tax to Delaware’s low fees, these 10 best and cheapest states to buy a car can help you stretch your budget further. But no matter where you are, savvy strategies like buying used, timing your purchase, and negotiating fees can save you serious money.
Ready to start your car-buying journey? Whether you’re relocating or just bargain-hunting across states, knowing where to look is half the battle.
Frequently Asked Questions
What is the absolute cheapest place to buy a car?
Oregon and New Hampshire are often cited as the cheapest states due to their no sales tax policies and low registration fees.
Can I buy a car in a different state and register it where I live?
Yes, but you’ll need to follow your home state’s registration rules. That means paying any applicable sales tax and registration fees once you bring the car back.
Are there extra costs when buying out-of-state?
Possibly. You’ll still owe your state’s taxes and DMV fees, and you may need a new vehicle inspection depending on local laws.
How long does it take to get a car registered?
In most states, it can take a few hours to a few days. If you have all your documents, you might get it done in a single visit to the DMV.
Are used cars always cheaper to own?
Not always. While they’re cheaper upfront, some used cars may have higher maintenance costs or less warranty coverage. Always weigh the total cost of ownership.
Should I get a pre-purchase inspection for a private sale?
Absolutely. It’s one of the best ways to avoid expensive surprises and ensure you’re getting a reliable vehicle.
Hello! I just read your article about the cheapest state to buy a new car. However, I would first like to sell my old car, then I will buy a new one. Can you please share with me any tips on how I can sell my old car?
I appreciate your feedback, and yes, we will share some of the best car selling sites with you. If you would like more details, Hopefully, this will help you sell your car.
Your Tips really added value to my knowledge. I will definitely apply them in my life.
Hey, Victoria, what a great and useful post on cheap states to buy cars. You are doing well, thank you. Could you please provide me with some details about platforms or sites where we can sell our cars online?
Hi, Natasha thanks for your comment. Read our article to learn about car selling websites.