This is true, shop for the horse that’s a square peg, i.e., find a dressage horse at an AQHA barn, an eventer at a dressage barn and so forth
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By “ready for Second” does that mean competitive, consistent scores at First level and a horse who would do a good second level test at home, but perhaps without a great score and the additional strength required?
I does seem to me that Second Level has a big strength-building component to it. That takes time, a solid base of training and money to produce, no matter what quality of gaits you bought.
I’m just trying to understand what determines prices in the lower level dressage world.
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OP, how much of a trainer are you? I ask because so many of your problems–wanting a tall, good-moving horse for little money-- can be solved by your ability and desire to train the horse.
Personally, that’s how I roll. I like to buy “raw material,” 60 days under saddle started by anyone competent (and preferably without lunging and sidereins) and I’m good, if the horse has the gaits that can do the job and a mind I can figure out.
But lots of other people who want lower level dressage horses want that horse to be pretty consistent in the contact. I don’t get that goal, for a greenie. I don’t care, because I am more worried about the horse being forward-thinking and how he carries his rib cage. I can install whatever kind of feel in the bridle needed. And I don’t find the installation of relaxation and rhythm hard in a horse who was started in a basic, generic, WTC, whoa-and-steering way. Rather I think those things should be cultivated early in a horse’s training and I find it helpful to buy a horse who likes to find a rhythm. But I don’t think rhythmicity is a rare quality in horses. I do think that finding a horse who has relaxation, rhythm and forwardness with that consistent contact in the bridle that dressagists seem to want (at least in the show ring) is harder to make. To me, that is a horse who is not green (and so I can’t afford him if he’s of the quality I’d want), but is rather a baby specialist.
In short, then, my guess is that your set of potential horses for your price will enlarge if you can ride a horse that you have to train, particularly with this forward-into-very-consistent-contact thing if you can do the training.
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Yes, when I hear people are looking for a lower level dressage horse IRL, they invariably mean a dressage prospect.
I dont know anyone who went shopping for a currently competitive second level horse. At that point, the ads say “competing at 2nd with ability to go higher” and prices match. The supply of horses narrows drastically above first level where most ammie horse and rider pairs stall out. And no one wants to buy someone else’s stalled permanent training/first level horse with big holes in their education. Everyone prefers to get a green horse and ruin him themselves 
in their own special way.
Anyhow if you only want w t c and some lateral movements, buy a less educated horse with a good mind going w t c and teach the lateral movements. They are easy to teach to any decently conformed and obedient horse.
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I just found a Friesian/Morgan cross I really like. Going to see him this weekend.
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Good luck!!!
I agree with people who say look at everything. The trainer out of my barn is a western rider and his specialty is starting and riding difficult horses. I have seen LOTS of TBs, QH, and mixes that would make great lower level dressage horses. In fact, his daughter just won intro on their QH mare.
You need a horse with a little movement (can go round for the level, can track up) but moreso, a great brain who is willing and happy to do the work.
16-16.1hh is not considered tall for dressage. Actually, it can be considered tall for QH. Your budget seems pretty reasonable IF you can spot a diamond in the rough. Many people sell horses for under this budget, esp in the western world or more DIY websites/facebook pages. I have watched TONS of videos with my friend and “we” (hahaha) settled on a QH ~5K whose movement was gorgeous to me - a dressage person and her, western dressage rider. The one think I’ll note is that many QHs are started at 2 and some have had a whole lot of wear and tear by that age. I’d pass on those.
There are WB crosses available in that price range. Horses by less known local stallions who don’t show and never did a 30 or 70 day test to less known local mares fit this bill. Because it is so easy to get great semen these days, get from these horses tend to go more cheaply. People also do crosses to see what their particular stallion crosses best with, and sometimes those crosses (even owned by outside people) tend to go for cheaper. A friend of mine picked up a 4 year old Trakehner mare for $500 because the owner didn’t want her/was divorcing. That brings me to life circumstances.
If this horse doesn’t work out for you, do NOT be shy putting the word out to barns and breeders that you’re looking and this is your budget. There ARE people who would rather sell their horse to a cheap but great home rather than an expensive and not great home. Maybe breeders or professionals will know of “diamonds in the rough” that someone can’t keep anymore.
You are in NYC? You can easily look at local horses and maybe be prepared to drive a bit to check out a horse.
I might be the only one, but I don’t think you’ll have a problem finding a nice lower level horse in that price range if you are patient and really look around.
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this is so true, describes mine to a T!
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That sounds like such a cute mix! Keep us posted!
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Quick update: The Friesian Cross did not work out. The horse was a carriage horse, it is only 3 and has never been ridden.
Thanks for all the great feedback. To clarify, as many of you pointed out, I am looking for a Dressage Prospect, and NO, I have nothing against TBs; I just had a couple of bad experiences with them. Still looking.
Seeing as you’re in NY, what about standardbreds? I know they aren’t the first thought, but they are lovely horses. I rode a great STB hunt horse, no pacing at all.
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What about a trail horse or hunter? Something safe with experience and then you can work on the lower levels.
Have you considered leasing a horse?
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This is so true! I evented an OTTB like this who also had the mindset of “get out of my way, rider, I have this”. And she did. I the WBs I’ve jumped (non Hosteiners) were like “why should I go over when I can easily go around? I don’t get it?”
The trainer at the barn currently has an OTTB in training that the owner purchased online without seeing the horse in person (Danger, Will Robinson, Danger). She put it in training originally because she didn’t tell her husband… moving past… horse came back into training recently. That TB is pastured next to my horse and they share a run-in. HOLY COW, now that the horse has had groceries, he is amazing. A beautiful extended trot to a passagey trot and the trainer taught him flying changes a couple of weeks ago. I watched the owner ride him yesterday and although her riding is subdued compared to the trainer, the horse looked great and she was so happy. He was only, as I recall, a few thousand dollars and in TX. The horse is super friendly and always comes to say hello when I go out to get mine. He is great buds with my horse.
OOOooohhhh, would I love to train that horse for dressage and not western. They are out there!!
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Friesian Arab can be nice
SRF gets some nice looking horses
They won’t adopt to the SW US, I’m to far away. 
I am opening my mind more and more about OTTBs. I had a couple of bad experiences in the past with them but I have seen some really nice ones recently.
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I bought an older TB jumper last fall. I’ve converted primarily to dressage, and though we’re only doing training level now, he’s awesome! Great brain, willing, and pretty mover for what I’m doing. Good luck!!
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All of my recent horses have been ‘word of mouth’ types. Put the word out to everyone you can. My friend knew I was looking for a cute project, and when Alex was offered to her (for free!), she passed the information on to me. The more people know you’re looking, and what you’re looking for, the more prospects you’ll turn up. A lot of the really good horses never get advertised.
I never met an OTTB I didn’t love. They are so eager to figure out what you want! “You want this? No? Flying change! No? Um - Lateral work!” No? Um . . . Halt? Got it!" If you have a CANTER nearby, you might see what they have available?
You might also look at ‘off brand’ crosses, as others have said - I was just thinking yesterday about a QH/Saddlebred that same friend bought for herself. He was a really cool horse - good gaits, great mind, about 16 hands, eager to please. I’d never for a second have considered that cross, but he was a really nice horse.
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From your description, you are looking for more a First/Second Level horse which is definitely going to be out of your price range unless you find some fantastic weird situation.
Dressage horses are not started with lateral work right away usually. That is extra buttons that you will be paying for. I know Western horses typically come with lateral work and a flying change installed, but if you want those things in a dressage horse, it is going to cost you.
I would definitely expand your height range. 16.0-16.1 is very specific. I think you will have more luck looking for a QH, Appendix, or grade horse than a Friesian cross in your price range.
Good luck!
MTA: I agree with the posters recommending a Standardbred or SB cross. I have heard great things about them as dressage horses.
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I would encourage you to look at Saddlebreds if you want something fancy, sane, sound and in your budget. Feel free to join my FB group: American Saddlebreds and Half-ASB Sporthorses. The demand has been growing exponentially in the past few years as the secret is finally getting out and the Registry is doing more and more to promote the breed as more than just show horses.
The foundation for the American Saddlebred was the Thoroughbred, and Saddlebreds have retained all the TB’s smarts, athleticism and stamina but are also built uphill, exceedingly comfortable and the vast majority have feet & legs of solid steel.
A nice Morgan would also be an excellent option. 
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