I dont know what prices are like in the SW, but here in upstate NY you can find a Vstar less than 10 years old with less than 10k miles on it for 3 to 5 thousand easily.
Up here people buy them new, dont ride them much because of the winters, or they realize they dont like riding and dont ride them hardly at all.. and end up selling them for a fraction of what they paid.
The weird thing is, it doesnt matter if its a 650, 1100 all the way up to a Royal star or Road star - a good stock bike with low miles that is several years old, and ready to ride (good tires, maintained, does not have carbs full of goop) if you look around you can find one for $3500.
I got my Royal Star last fall, 2000 with 27k on the odo for $2400. I know its an older bike, but the guy I bought it from had it for 7 years, only put 2000 miles on it, and kept it in his garage in excellent condition.
If you are going to rebuild your engine, you need to consider all the other things that wear out with mileage: all the bearings in the wheels and suspension and steering, the shocks and springs, the exhaust....