Living in the south I have definitely seen some of this. Usually the market difference isn't much ($500-1000) but as a general trend I would say that still holds within the $1-10k range.
I feel like this mostly happens with cars that are much tidier and people want top dollar for them $12k+. Not saying it holds, this is from purely anecdotal evidence.
An example that springs to mind is that Bradley Patterson guy's (I think that is his name) v6 sti that has been rebuilt with a v7 sti block. I keep seeing it on the Subaru pages and it seems to never sell. He wants top dollar for it and I guess there just aren't as many people down here looking for expensive, sorted cars. Everyone just wants a cheap rex to thrash for 6months then sell it on.
/opinion