'great' bookshelf speakers for under 500?

PSB Image 25 got a rave review in Stereophile (from a writer seemingly incapable of giving less than a rave review, however, so take it with a grain of salt). B&W 601s are highly regarded. Also check out the Paradigm Monitor line. You probably can't go too far wrong with any of them.

There's a lot to be said for starting small and working your way up, if and when you really have a reason to.

There is something of an embarrassment of riches in this category; tasty small monitors retailing at under $500.
One that I heard recently was the Epos ELS 3; delicious. I haven't directly compared the Epos side by side with others, but if memory serves it is great in its class. Also bought and still very much like the KEF Cresta 1 in that category. I thought the Monitor Bronze very good, with a little more throw weight, perhaps not quite the delicacy of the KEF. By all accounts there are lots of other excellent choices. Based on other Totem models I've heard, the Mites should stand up well too.

I've owned Soliloquy 5.0's and Ruark Epilogues, both available for under $500 used, and both are excellent monitors.

There is a fellow selling Silverline SR-11's used on Audiogon. Asking $675, retail new is $1500. Buy these and you will never look back - although at some point you'll probably add a REL sub, as you would for any high quality minimonitor.
Art

If you're talking about buying new, the KEF Q1 stand mounts would offer a smooth and somewhat warm sound, which is what you want in a budget speaker (to protect your ears from any fatigue associated with budget tradeoffs.)