There are a lot of variables that can determine the price of a website. If your web designer is a small one-person firm, they may charge you less than a large company with several designers on their payroll because they don't have as much overhead. However, again, that's not always the case. The smaller web designer may provide a higher quality product, manual hand-coding, and better personalized service, whereas the larger company may simply outsource their work to another country like China or India, and when you try to call you'll never talk to the same person twice. In that case, the larger company may actually charge less because they're not really doing the work, and you may get a generic "cookie cutter" website. Also, if the web designer is also doing SEO (search engine optimization – which is necessary for every website, but something that not all web designers are skilled in), online marketing, social media, a logo, etc., they may (and should) charge more than a company that's simply throwing together a quick website without proper SEO or other online marketing services.
Since there are so many variables in determining the price of a website, how do you know who to hire? I go into detail on this topic in my blog entitled "How to Choose a Web Designer". Obviously if the company doesn't have a website of their own, showing other websites they've designed, you should think twice about hiring that company no matter how cheap their services are. On the other hand, if the websites they've designed look great, how do you know they're actually good quality websites or not? The only way to know for sure is to check "under the hood", much the way you would when buying a car. A beautiful shiny car isn't much good if the engine is bad. But as a consumer, you most likely have no idea what to look for; only an experienced web designer can look at the code behind the website and determine the true quality of the site, much like only an experienced mechanic can determine the quality of a car's engine. You could hit Ctrl + u on your keyboard to see the coding, but it won't make much sense to you. However, if you see anything in the code that says "template" or any wording referring to template type sites (such as squarespace, wix, weebly, website builder, googlesites, dex media, hibu, or "wp" for WordPress), the site is going to be inferior (see my blogs entitled "WordPress Disadvantages" and "Dex Media and Hibu" for more information about those types of template sites), and may therefore not rank as well in search engines.
My websites range from $495 on up, with a simple 3-page responsive (mobile-friendly) hand-coded layout with SEO around $1,200 to $1,500 (as of October 2016). From my research, I've found that my prices are much lower than the average "going rates" for a simple 3-page website (see links below). Plus my sites are hand-coded manually rather than automated template sites, which makes a world of difference.
Check out these websites for helpful information about website prices: