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Big subject, i am sure you get many opinions. My 2 cents, from building my observatory about 2 years ago. I am a believer in getting it off the ground. Mine is build on posts set in concrete, so its a timber structure with roll off roof. All the walls, roof, and floor are designed to be able to flat pack to move if ever required. Being up off the ground by six to twelve inches has good benefits in terms of condensation management, and preventing cold feet. Obviously the pier and footing is built first and the obs built around/ over it. In my case the pier rises into the obs through a hole in the floor, where services also enter. Timber ROR obs are very cost effective, and there are many examples around on the forums and the Net. Timber structures will be cooler in summer than any metal type shed. Your budget will easily build a timber/ply type obs and you will money left over. Mine is 2.5 x 2m, has a workstation area and a carpeted floor. It cost about $1500 to build.
Good luck, and check out the many build threads in the DIY Observatory forum here at IIS.
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