Which carrier do you want?
Like Wilkas said, the GS2 are still a solid phone, and should be cheap because of the GS3. The Nexus 4 is only $350 brand new, and should be sufficient for most (certainly not all) users. Without knowing what carrier you want, I can't give a ton of other specifics.
At minimum, it should have:
1 GHz dual core processor
1 GB RAM (most important)
Name brand manufacturer (Samsung, Moto, HTC. NO LG)
Commercials. If you haven't seen a commercial for it, odds are good devs won't support it.
The Commandments of Android
1) Open RAM is wasted RAM - Don't use Task Killers
2) Cheap devices are cheap for a reason. Don't expect high end performance.
3) Boot Loop = Wipe.
4) There are no viruses for android.