A close friend used to build good rifles cheap--he did it mostly for the pleasure of it. But like others have said, it takes more than $500 these days just to get good parts. Arthritus has slowed him down. I have owned several of his rifles and none cost me over $750--some alot less. They were well made and shot very good. Sometimes he made one and sold it just for the cost of new materials to make another. He is locally well known and often does gunsmithing work for free. He has been known to give away guns for free [eg., to friends who could not afford one]. Perhaps there is someone like that near you--if you are real lucky. I am lucky to know such a man.
Obviously he was not trying to make a living at gunbuilding. There is no way a person could sell a rifle for that cheap and make any kind of living from it...