This is just a follow up to Wraithen's thread. I said that I could build a .5 MOA rifle for $500 so here' it is. This is for a very simple gun, without optics or a fancy stock. It will be fully functional and shoot as well as guns which cost twice as much.
First up you need to find a donor rifle. For me, this is always a Savage 110/10 based gun. Caliber doesn't really matter, just be sure that you have the correct action length. (you don't want to buy a short action if you're building a 7mm Mag) This includes the Stevens Model 200, but not the Edge/Axis series. This will also work for the Marlin XL 7, but I have not personally worked with one of those. For a budget gun I suggest waiting until the Stevens goes on sale. I've picked them up brand new for $250. The Stevens will come with a very basic trigger which can be tweaked into a decent, function hunting trigger with a pull around 3#. They can go less but I'm not fond of working them that much. A better option which will let you start out with an accutrigger is to search the pawn shops, gun shops, and online classifieds for a used Savage 110/10 (the 110 is a long action, the 10 is a short action) I've bought at least 6 used Savages, with accutriggers and cheap scopes, for $300 or less. Two of those were actually stainless! The number one rule in buying a donor rifle is
DON'T SHOOT THE DONOR RIFLE! 
75% of the time, the donor shoots so well that I end up keeping the original barrel.

Now that you have your donor rifle you need to decide what your over all budget really is. If you want to keep it as cheap as possible, you'll need to work with the factory stock to save money. The factory "tupperware" stocks aren't great but they are entirely adequate with a little love. Knowing what your true budget is will determine which parts of the donor you will keep and which parts you'll sell to help fund the project. A factory Savage barrel is worth anywhere from $40-200 depending on caliber, contour, twist rate, finish and round count. A factory stock is worth $30 for a cheap blind mag Stevens stock, or $200+ for an HS Precision stock. Factory triggers are worth $10-30.
For a barrel, decide if you need a brand new barrel, or if you're willing to buy a used one. I've bought low round count PacNors for as little as $150. McGowan and Shilen barrels show up in the same price range pretty often. I bought my most recent McGowan (a stainless 20" 358 Win) for $70 shipped. Not bad for a $250 barrel!

Most factory Savage barrels with shoot around .75 MOA with a little load development. Many will do much better. Most of the stainless factory barrels have been between .5-.75, with varmint barrels doing much better at times. I just sold a 26" SS Fluted 223 barrel for $125 and that barrel was shooting well below .5 MOA. If you want to get a new barrel on a budget, I recommend Criterions. They are a button rifled Krieger, and the same barrel Weatherby uses. The last one I had was a 26" 6mm BR (varmint contour) which was shooting in the .3" range with no load development. The price of a Criterion barrel has gone up in the last year, but new ones are about $280. I sold my 6 BR for $200. Jim at Northland Shooters Supply stocks Criterion barrels in a variety of calibers and contours which are ready to ship right now with no wait time!
For the super low budget rifle, this is where you'd stop. All you need to do now is slap it together. No gunsmith necessary! Check out this video to see how.
http://youtu.be/bsM6_J8doIEThis guy really knows his stuff!

If any of you local guys need help, just let me know. I have all the tools you'll need to do it your self, and I'd be happy to help you out.
So that's really all there is to it. Here's a break down of the costs:
$300 (donor rifle)
- $50 (selling your old barrel. You may get more than this)
+$250 (a little more for a new barrel, a little less for a used one)
$500!
This is pretty bare bones, but it's just to show that it can be done. I've helped other people build 6 Savages in this price range. They all get tweaked, tuned and upgraded though as finances allow. Change that used Criterion barrel to a new, nitrided Benchmark, and you just blew $600 for just a barrel! Swapping out that factory stock for an XLR Industries Chasis and an AI mag or two will cost you another $900. A new trigger, $150. A T&T job at Sharp Shooter Supply another $150. More money doesn't always make the gun shoot better. Just look cooler. But that's half the fun isn't it?
This rifle was built entirely out of parts I picked online over the course of 1 year. The 28" PacNor 300 WSM barrel came off of my first $600 home build. The gun doesn't shoot any better after sinking another $1400 into it (not counting the scope), but it sure is pretty! It's still a .3 MOA rifle as far as I've shot it, just like when I first built it.

So there you go. You really can build a $500 gun that will shoot less than .5 MOA. I left out a lot of little steps, but this post is getting pretty long, and I'm getting hungr :hello:y!
Andrew