Rexon,
By happy coincidence over the last month I have built up a hifi system I am VERY happy with for around 400 quid. Here's how/what I did:
Firstly, RicherSounds are your friend. I swear by these guys, not just because of their prices, but for 2 main reasons:
1) The 5 year supercare warranty is a brilliant deal and gives great peace of mind.
2) If you have some equipment, and want to upgrade it, they'll let you at no charge (except the price difference). When I went from my Cambridge A1 to A5 amps, they didnt even check to see if I'd damaged the first one before upgrading!
Right, my set up:
Amp: Cambridge A5 - I started with an A1, and soon decided I wanted more power so got the slightly larger A5. Its dead simple, has a very nice clean look (black brushed aluminium), and the action on the volume control is VERY smooth, which I find always encourages me to turn it up... Bass and treble controls are there, plus a bypass which I find handy now and again, left and right channel balancing, and 5 two-channel inputs. 120 quid
Speakers; TDL Saturn/Studio 10's - AMAZING speakers for the price, I paid 150 for them, but they've now dropped to 100. Solid bass, good mid range and high end, and in my opinion are some of the best looking floorstanders for under a grand (except maybe the Q Acoustics ones). The pairing to the Cambridge amp seems brilliant. 100 quid.
Subwoofer: Gale 4070 - maybe not the best subwoofer for around this price range, but I liked the look of it, and kicks out more than enough bass. The only part I'm tempted to upgrade, but its definitly more than good enough for listening to music (and I listen to a lot of electro, drum and bass and dubstep, where a full bass sound is very important). A subwoofer might seem excessive or only really for movies, but you get a much more rounded sound and once you've had one you wont want to be without one. Even for rock, I'm currently listening to Fleetwood Mac and the bassline to The Chain cant be beaten with a subwoofer in your installation. 80 quid
Cables: Gale Symphony 400's - a lot of people ignore the cost of cables when pricing up their system, or go for rubbish ones. I went for the 400 over the 200 as it was thicker, and in general that means better bass quality. I've also gone for 5m length, dont really need it, but it means I can move speakers around without fear of ripping my amp around. In addition a subwoofer will require a dedicated cable. 20 quid for 2 5m gale 400's, plus 10 for the sub cable - 30 quid
Total: 330 quid
Amazing setup, with the exception of maybe a more powerful sub i'm not planning on changing it any time soon. Hope this helps.
Russ