I've been biking casually for a little while now, but I recently replaced my "couch on wheels" bicycle, a big heavy beach cruiser, with a hybrid. Here's how I recommend getting a decent bike:
How To Get A Decent Bike
1. Identify several bike models that you'd be comfortable riding. For me, that was a hybrid. This
roundup review has a good selection. Felt also produced a now discontinued hybrid, called the Verza.
2. Download the unofficial Craigslist app and create a search that captures all the bikes you want. A typical search might be (Sirrus Specialized) | (Jamis Coda) | (Trek 7*) . That search turns up any one of those three bikes, and the Trek one turns up Trek 7.2, 7.3 or 7.4 bikes - the asterisk just means return results with any characters after that 7. You can have the CL app notify you when there are new results, or just check it manually.
3. Download or check the website of the
Bicycle Blue Book to get roughly how much you should pay for a bike.
4. Contact the sellers with roughly at or below market rates. If you see something a little above market, you can try bargaining him down or pointing him to the blue book (I didn't need to do this). If everything checks out, bring cash, meet up, take the bike for a spin, check the parts (use a checklist, like
http://www.cyclorama.net/viewArticle.php?id=342 ) and buy the bike. Look out for suspicious listings and avoid them.
I found a bike that was 1-2 years old, retailed for just over $600, for $250 plus some extra gear. I didn't even bargain with the guy, because the price was already $50+ below blue book and the guy was super nice. When I bought it, it was the most promising listing, from several days of listings in a major city. So don't feel compelled to make a choice among the existing listings, wait a little bit. The more specific your search - like say, you only wanted the Sirrus Specialized, the longer you'll have to wait. There are always people who are desperate to get rid of their bike at bargain rate prices, so there's no reason to pay more than blue book - or so my experience suggests. Just move quickly.
In general, I think you can get bikes only 1-2 years old in great condition for about half their retail price. While you can easily go older and cheaper, that will require some deeper knowledge of bike brands and components that you may not have - I don't. If you want to get a different bike down the road, you won't suffer that immediate 50% loss from buying new. Plus bikes are one of those things that many people buy and end up not using them, so you really can get a like new bike for half price. The downside is your selection among used bikes is not as great.
What is your take on the best bike for urban commuting? Aside from fixies, which are a special case. I've seen a lot of people suggest hybrids, especially the steel Jamis Coda, but I also wonder about adapting a road bike, say with fatter wheels, or even a cyclocross.
Initially, the more prone posture of the hybrid freaked me out a little bit, but I quickly adjusted.