AKC GSD registered from great lines. Both parents checked out with excellent hips. She is in superb health and is such a beautiful example of the breed. Amazing drive, superb temperment, and insane ease of trainability. She's from a small breeding program that might be called "backyard" in some circles and didn't cost me $1600. By your standards I'd have a cheap, badly bred dog. In contrast, I've seen some crap dogs that people paid a lot of money for. It boils down to doing your research and finding a good, reputable breeder, not the price. Though I do agree that I'd much rather pay more money for a well bred, healthy dog, than take the cheap way out.
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