If you are looking for the best bang for your buck I would go used. You should be able to find something lightly used and fairly high quality in your price range. Most important thing is to make sure it fits. No matter how good the deal is don't buy a 60 cm bike if you're 5'4" or a 48 if you're 6'.
I personally went the other way and went with a new low end bike. The frames from any major manufacturers are solid, even the most inexpensive, what you loose is quality of components. I just waited til things break and find deals on upgrades.
Either way, make sure the bike fits and ride it til the wheels fall off, then you can buy new wheels