The 5 U.S. states where used cars cost the most: In Alaska, you have to pay nearly $30,000

The pandemic and a chip shortage have caused used car prices to rise across the board, and there's no more expensive state to buy one than Alaska. The average preowned vehicle there costs $29,656.

That's according to new data from iSeeCars.com, which studied 8 million pre-owned car sales from February 2021 to July 2021 to find where drivers pay the most, and least, for their rides.

Nationwide, the average transaction price for all used cars was $21,558 in July, according to Edmunds. Cars in The Last Frontier are roughly 20% higher, and shoppers there shell out $7,695 more than those in Indiana, where older vehicles cost the least, at $21,961 on average.

The price fluctuation is based on a "combination of geography and population," says Matt DeLorenzo, senior managing editor for Kelley Blue Book. Of the top five states with the highest prices, four are out West. "You'll find more cars in areas with higher population that are easily accessible: Alaska is far away and lightly populated; Indiana is in the heart of the Midwest."

Here are the top five states with the most expensive used cars.

Average used car price: $29,656      
Percentage over average: 20%

Average used car price: $29,419      
Percentage over average: 19.1%

Average used car price: $27,303      
Percentage over average: 10.5%

Average used car price: $27,123      
Percentage over average: 9.8%

Average used car price: $26,662      
Percentage over average: 7.9%

^{Video by Jason Armesto}

And here are the five states with the least expensive used cars.

Average used car price: $21,961      
Percentage below average: 11.1%

Average used car price: $22,244      
Percentage below average: 10%

Average used car price: $22,528      
Percentage below average: 8.8%

Average used car price: $22,618      
Percentage below average: 8.5%

Average used car price: $22,995      
Percentage below average: 6.9%

_{Video by Stephen Parkhurst}

If preowned vehicles in your area are out of your budget, it can make sense to expand your search. But should you cross state lines for a discount? "It depends on the drive," DeLorenzo says. "If you can drive the car home in a day, then it's probably a good idea. Any farther than that, you have to factor in transportation costs if you have the car shipped." Plus, there's the cost of gas plus meals and lodging, "which could eat up any savings depending on the car you buy." 

Check out different dealerships where you live first, then broaden your search from there. A bigger radius can mean more vehicle options and a wider range of prices, but you'll want to keep an eye on the amount of money you spend to get to and from the location itself.

That said, "if you're looking for something out of the ordinary, you might actually find it in a less populated area," adds DeLorenzo. "You might find a sports car in Montana that you could get for less than in a more populated area with a higher number of people looking for the same car."

Edmunds, Kelley Blue Book, and similar sites can help you compare costs in different areas.

Wherever you decide to purchase your ride, get on the same page with the seller upfront. Talk about any additional features or deals you want and be willing to negotiate. You may need to make some concessions, Brian Moody, executive editor at Autotrader, previously told Grow.

"The more specific you get with features, the harder it will be to find a car," he said. "Look for cars the dealer already has on the lot and be flexible about the color, year, options, and interior."

Consider the full financial picture, adds DeLorenzo, like if you have a "car with great trade-in value, or whether it would be more to your advantage to sell it to a private party or another dealer." And don't rule out the idea of buying a new car: It could end up costing less.

More from Grow:

• To score a used car deal, expand your shopping radius to within 'a day's drive', auto expert says
• 'Everybody wants your car': The top 10 used vehicles you can buy after a lease and sell for a profit
• Some cars are now cheaper new than used: You'll save most on these 5 models