I'm a Honda guy, but I'd go with a Toyota Prius over a Honda Hybrid. Most of the 2nd gen (2004-2009) Priuses should be within your budget. 45-55 MPG without much effort. I can get 60-70 MPG in one if I really try. Very reliable and used parts are pretty easy to find now.
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2000 Honda Insight
2000 Honda Insight
2000 Honda Insight
2006 Honda Insight (parts car)
1988 Honda CRXFi
1994 Geo Metro
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